The Bay Area Council today released the results of the Summer 2010 Business Confidence Survey. It shows a slight downturn in business confidence and hiring this quarter. Even though we’re seeing a downward trend in business confidence in this survey, the strength of the Bay Area economy continues to provide optimism to CEO’s and executives. Overall, the Bay Area economy is in better shape than it was six months ago. However, uncertainty about what lies ahead continues to affect the key indicators, such as hiring. The Bay Area needs to continue pushing for smart, business-friendly policies that encourage hiring to pull our region out of the recession. The initiatives and policies that we are focusing on at the Bay Area Council, such as supporting infrastructure projects and financing for sustainable energy will help move the Bay Area economy in the right direction.

Learn More:
Press Release
Results
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Please join us for the next info session for the USC Ross Program in Real Estate, presented by the Bay Area Council. We will be joined by Ross Program alumni as well as Connie Moore, President & CEO, BRE Properties, who will be speaking on “The Changing American Dream.”

Tuesday, September 21, 2010
6:00 - 8:00 PM
at the offices of the Bay Area Council
201 California St., 14th Floor, San Francisco

Please RSVP to: bflores@bayareacouncil.org or 415-946-8729

About the Ross Program:
The USC Ross Program in Real Estate is a comprehensive educational program for the working professional to elevate skills and expand understanding of real estate development and investment, while building the networks necessary to succeed in urban renewal. The nine-day program will be held between November 11 and December 4.

On Sunday, Governor Arnold Schwarzenegger joined Bay Area Council President & CEO Jim Wunderman to announce that California will bid to host the 2020 World Expo in Silicon Valley. The announcement was made at the World Expo in Shanghai before the Governor toured the U.S., Austrian and Chinese pavilions. World Expos typically occur every five years and attract exhibits from countries around the globe and bring as many as 70 million visitors. The Governor and Council will work together to bring this prominent international event to the Golden State.

"Shanghai has demonstrated that when you host the World Expo, the world comes to you, and I want the world to come to California. Our state is a leader in entertainment, agriculture, the environment, high-tech, green-tech and bio-tech, and we are ready to showcase our innovation to the world," said Governor Schwarzenegger. "As the hub of innovation, Silicon Valley is the most natural place to hold the Expo, which will promote the international exchange of ideas, create jobs and increase revenues in our state."

The proposed site is Moffett Field, next to the pristine San Francisco Bay. The area is heavily served by international and local transportation and is surrounded by some of the largest and most respected companies in the world.

"The World Expo is the Olympic Games of the economic, scientific and industrial world, and we think it is time for Silicon Valley to serve as an ambassador for the United States and host this event," said Jim Wunderman, President and CEO of the Bay Area Council. "For 30 years, the Bay Area and Silicon Valley have been the pre-eminent hot spots for the innovation that drives the world's technological advances.  Imagine what a Silicon Valley Expo will look like when we put all of the region's collective brainpower to work."

World Expos can generate tens of thousands or even hundreds of thousands of jobs for host regions.  Shanghai's World Expo will leave the city with an additional $40 billion of roads, subway lines and airport terminals.  The net economic impact for the Shanghai Expo has been estimated at $11.6 billion, according to Chen Xinkang, professor of marketing and business management at the Shanghai University of Finance and Economics.

The State of California and the United States will submit their formal Expo 2020 candidacy application in 2011 and the Bureau of International Expositions (BIE) - the governing body of World Expositions - will likely announce the winning bid for Expo 2020 at the end of 2012.  Currently, the United States is not a member of the BIE. The Bay Area Council plans to work with Congressional Representatives and the U.S. State Department over the next few months to reinstate the U.S. as a contributing member.

The last Expo that was held in the United States was in 1984 in New Orleans.

Nancy Sutley, Chair of the White House Council on Environmental Quality and principal environmental policy adviser to the President, stopped by our offices this week for an engaging discussion with Bay Area Council members. Sutley tackled many issues important to the Bay Area, including the challenges of sea level rise and climate change in the Delta region.  Sutley also pointed to the increased level of engagement by the federal government in addressing the decline of the Bay-Delta, namely the creation of a Federal Leadership Committee on the Bay-Delta co-chaired by her and Ken Salazar, U.S. Secretary of the Interior.

Sutley also discussed the new efforts the federal government is working on with the California Air Resources Board (CARB) to implement new standards for trucks. Additionally, she mentioned that the Environmental Protection Agency (EPA) will soon be releasing a report that will provide scientific monitoring tools to local and state governments to help adapt to climate change. We look forward to working closely with Nancy Sutley and the Obama administration on these, and many other issues in the coming months, to improve the quality of life in the Bay Area.

