How much would a Democratic supermajority in Sacramento matter legislatively?

Good morning. Happy Election Day. There are so many storylines today, but the one we’re paying the most attention to is the balance of power in the California Legislature.

True, Democrats will still control the Legislature no matter what happens. But we’re interested in individual races, like Lopez/Bocanegra, and in how many women will get elected, particularly in the Assembly. The main thing we’re paying attention to is whether Democrats achieve a two-thirds “supermajority.” 

While that would be a major disaster for Republicans politically — if it were to happen — it would likely have little effect on the legislative process if recent history is any guide. 

In fact, most of the larger defeats over the last year or so have been due to intraparty fighting. It was mostly moderate Democrats who last year weakened landmark environmental legislation, SB350. This year, they struck again when they initially killed a measure expanding overtime protections for farmworkers.  

In those instances, the moderates formed a majority with Republicans, which means both share the blame (or praise). But while Republicans often get blamed, the truth is that there aren’t enough Republicans to block most votes. It was Democrats solely who twice sank a Democratic bill expanding parental leave — once by a Democratic majority on a policy committee (possibly due to a grudge) and then a revived version was vetoed by the Democratic governor, Jerry Brown.

Democrats need to flip two seats in the Assembly and one in the Senate to get a supermajority — and it’s possible. With a supermajority, Democrats would have the power to increase taxes, override gubernatorial vetoes (which rarely happens) and change legislative rules without Republican votes.

CalWatchdog has more.

In other news: 

• Here’s a rundown of the more competitive races we’ll be paying attention to.

• Just a reminder how important the U.S. Senate race is, at least from a cultural perspective.

• Non-election news: “Cal State students next year might see the first tuition increase system-wide in more than five years,” reports the San Bernardino County Sun. 

• “Air quality regulators are investigating metal-processing facilities in the city of Paramount after detecting a potent cancer-causing metal at 350 times normal levels,” reports the Los Angeles Times. 

Legislature:

• Gone till December. 

Gov. Brown: 

• Voting this morning around 8:30 a.m. at the Boys and Girls Club, 1117 G Street, Sacramento, CA 95814

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According to a Public Policy Institute of California poll released Wednesday, a majority of Californians support government efforts to improve the environment, despite possible rises in energy costs and ongoing debates about the legality and effectiveness of the state’s environmental policies.

The study, which surveyed around 1,700 California residents about various environmental concerns, found that the majority of Californians supported existing plans to combat global warming, and were willing to expand these laws, even if that means paying more for gasoline and electricity.

“We find strong support today for the state’s greenhouse gas emissions targets set 10 years ago,” PPIC president Mark Baldassare said. “The commitment to help reduce global warming includes a surprising willingness on the part of majorities of Californians to pay higher prices.”

Big dreams for a cleaner California

Sixty-nine percent of Californians approved of plans to reduce greenhouse gas emissions to 1990 levels, as laid out in AB32, one of the state’s landmark environmental laws.

But government plans to reduce emissions have been met with mixed results. The cap-and-trade program, created by the Air Resources Board in response to AB32, places carbon emission limits on businesses and allows them to purchase credits for exceeding those limits. But at May’s quarterly auction, businesses purchased only 2 percent of the anticipated revenues.

The program faces legal challenges as well. A lawsuit by the California Chamber of Commerce claims the program is actually an illegal tax on businesses, requiring a two-thirds vote to become law.

Critics have complained about how the cap-and-trade revenue is spent – that the money doesn’t often fund projects that meet the required emission reduction goals. Assemblyman Adam Gray, D-Merced, said he is concerned about how the revenues are spent, calling the program “a feeding frenzy for a multitude of pet projects,” according to The Sacramento Bee.

And though there has been a decrease in greenhouse gas emissions, some say the lower levels may reflect outside factors like business scale-backs during the Great Recession.

“The jury’s really out on whether we’ve seen a lot of reductions caused by cap-and-trade,” James Bushnell, an energy economist at UC Davis, told the Los Angeles Times. 

