In July, the Bay Area Air Quality Management District was considering whether to hire additional staffers to assist with administering a new regulation when board member Shirlee Zane boasted “this air board, quite frankly, is flush.”

“We can more than afford to hire … extra help to do the assessment,” said Zane, a Sonoma County supervisor.

“We have plenty of money,” Zane added — a sentiment echoed by Katie Rice, a board member and Marin County supervisor.

While the rosy perception of the district’s finances may have been isolated to just a few board members, the willingness to spend on additional staff and a lavish New Orleans trip coincided with what’s become a routine increase in fees charged to those local businesses considered stationary sources of air pollution — costs which experts say are then passed onto consumers. 

New Orleans

Two months prior to Zane’s comments, Jack Broadbent, the district’s executive director, sent a letter encouraging all board members and staff to attend the Air and Waste Management Association’s 109th annual conference in “vibrant” New Orleans, to “witness the rebirth of this spectacular region of the Gulf Coast.”

The conference was an opportunity to “address environmental issues that can best be approached in a collaborative setting,” wrote Broadbent, who sits on the association’s Board of Directors.

Twenty-five people took advantage of Broadbent’s offer, costing the district $54,000, which included a $2,300 dinner for everyone. All of this was absorbed by an out-of-state travel budget that more than doubled this fiscal year. 

The conference’s website included a packed schedule, but also highlighted the many tourist attractions available, like carriage tours, shopping opportunities, cooking classes, art museums and steamboat cruises. 

District spokesperson Kristine Roselius said the trip’s average of $2,160 per person was an “appropriate” cost for the level of training received, which included “the opportunity to learn from air quality experts and learn the latest academic research, innovative approaches to measurement and quality science from engineers and scientists from all over the world.”

Fee increases

The district aims to have 85 percent of expenses covered by fees associated with things like equipment permitting and inspection, while the rest comes mostly from Bay Area property taxes. However, the district is only recovering about 81 percent of its costs through fees, with the gap costing around $8 million. 

Fees have increased each year for some time, as have general expenses. Roselius said the travel budget is still rebounding from the cost-cutting days of the last budget crisis, and that the district considers the effect on consumers when increasing fees, adding that there’s a state-imposed, 15 percent cap on annual increases.

“We look at the impact on the business/facility through our detailed socio-economic analysis,” Roselius said. “This helps us weigh this against the cost recovery percentage and what percentage the fees will increase.”

Someone’s gotta pay

While power plants, chemical plants and petroleum refineries fall under the district’s jurisdiction, so do smaller businesses like gas stations, dry cleaners, auto body shops and manufacturers of all sizes. Even boilers at schools, hospitals and apartment buildings are subject to the districts fees and regulations.

Some businesses may be situated to absorb higher fees. But most of the time, an increase in expenses will get passed through to consumers with higher prices for goods and services.

“Anytime you move on fees, somebody’s going to pay the price,” said Tom Scott, the National Federation of Independent Business’ executive director for California. 

Most industries in the state are subjected to some kind of regulatory costs, though those considered to have a higher environmental impact are often hit the hardest — this can have a lopsided effect on the overall economy.

The Bay Area has enjoyed a consistent hiring surge in the past few years, with gains primarily in technology, health care and leisure and hospitality. Meanwhile, statewide manufacturing job creation — long considered the backbone of the American middle class — lags far behind the national average. 

Moving on up

Based on an internal study, the district aims to keep a reserve fund of at least 20 percent of the annual budget, which comes to around $15 million. 

At least $9 million of the reserve fund will be used as a down payment on a new office space. This year the district moved out of a building it owned in San Francisco to a new location nearby, which it will share with the Metropolitan Transportation Commission and the Association of Bay Area Governments.

BAAQMD has plans of purchasing the new space for somewhere around $29 million. The prior building, which was owned by the district, sold for around $16 million. 

The new building is supposed to improve communication between the organizations, while the old building was outdated and needed $30 million in renovations, according to BAAQMD documents. 