Over the weekend, I had an Op-Ed in the San Jose Mercury News that is essentially the tip of the spear of one of the Council's next major pushes.  Right now I can't reveal too much, but everyone in the region should definitely stay tuned in the next couple of weeks for more details.  In the meantime, check out my Op-Ed.

***
Lately, it seems like you can't read a newspaper, turn on the TV or go online without hearing about China's rise and America's demise. Whether it's China overtaking Japan as the world's second largest economy or the Agricultural Bank of China having one of the biggest IPO's in history, the story inevitably is about China.

Yes, China is gaining influence around the world. Yes, China is growing in stature. If we are smart, we will embrace it. Our organization just opened an office in Shanghai to help our region's business succeed in China, and we're leading a delegation with Gov. Arnold Schwarzenegger in September to grow our exports to that country.

But China's rise doesn't mean we're giving up here in the States. Quite the contrary. We can, and should, learn a lot from our Chinese partners. A great example is the Shanghai World Expo.

Just look at what Shanghai has been able to accomplish this year with its Expo. When everything is said and done, more than 70 million people from across the world will have attended. The city captured the world's attention for six months and used billions of dollars generated by the Expo to build new subways, rail lines, ferries and other infrastructure projects. The Expo has been Shanghai's stimulus package.

In a world where a strong global image is a key asset, world expositions are once again a vehicle for "region branding." Apart from cultural and symbolic reasons, organizing countries - and the regions hosting expos -- can use the event to share their best thinking, companies and culture on a global stage. China has certainly done this.

Silicon Valley and California can and should too.

It's time we lay a marker down and start to make a bid for the 2020 Expo to come to the Bay Area. Think about the possibilities.

Expos are about showcasing your region and its qualities and how they fit into a common vision for the future. For 30 years, the Bay Area and Silicon Valley have been the pre-eminent hot spots for the innovation that drives the world's technological advances. Our region already has everything we need: innovation, creativity and technology, plus leadership in sustainability.

Another plus for a Silicon Valley Expo is that, unlike an Olympic bid, the exhibit is tied to commerce, not sports. Instead of building massive sports arenas and stadiums, we would allow countries to create international pavilions -- buildings we can keep or demolish -- and upgrade existing infrastructure that would benefit the region for decades after the Expo is over.

Perhaps we could even create a Silicon Valley campus for the University of California, for free! Everything that's built could be used for a whole multitude of purposes, whether academic, business-related or nonprofit. And since the Bay Area is already working on getting high-speed rail from San Jose to San Francisco, perhaps an Expo would be the right ingredient to get that project over the finish line in a way everyone can agree on.

We've done it before. In 1915, San Francisco hosted the Pan-Pacific International Exposition, primarily to showcase that San Francisco was back and fully recovered after the 1906 earthquake. We have the chance to do the same thing right now after enduring an economic earthquake.

If we were able to invent the microchip, the iPhone, biotechnology and the search engine, we can also lead America's way to prominence and respect once again.

Shanghai used its Expo to show how China has arrived on the world stage. Let's make a bid for 2020 and do ours to show we are not leaving it.

For those who didn’t catch this last week, here is my op-ed on “economic uncertainty” that was published in the San Francisco Business Times.

"Health care reform. New financial regulations. A lack of consumer spending. Add them up and businesses all around the country are feeling beat up right now. If you listen to the nightly news, it’s the stomach- churning ebb and flow of the Dow that is keeping CEOs up at night. It’s not. It’s uncertainty.

Most CEOs will tell you that they can’t predict when they’re going to hire again because they still don’t know how much of a hit they’re going to take from all the new government regulations, and they don’t know what’s coming next. Compounding the problem, consumers who are nervous about their financial situation are tightly holding on to their wallets. Facing less revenue, executives are trying to stay afloat by increasing productivity and saving their cash until consumers start spending again. It’s this paralysis that is keeping investment on the sidelines.

As we speak, state regulators are writing health care rules that will greatly affect how large and small companies do business. With a 1,990-page health care reform bill, the amount of rules and regulations coming down the pike are virtually unquantifiable. The recently passed financial regulation bill on its own creates over 350 new rules, 47 studies, 74 reports and a huge consumer protection agency. Without a clear picture of what lies ahead, executives are content sitting it out until there’s more certainty.