Despite varied expert opinions, 54 percent of respondents in the PPIC survey approve of the cap-and-trade program – after the surveyors gave a brief explanation to the 55 percent who had never heard of the program before.

Respondents also support a proposed new law that would ramp up AB32’s plans to control emissions, which would exceed AB32’s reduction goals and extend the program to the year 2030.

And 58 percent of those surveyed believe local and state governments should devote more resources to other environmental issues, as well – electric cars, solar power and drought management.

A big paycheck for California residents

Californians know that reducing greenhouse gas emissions could raise energy costs – and they are ready to foot the bill.

The majority of respondents said they would be willing to pay more for gas (63 percent) and solar- or wind-generated electricity (56 percent). The Legislative Analyst’s Office estimates that gas prices would rise 11 cents as a result of the cap-and-trade program.

But this widespread support of energy reforms comes alongside equally widespread opposition by those who prioritize economic concerns over the environment.

How it’s playing in 2016

Alternative energy plans come with a cost – and according to Assemblywoman Cheryl Brown, the Inland Empire may not be able to afford it. In 2015, the San Bernardino Democrat opposed a petroleum-reduction provision of Senate Bill 350, another key piece of California’s environmental policy, citing concerns that potential rising energy costs could harm lower-income families.

However, some voters said Brown’s opposition amounted to a rejection of the entire clean energy campaign and retribution was swift. Protests, rallies and criticisms from other officials have threatened Brown’s re-election, while the campaign has become a proxy war between Big Oil and Big Environment. 

“Do you ever feel that something is not going quite right?” Brown asked the Los Angeles Times in March. “They are after me, and I still don’t know why. I don’t know who ‘they’ are. But I will find out soon.”

Concerns about the impracticality of California energy reforms are reflected in the PPIC survey, as well. The majority of respondents supported clean energy programs like electric cars and charging carports, with 68 percent in favor of tax credits for purchasing electric cars, and 77 percent supportive of infrastructure for charging the vehicles.

But less than half (47 percent) are actually considering purchasing an electric car themselves, suggesting that good intentions may not match up with environmentally conscious decisions.

There is consensus that California’s roads and highways must be fixed. There is no consensus how the fix should be paid for.

A Special Session legislative meeting Friday was called a first step in finding agreement to the funding problem. The Democrats see tax increases as part of the mix; Republicans want to prioritize the use of existing dollars for the roads. The tricky part of compromise is the push for any taxes in the context of so many other tax increases that could be presented to voters in 2016.

Governor Jerry Brown has proposed a yearly funding package for the roads of $3.6 billion. The package includes a 6-cent gasoline tax increase, an 11-cent diesel tax increase — both tied to inflation — a $65 car fee and cap-and-trade funds. His proposal is little more than half what legislative Democrats and a coalition of business, labor and construction groups have called for.

Republican proposals also include cap-and-trade money. In this case, the money would be used directly for the roads. The governor’s plan would funnel cap-and- trade dollars to bus lanes and rail. The Republicans also would trim CalTrans staff, direct weight fees and other transportation monies exclusively for the roads and employ other methods without raising taxes.

Not only have the Republicans expressed opposition to tax increases but there is no certainty that all Democratic legislators would support a tax increase.

The informal group of moderate Democrats who banned together to stop the provision to cut petroleum use in half over 15 years in climate change bill SB350 objected that their constituents would pay a higher cost for commuting. And cap-and-trade now covers gasoline refining and has raised the cost of gasoline about 10-cents a gallon. Additional taxes on gasoline would adversely affect many of their constituents, the moderate Democrats believe.

The governor wants the funding package to move through the Legislature quickly for strategic reasons.

For one thing, the plunging cost of gasoline may undermine the argument that the gas tax increase will hurt low-income drivers. Even a tax increase on gas would leave the cost of a gallon of gasoline well below recent price levels.

If debate lingers until next year, it becomes an issue for candidates running for office in an election year. Remember, a car fee increase was a major reason for a governor’s recall just a decade ago.