Currently, the reserve fund is projected to have around $7 million more than the desired minimum, which no doubt aided Zane (and Rice) in her willingness to spend. But she wasn’t looking at the whole picture, said Roselius.

“The statement by one board member about the state of the Air District finances did not take into account what will be paid out soon when the Air District puts its down payment toward the cost of the new building,” Roselius said.

Assembly Bill 52: Public accommodations: construction-related accessibility claims. It’s by Assemblyman Adam Gray, D-Merced, and would:

• Protect small businesses from financial exploitation and encourage compliance with construction-related requirements under the Americans with Disabilities Act.
• Reduce statutory damages in claims against small businesses if the business corrected any violations within 180 days.

Assembly Bill 54: Public accommodations: construction-related accessibility standards: tax credit. It’s by Assembly Republican Leader Kristin Olsen, R-Modesto, and would:

• Aim to deter costly and unnecessary lawsuits against businesses by providing small businesses a 60 day opportunity to cure, if construction-related accessibility standards related to an alleged Americans with Disabilities Act violation had changed within three years.

Assembly Bill 1486: Civil rights: disability access. It’s by Assembly member Catharine Baker, R-San Ramon, and would:

• Provide that a State Architect certification of compliance with the Americans with Disabilities Act would serve as presumptive evidence that public building and facilities are in compliance with the Act.

Senate Bill 67: Disability Access: statutory damages. It’s by state Sen. Cathleen Galgiani, D-Stockton, and would:

• Exempt small businesses from statutory damages for violations of the Americans with Disabilities Act.
• Extend the opportunity to cure technical violations from 60 to 120 days.

Katy Grimes: The news that another small Sacramento business is closing its doors seems only to draw yawns these days.

The famed Fords Real Burgers, a local Sacramento burger joint since 1987, is being forced out of business by increasing costs, higher taxes, strict regulations, and a local disability lawyer/activist.

“Between a thin margin of profit and increasing costs, we were on a pretty tight edge,” said former owner Pete Vereschzagin, in a Sacramento Bee story.

“The ‘last straw,’ he said, was when Carmichael attorney Scott N. Johnson, who is quadriplegic, wrote a letter to the restaurant about two months ago citing its failures under the Americans with Disabilities Act, including its lack of a disabled parking space and a restroom that could accommodate wheelchair access,” the Bee wrote.

By Katy Grimes

SACRAMENTO — Apparently fearing the outcome of the political reform measure Proposition 32, some California lawmakers have added “storyteller” to their resumes.

In one of the most nostalgic fairy tales ever told at a Capitol hearing, it was revealed that all labor unions have voluntary membership,and employee payroll deductions come willingly.

But Prop. 32 is also bringing out the ire in labor union proponents. The idea of political reform doesn’t appear to be agreeing with everyone in the state, and is even making some rather testy.

A mandatory hearing on Wednesday about Prop. 32 found Republicans glaringly absent from the proceedings. While this allowed legislative Democrats unfettered access to the initiative’s proponents, John Kabateck of the National Federation of Independent Business and David Wolfe of the Howard Jarvis Taxpayers Association held their own rather well.

Kabatek and Wolfe easily answered the questions hurled at them, and countered the disinformation in the many pro-union mini-speeches by legislators.

A union fairy tale

Probably the biggest fairy tale at the hearing came from Assemblywoman Susan Bonilla, D-Concord. “It’s very important to understand that union membership is voluntary–no one is forced,” Bonilla said. “It’s a well-established voluntary practice.”

“If a union member objects to dues being used for political spending, the law allows them to opt out,” she said. “These are well-established practices, and clearly laid out, and very transparent to the employees.”

“Then why not just make it an opt-in?” Kabateck asked.

“There is no involuntary collection of money spent on political purposes,” Bonilla retorted. “They have the right to not become members.”

It is worth noting that Bonilla has accepted $108,905 in total political contributions from general trade unions, and $76,675 from public sector unions, according to Maplight.org, which tracks and publishes political contributions and voting trends following contributions.

However, Bonilla was not alone in her grilling.