That’s why President Obama should light a fire under regulators to get them to release the new rules soon. Businesses understand that the playing field has changed and that there is a new reality they’re going to have to work in. They just need concrete details so they can start to account for those changes.

Obama and Congress also need to send clear signals to businesses that they will take reasonable, proven steps to get them to start hiring. Tax credits and other incentives should be offered to American businesses that put Americans back to work.

Right now, businesses need a stable and predictable environment. They need a commitment from government that they will not be taken for granted. They need the American people to spend, so they can expand. Ultimately, no one is in a position to wait any longer though.

Our economy hangs in the balance."

Today, I joined stakeholders and elected officials from Peninsula cities to tour the Peninsula rail corridor and discuss issues related to the future California High-Speed Rail.

The tour, hosted by Assemblyman Jerry Hill, D-San Mateo, was convened in response to a July 29, 2010 letter from Bay Area Council President & CEO Jim Wunderman that expressed concerns about an attempt by five Peninsula cities to slow down the implementation of high-speed rail.

The tour also came on the heels of Transportation Secretary Ray LaHood declaring this week that California is, “…way ahead of the curve on high-speed rail,” and High-Speed Rail Authority CEO Roelef van Ark remarking that, “If you don’t get the environmental process done by September 2011, you won’t get the funding…”

After today’s tour, I issued the following statement:

“Those who oppose high-speed rail understand that delay is their best weapon to kill the project.  There are ways to resolve issues and there are ways to stop progress.  We greatly appreciate Assemblyman Hill’s effort to bridge the differences amongst his constituents.  However, the cities of Menlo Park and Atherton are continuing to move forward with a challenge to the environmental impact report of the San Francisco-San Jose portion of the high-speed rail line.   

We refuse to stand by and let two small cities de-rail this historic multi-billion dollar project.  By slowing the environmental process down, Menlo Park and Atherton are trying to run out the clock on high-speed rail.

We understand the concerns of Peninsula residents and we are sensitive to their apprehension about having high-speed rail in their community.  But we need to remember that Prop 1A was supported by over 60 percent of San Mateo and Santa Clara County voters, and statewide it passed with over 53 percent support.  The people of California and the Peninsula are counting on all of us to deliver.

Last Friday, I sent a sharply-worded letter to a Peninsula group that poses a threat to the Bay Area's plans for high speed rail. High speed rail is too important to let a small, vocal minority decide its fate.

Here's the text of what I sent:

July 29, 2010

Mayor Cathy Baylock and Councilmembers, City of Burlingame
Mayor Patrick Burt and Councilmembers, City of Palo Alto
Mayor Richard Cline and Councilmembers, City of Menlo Park
Mayor Kathy McKeithen and Councilmembers, Town of Atherton
Mayor Christine Wozniak and Councilmembers, City of Belmont

Dear Mayors Baylock, Burt, Cline, McKeithen, and Wozniak, and Councilmembers:

I am writing to you regarding your cities’ and the Peninsula Cities Consortium’s obstructionist policies towards California high speed rail and the grave danger that they pose for our state. As a former public official who served two San Francisco mayors, I have the greatest respect for the dedication, responsibility, and authority of local government leaders such as yourself, and it is with some regret that I critique your leadership. I have concluded, however, that there are much larger issues at stake and that it is appropriate and necessary that I convey to you the strongly held concern and recommendation of the Bay Area Council.

In characterizing your cities’ policies as obstructionist and dangerous, I do not mean to impugn your motives, which I am entirely confident are only to best serve the interests of your local residents. Yet the fact remains that the policies and actions that your cities are pursuing are serving to obstruct and undermine a project that is quite literally of historic importance to the residents of the Bay Area and California. To say, as does your Peninsula Cities Consortium, that “high speed rail should be built right or not at all,” and that cost analysis should play no role in determining alignment, is to say that the project need not, should not, and will not be built.

You are, I trust, as aware as anyone of the importance of high speed rail to the State of California and of the environmental, mobility, and urban revitalization benefits that it will bring. You may not, however, be entirely aware of the extent to which your cities’ demands endanger the project and bolster the advocacy of the very small and very vocal minority of Californians who cannot be satisfied unless high speed rail, and Caltrain with it, is killed. 