If a package of gasoline taxes and car fees should end up on the ballot it would likely get a cold stare from the voters. Likely there will be a number of tax increases on the November ballot. An extension of Proposition 30, a cigarette tax, perhaps a property tax, maybe others could be on that ballot. A roads funding package will not look so good in the context of all these tax increase proposals.

The roads and highways are the veins and arteries that pump life into our economic system. They must be cared for to prevent the economic system from getting a form of man-made sclerosis. The governor and legislators during the Special Session are walking a tightrope to balance the need to improve the roads and highways with voters being turned-off by a slew of tax proposals.

Brown also said the problem is so complex that it’s likely no one knows how to solve it.

Emissions Targeted

The governor conveyed his warning at the California Air Resources Board’s Oct. 1 workshop, “California Climate Change Scoping Plan: 2030 Target.”

The 2030 target reduces California’s greenhouse gas emissions to 40 percent below 1990 levels in the next 15 years. Brown also designated a 2050 target: emission reduction to 80 percent below the 1990 level.

The 2030 target is “the most aggressive benchmark enacted by any government in North America to reduce dangerous carbon emissions over the next decade and a half,” said Brown in an April 29 statement.

The governor began his remarks at the workshop with an admission of ignorance on climate change science.

“I come today because this is a topic that is not easy to grasp,” he said. “It’s complicated. The more you dig into controlling air pollution or measuring greenhouse gas emissions or attempting to understand the [climate] models that examine and attempt to predict how world climate patterns will change over time, it definitely is a very complicated science that we mere lay people just get little glimpses of.”

That complexity makes it easy for climate change skeptics to disseminate misinformation, according to Brown.

“It allows people who have bad motives or soft minds to then raise doubts that are not based on science or facts, but are able to be communicated without people reacting with total ridicule,” he said. “And it takes enough knowledge that it’s hard to be in this conversation at any level of depth.

Relying on Climate Scientists

Brown said we should rely on climate change scientists who “have clearly stated that human beings and the industrial activity of our modern lives is affecting climate by building up heat-trapping gases, and that the effects over time will be catastrophic.”

“When and how all of that unfolds is something that cannot be said on a precise date,” he continued. “But we know with a high degree of confidence that we are facing an existential threat to our well being and the well being of the generations that come afterwards.”

Brown acknowledged that the public has thus far been largely indifferent to the climate change issue, ranking it well below crime and jobs among issues they are most concerned about. That indifference or ambivalence may be due to the omnipresence of fossil fuels in the quality of our lives.

“What we are looking at is making a shift in the way life shows up,” Brown said. “We are who we are because of oil, coal and natural gas. Fossil fuels is what makes it. I assume that most of the people here are here because fossil fuels got you here, clothed you, medicated or whatever way you are functioning as a modern person, you are dependent on fossil fuels.

“So when we say we are going to reduce [emissions by] 10 percent, 20 percent, 40 percent, we are setting forth a huge challenge that is very easy to state. But anybody who has any understanding of what is implied by what is being called for, realizes this cannot be done lightly or without a mobilization globally that we have never seen before outside of time of war.”

Potential Economic Meltdown

Brown, citing a Sept. 29 speech by the Governor of the Bank of England Mark Carney, warned there is a potential for a global economic meltdown when energy companies are forbidden from using up to a third of their fossil fuel resources.

“Once it becomes conventional wisdom, once we get it that climate change is going to be catastrophic and that becomes clear and vast majorities of people at all levels of society agree with that, it may be too late because we’ll be too far down the road,” he said.

“If the oil and gas companies are undermined, the financial system itself can be undermined. We can’t wait until everybody gets it. We have to start now.”

Brown said the state’s current annual output of 460 million tons of carbon dioxide-equivalent emissions must be reduced to 431 million tons by 2020 and down to 260 million tons by 2030.