Prop. 32

If approved by voters in November, Prop. 32 would end the questionable practice of automatic payroll-deducted funds from employee paychecks for political purposes.  The prohibition applies to both labor unions and corporations, as well as government contractors.

Prop. 32 also would end union and corporate contributions to political candidates, and would end government contractor contributions to elected officials.

Dems fight back

In a Capitol hearing room of mostly labor union lobbyists, Kabateck explained that, after years of special interest-dominated politics, small businesses and individuals want their voices heard again in politics. “Voters are tired of government gridlock and placing special interests above the individual. Voters are awakening, taking power back, and holding elected officials accountable,” Kabateck said.

In a NFIB member survey, Kabateck reported that 93 percent of respondents supported political reform through Prop. 32. “It will stop ‘money-in, favors out.’ You, not your boss or board, should decide where your vote belongs,” Kabateck said.

The current pay-to-play political system means voters and small businesses are frozen out, Kabateck said. “Convicted teachers can’t even be fired. This is a huge step in political reform to make sure that politicians earn our vote.”

“What public purpose is served by this initiative?” asked Assemblyman Sandre Swanson, D-Oakland. Swanson demanded that Kabateck name the top five largest corporate contributors to the Prop. 32 campaign. When Kabateck answered “Charles Munger,” then hesitated, Swanson said, “You are not embarrassed by the supporters? I’ve seen the advertisements — are they correct?”

Before Kabateck could answer, Swanson continued, “This process needs to be transparent. The process should be transparent.” Swanson then mocked Kabateck and said, “I don’t want to tell you who is funding it.”

Only the day before at a legislative hearing about Proposition 30,  Swanson said, ”We are not running the state incompetently. We don’t have enough revenue.”

“The reason he can’t tell you who is funding this is it’s a corporation attached to the Koch brothers,” said Sen. Ted Lieu, D-Torrance.

“Let’s just be honest with the people,” Swanson added.

Swanson’s campaign contributions from labor unions total more than $381,000.

A little honesty

It was unclear why Swanson kept pushing Kabateck to name the top contributors to the “Yes on 32” campaign, as “No on 32” contributors already have thrown more than $41 million into the campaign to defeat Prop. 32, with nearly all contributions coming from labor unions.

Proponents have raised $9 million, of which $4 million comes from the American Future Fund, and $900,000 from Munger.

“Taxpayers are tired of getting the short end of the stick, and they elect all of you,” said David Wolfe. “If they truly believe what unions and corporations are doing, they can give freely.”

“Massive super PACs have taken over the entire political system. This is just flat out wrong,” Lieu said. “Unions are Democratic.”

Lieu’s campaign contributions from unions totals more than $435,000, and perhaps explains his vehement dislike for Prop. 32.

Opponents

“This is not what it seems to be, dressed up as political finance reform,”  said Trudy Schaefer of the League of Women Voters. “There are two sets of rules, but this is targeting one set of money. Super PACs will become the way of elections. Californians don’t want to see this.”

“Prop. 32 does not apply to LLC’s or super PACs,” said Derek Cressman of California Common Cause. “One in particular — American Future Fund — gave $4 million. Nobody knows them. But they are tied to the Koch brothers, and the thousands of consumer products they make. This will increase corporate influence and will not increase the democracy of labor unions.”

Armando Guerrero of the Sheet Metal Workers Local 104 said workers rely on unions to fight for them. “Like for FMLA and the prevailing wage they were cheated out of.” FMLA is the Family and Medical Leave Act.

“Can you imagine what this Legislature would look like with unrestricted contributions?” asked Willie Pelote with the American Federation of State, County, and Municipal Employees. “No matter what they do, we’ll never go away.”

After opponents spoke, Assemblyman Paul Fong, D-Cupertino, asked committee members if they had any questions. Silence. Not one of the remaining legislators asked the Prop. 32 opponents a question.

After the grilling Kabateck and Wolfe received from Bonilla, Swanson and Lieu, the legislators’ silence showed the lack of intellectual honesty at this hearing. They know where their bread is buttered.

Swanson said, “Voters can see through all this.”