Let me point out to you the support that the Proposition 1A high speed rail bond measure enjoyed among your neighbors and constituents in the November, 2008 election. Statewide, it passed with 53 percent support. In San Mateo County it earned 61 percent approval and in Santa Clara County 60 percent support. Within the cities of your Peninsula Cities Consortium—the voters that you represent—Proposition 1A was embraced by 61 percent (46,023 yes - 29,242 no). Such overwhelming public support from your citizens for high speed rail makes it appear extremely unlikely that they would want their city to be the one standing in the way of the project coming to fruition.

Respectfully, you may also under-appreciate the staggering toll of unemployment and economic distress on millions of California families of modest means. Though your communities, like other high-wealth communities in the state, have escaped the brunt of the Great Recession, 2.3 million unemployed Californians are not as fortunate. For these struggling Californians, $4 billion of near-term high speed rail construction expenditure would be lifesaving. 

There was, no doubt, a period in American history in which government infrastructure planners ran roughshod over the interests and welfare of residents and communities. Thankfully, this era is behind us, but it has been replaced by an era in which too many public officials believe that no project can or should be built unless there is universal approval of the public. Overwhelming public support with large and widespread public benefits are somehow offset by the vocal opposition of a single individual. In the case of high speed rail, a small handful of individuals in a small handful of neighborhoods in a small handful of communities raise a seemingly endless series of complaints and objections and threaten to halt the construction of a project of generational significance, and immediate economic survival, for this state and its residents.

This is not why I went into public service, and I don’t believe that it is why you went into public service. You likely were motivated, as was I, by the belief that public officials can be powerful and effective leaders to improve the public welfare. Public leadership, however, requires more than hearing and representing only the loudest voice in the room. It takes leaders who look to the future rather than the past, who throw their energy into making positive change happen rather than preserving the status quo, and who stand confidently in support of progress even when critics fling arrows. California once stood at the forefront of social progress—recognized as the nation’s leader in higher education, research and development, environmental protection, and job creation—and deserved to be called the Golden State. Today, after decades of holding progress hostage to the unachievable ideal of “universal consensus,” the Golden State moniker is used only to show how far we have fallen. 

This failure of leadership did not originate with the emergence of high speed rail, and it isn’t limited to your cities. Far from it. But high speed rail is where the politics of paralysis must end. After decades of inaction, California is finally, with high speed rail, taking a step worthy of a Golden State. It is a first step and a crucial test of whether California can once again establish and execute a bold statewide vision for the general benefit of the state and its residents. If the answer is no—if Californians choose to remain bound by the politics of paralysis—then look for status quo trends to continue, with the tragic consequences that this entails for our schools, public facilities, economy, employment, livability, and, ultimately, the lives of the state’s citizens. This is not the future that I want to see, and I doubt that it is the future that you want. And I deeply believe that in approving the Proposition 1A high speed rail bond, Californians were sending a message that they too are ready for California to rebuild itself and restore the dream of the Golden State.

I urge you to step back and re-evaluate your cities’ positions on high speed rail. Look again at the benefits—economic, environmental, urban revitalization, jobs, mobility—that high speed rail offers to the citizens of California. Watch An Inconvenient Truth. Visit with unemployed construction workers. Consider the need to restore the Golden State for our children. And ask yourself if you can in good conscience advocate that “not at all” is your position on high speed rail unless every demand of every member of your community is met in full. 

Sincerely,

Jim Wunderman
President and CEO

cc: Board of Supervisors, County of Santa Clara
Board of Supervisors, County of San Mateo
City Council, City of Belmont
City Council, City of Burlingame
City Council, City of Menlo Park
City Council, City of Palo Alto
City Council, Town of Atherton

Last week, the Bay Area Council and the Alliance of CEOs brought together CEOs from across the region for a roundtable discussion on “Doing Business in China Today.”  Having just opened our new office in Shanghai, I shared my first-hand insights and tips with the group.  Much of the discussion centered on the business culture in China and how Chinese businesses put a premium on established relationships and working through Chinese partners.  Since the Council already has boots on the ground in the Yangpu District of Shanghai and established ties to the Chinese Party Secretary, it was a great venue to highlight our upcoming trade mission to China with Governor Schwarzenegger in September.  And with China passing the U.S. as the world’s biggest energy user this week, the imperative for American companies to set up shop over there is only growing.

The Bay Area Council is conducting a forum on AB 32, California’s Global Warming Solutions Act of 2006, tomorrow, Thursday, July 22.  Supporters and opponents of AB 32 will present their arguments, and Proposition 23, the ballot measure to repeal AB 32, will be discussed at length.  Leaders from business, academia, environmental groups and politics will be voicing their opinions on AB 32.