“To go from 460 where we are to 260, that takes heroic effort, scientific breakthroughs, massive investments, a lot of cooperation and a political understanding that does not exist today,” he said. “So this is not stuff for amateurs. This is quite challenging.”

“It’s a political problem,” Brown continued, “but also it’s a technical problem. And it’s going to require a lot of breakthrough, a lot of research and billions, tens of billions of dollars, invested by many, many different sources.”

It will also require Californians driving a lot less, he said, by living closer to where they work and telecommuting. “Californians drive over 330 billion miles a year – 32 million vehicles of various kinds moving around on almost entirely fossil fuel,” he said. “We’re going to reduce and take fossil fuels out of our lives and out of the economy.

“And we’re going to creep our prosperity and ability to keep inventing and improving the quality of everybody’s life. And not only here, but we’re going to do it all over the world. And we’re going to add a couple billion people besides and probably another billion cars.”

Changing Lifestyles

The governor admitted, “How the hell we do that, probably nobody knows. But the people who have the best understanding and the best capability to do things [are] right here.”

Brown acknowledged that it will be a big challenge convincing people to change their lifestyles. He also admitted that even getting the conversation started is tough:

In my world of politics this is … a dark reality that you just can’t even talk about. Because it’s too obscure, too complicated, it’s not high in the polls, “don’t bother me now.” But if that mood persists … it will be too late then, and there will be a real catastrophe.

People don’t like to think that something horrible could happen. We all like our happy time news in the morning. But you got to see it, and then we have to take steps to make sure it doesn’t happen.

This is about taking the steps to deal with fuels, the investment in biofuels, [energy] efficiency in appliances and buildings, across the whole range of how our modern civilization works, within the limited reach that the Air Resources Board has confidence and the legal authority to do, which is quite a lot. Everything that can be done will be done. California will do what it has to do.

Leading the Way

Brown believes California is setting an example other states and countries will follow.

“People know about California, people are watching what’s going on, and there’s a lot of goodwill to get us to the goal,” he said. “Of course, it’s going to take a lot more than goodwill. It’s going to take billions, trillions of dollars. And it’s going to take commitment all over the world.”

Brown’s pep talk received a standing ovation. After the applause died down, CARB Chairwoman Mary Nichols said, “You can see why I get up raring to go to work every morning.”

Facing Opposition

No one at the workshop questioned whether California’s efforts will do much to prevent the planet’s climate from changing, and whether the cost will be worth it.

But state Sen. Andy Vidak, R-Hanford, issued a statement on Oct. 7 in opposition to Brown signing into law Senate Bill 350, which mandates an increase in renewable energy among other emission reduction actions:

The district I represent is still reeling from the Great Recession and the devastating years-long drought. Too many people in rural and inland communities are impoverished; standing in food lines because they can’t find work to make ends meet.

Senate Bill 350 is a devastating measure that will force already-struggling families deeper into poverty by drastically increasing energy costs that are already some of the highest in the nation.

It’s wrong when parents have to choose between the necessities of keeping the lights on and feeding their children. The governor’s signature on SB350 kicks folks while they are down. It is a selfish gesture designed to fluff up his “legacy” and pander to coastal elites’ “environmental” self-righteousness.”

The impact on most Californians from the state’s climate change regulations has been minimal thus far. The state has been averaging a 1 percent reduction in greenhouse gas emissions annually. That pace is projected to continue through 2020, and is enough to meet the 2020 reduction goal.

But residents and businesses will be hit harder after that. Emissions will need to be reduced by at least 5.2 percent annually from 2020 to 2030 in order to meet the 2030 target.

“This gives an indication of the challenge of the work that we have ahead of us in the scoping plan to develop an approach, to develop a set of measures that can contribute to and achieve this ambitious greenhouse gas reduction level for 2030,” said ARB Assistant Executive Officer Michael Gibbs.

An analysis of the economic impacts of the climate change regulations will be conducted as a part of the scoping plan. No cost estimates were provided at the workshop, but several officials in addition to Brown said that billions of dollars in increased funding will be required.