“With Proposition 23 on the ballot this November, the stakes are high for California,” said Jim Wunderman, President & CEO of the Bay Area Council.  “This forum will be a lively discussion about AB 32’s impact on the economy, jobs and climate change.”

WHO: Jim Wunderman, President & CEO, Bay Area Council

Professor W. Michael Haneman, Chancellor's Professor, Department of Agricultural &   Resource
Economics, University of California at Berkeley

Aaron Singer, Managing General Partner, Pacific Carbon Exchange

Dave Fogarty, Yes on Proposition 23 campaign

Donald Simon, Attorney, Green Business Practice, Wendell Rosen Black & Dean, LLP

WHAT: Forum discussing AB 32 and Proposition 23, with supporters and opponents presenting arguments.

WHERE: Wendel Rosen Black & Dean, LLP  
                 1111 Broadway
                 19th Floor               
                 Oakland, CA 94607
                 (Office is located near 12th Street/Oakland City Center BART station)

WHEN: 4pm – 6pm
               Thursday, July 22, 2010

If you plan on attending, please RSVP to Blythe Goodell at bgoodell@bayareacouncil.org. All media planning to attend should RSVP to jarellano@bayareacouncil.org, (415) 946-8725.

Today, the Bay Area Council Economic Institute released "The America's Cup: Economic Impacts of a Match on San Francisco Bay." The report can be accessed here (5 MB).

At the end of 2006, recognizing that most of the Council’s members have operations in about 20 of the same regions on the planet, the BAC created a “Global Competitiveness Strategy.”  The strategy was designed to extend the Council’s reach and open up an international front to take advantage of the new globalized economy.  The Council started with the Shanghai-Yangtze region of China because of historical ties, current economic links and the phenomenal growth potential.

First there were delegation visits and conferences, delving into such issues as green-technology and venture capital. Those evolved into what the Council proudly announced last month: a fully operational and permanent trade office in Shanghai’s dynamic Yangpu District.  Along the way, many of our members have deftly parlayed the Council’s visits into serious money making and employment boosting opportunities.  Just like China, the relationships have grown at lightning speed – from simple meet-and-greets to strong connections with the top business and government leaders of the Shanghai- Yangtze region, and beyond. 

In September, we expect to cross a new threshold, when Governor Schwarzenegger and top Chinese leaders join us at an event codifying a 4-Point Economic Agreement currently being negotiated.  The visit will also celebrate the opening of offices in China by some of our local companies, as they capitalize on the Chinese market and sell their products and services.  This matters profoundly.  The relatively anemic economic turnaround in California and the rest of the United States has made accessing the China market critical to our economic recovery.  If you or a company you know are getting ready to expand in China, you should consider joining our delegation to China in September. If nothing else, it will be a great way to start practicing your Mandarin.

The magnitude and complexity of the challenges facing California public schools is no secret. California’s public education system is not only one of the nations largest and most diverse, but is also one of the lowest funded per pupil. Despite recent “silver bullet” attempts at reform, drop-out rates and poor performance on standardized tests continue to plague the system.

Recognizing the status quo as morally and economically unacceptable, education stakeholders across the state have been mobilizing to find a comprehensive, sustainable solution. As part of the Race to the Top second round application, experienced superintendents have been meeting to discuss and plan innovative strategies to improve college-readiness in their districts. Despite shrinking budgets, these leaders plan to meet the challenge of preparing every student for a career or college head-on.  

On Tuesday June 22, The Bay Area Council hosted a meeting between these superintendents, other education reform leaders, and Dr. Jerry Weast of the Montgomery County School District in Maryland. Dr. Weast has been leading a dramatic transformation in student achievement in Montgomery County for the past 11 years, boasting an unprecedented reduction in the achievement gap while simultaneously improving student performance at all student levels. Since Montgomery County has similar characteristics to many Californian districts, Dr. Weast shared his experience and strategy with the group.

It was clear from the meeting that while challenges persist and grow for public education, California has the leadership, talent, and drive to drastically improve student outcomes. However, turning California’s public education system around will take leadership on several levels and partnership across sectors. The Bay Area Council has been a leading voice for education reform in California and views the business community as an invaluable player in the future of California public education.  

Watch the video clip below to see a portion of Dr. Weast's presentation.

This week, Governor Schwarzenegger was generous enough to send a video message to the Bay Area Council delegation in Shanghai for the opening of our China office. The Governor touches on many themes of great importance to California and the Bay Area, including investment, innovation and job creation. Thank you to Governor Schwarzenegger and his staff for their continued support of the Bay Area Council. Check out the video below.