“Investment in [energy] efficiency [in buildings] will need to be quadrupled or quintupled from today’s levels in order to reach the scale necessary to meet the 2030 and 2050 goals,” said Patrick Saxton, representing the California Energy Commission. “Clearly this is much more than ratepayers and taxpayers can fund on their own.”

Regional workshops on the scoping plan will be held this fall; the Air Resources Board will receive an update on Nov. 19. The draft plan is scheduled to be released in spring 2016. The final plan is expected to be approved in fall 2016.

Looking at the results of the California Business Roundtable/California Manufacturing & Technology Association poll on Senate Bill 350, the new climate change policy being considered in the CA Legislature, you can almost see how campaign arguments would be formulated if the hotly debated bill were on a ballot for voters to decide.

The poll conducted by M4 Mobile Research clearly showed that the public at large supports the goals of reducing greenhouse gases. While 82 percent of those polled consider climate change a serious or moderate threat to the state, when the components of the bill are tested the support remains strong.

Cutting petroleum use by half in cars and trucks by 2030, requiring 50 percent of the state’s electricity to come from renewable energy sources and doubling energy efficiency in buildings over the next 15 years enjoyed overwhelming support, all three items tested in the 70^th percentile. Overall, SB350 was favored 66 percent to 27 percent.

However, the overall number turned around when the potential cost was addressed by the pollster.

After testing a wide range of specific arguments from positive to negative on the measure — i.e.: California must lead on climate change issues; implementing this legislation will lead to positive innovation; price of gasoline could increase 13 to 50 cents a gallon; electricity rates could jump 30 to 70 percent; disadvantaged citizens will be particularly hard hit by the change – the respondents were again asked if they supported or opposed SB350.

Support dropped from 66 percent to 44 percent, opposition increased from 27 percent to 48 percent.

Rob Lapsley, head of the California Business Roundtable summed up the poll succinctly when he said, “costs matter … details matter.”

The details of how to achieve the goals expressed in the bill are not contained in the measure.

Dorothy Rothrock said manufacturers in her association are feeling the pinch from electricity costs associated with climate change laws already on the books and can see incredible increases in the future if this bill passes in its current form.

Which leads to speculation, will this fight spill out of the capitol building and on to the ballot?

If the bill is passed and signed by the governor, will a referendum effort be mounted to ask the voters to decide – those voters who embrace the idea of a clean environment and climate change legislation but are leery of what the costs would mean for the economy, jobs and low income citizens?

The poll indicates that the arguments are lined up to produce quite a donnybrook if the voters are consulted.

A number of large business organizations have offered support for funding sources to be used for transportation infrastructure purposes on one hand, while on the other strongly opposed both general and specific tax measures such as a property tax increases on commercial property (SCA5) and making it easier to raise local taxes (ACA4).

Some in the business community probably hope that support for transportation revenue may be balanced with other tax measures and other bills meeting a dead end.

The focus on the minimum wage issue, so recently debated in cities and counties, will come back to the state capitol (Senate Bill 3) along with concerns for rising workers compensation costs. Capitol-centered business interests will argue a double whammy on the economy with minimum wage increases and rising workers comp costs. They will try to find a solution to workers comp increases while leaving the politics of minimum wage to local jurisdictions.

The saga of environmental regulations and the resulting costs imposed on businesses will continue to be played out, especially focused on fuel costs if petroleum reduction measure SB350, and an increased greenhouse gas regulation (SB32) become law.

The California Chamber of Commerce is monitoring its list of Job Killer bills as it does every year.

Business is not a monolith, however. Small business and big business may express different views and even within these broad business categories there are differences of opinion. That could complicate the drive to find common ground with the Legislature and governor.

Business often survives on the art of the deal – a negotiation that leads to a gain for both sides of the negotiation. Similarly, government is said to advance on the art of compromise. So will broad business interests achieve certain goals while satisfying the powers-that-be under the capitol dome?

You can bet the discussions are already taking place. As to the results — we shall see.