California’s education system is broken to the point that many observers don’t believe it can actually be fixed.  We plunged from first in the nation to worst in a generation; a precipitous decline by anyone’s standards.  Statistics vary depending on who is producing them, but across the board California consistently ranks at or close to the bottom in student funding, student performance, and teacher/student ratios.  We also rank at or close to the top in students qualifying for free or subsidized meals, students who speak English as a second language, and total student population size.  In short, our needs are great and our resources not so much.

Faced with such sobering statistics, it is not hard to side with the pessimists, raise the white flag, and declare the problem unsolvable.  That, however, is not an acceptable option.  California is a knowledge based economy and it is the public education system that previous generations built that made this State the economic powerhouse that it is today.  Consigning a whole generation of California children to failure will produce a pig in our education python that will eventually materialize in an inability for California employers to compete for talent in the global marketplace, higher dependence on state welfare programs, and higher rates of incarceration.  In short, a recipe for disaster.

The Bay Area Council has been a leading voice for education reform in California, and in particular the need for early education, birth to third grade, to be a component part of any effort to repair California’s ailing public education system.  There are many other stakeholders in this reform effort and while we all agree what the problems are, we have rarely reached consensus on what the solutions might look like.  All that may have changed thanks to a trip co-hosted by the Bay Area Council to Montgomery County Maryland, and Washington DC this week.  Joining us on the trip were six School Superintendents, Department of Education representatives, representatives from the California Teachers Association, the California Federation of Teachers, members of the State Legislature, early education advocates, and business leaders from around California.

Our first port of call was Viers Mill Elementary School in Montgomery Country, Maryland.  Viers Mill is one of the top performing public schools in the country, yet faces exactly the same challenges that exist in California, with 65% of students qualifying for free meals, 30% speaking English as a second language, (32 different languages spoken by students) and a student mobility rate of 22%.  Montgomery County schools outperform California’s in orders of magnitude, yet its per pupil spending, while more, $11,724 compared to $9,152, is not so much so as to be the primary driver of its success.

We saw that driver later in the afternoon in the person of County School Superintendent Jerry Weast.  A no nonsense, pragmatic, larger than life individual with an obvious passion for public education and an intensity and focus that was contagious.  Superintendent Weast turned around his struggling district with a simple formula: set an objective, map a path to get you there, empower your teachers, and don’t let anyone get in your way.  It is clearly working.

We saw first hand what the light at the end of California’s education tunnel looks like.  A school district with similar demographic and fiscal challenges to California performing what can only be described as miracles. Using a data driven model, they are leading the nation in preparing kids for college.  The whole delegation, business, labor and educator alike agreed that while Jerry Weast cannot be cloned, his plan can, and it could work in California schools.

The next day in Washington D.C. we took our unified message and newfound optimism to Senator Dianne Feinstein, Speaker Nancy Pelosi, Representative George Miller, and Roberto Rodriguez Special Education Advisor to President Obama. We impressed upon them the need for an integrated seamless and data driven birth to college education model. 

Special thanks to Randy Ward, Superintendent of San Diego Schools for co-chairing the delegation with Jim Wunderman, Ken McNeely, Chair of the Bay Area Council Early Childhood Education Committee, and the Packard Foundation for making it all possible.

The Creating Tomorrow’s Leaders Program is at the core of the Bay Area Council’s commitment to education and to investing in underserved communities in the nine-county Bay Area. The program currently helps 60 low-to-moderate income (LMI) scholars realize their goal of achieving a post-high school education—often as the first one in their families to graduate from high school, let alone college.  These students possess an intimate awareness of the challenges faced by residents of LMI communities and are passionate about making a positive impact on their communities.  Through supporting their college education with scholarships, mentoring and leadership workshops, the Council and its partners are helping them become the most capable leaders that they can be—for today and for tomorrow.

The program is in alignment with US Bank’s mission and goals in education. As Lisa M. Joyner, Vice President in U.S. Bank’s West Region Community Affairs department shared in announcing the grant award, "U.S. Bank is excited to support The Bay Area Council's Creating Tomorrow's Leaders program.  This program is aligned with one of U.S. Bank's funding priorities: education. We support innovative programs that help low-and moderate income students succeed in school and prepare for post secondary education.  We appreciate The Bay Area Council's dedication and commitment to underserved youth." The U.S. Bank contribution will help the Council further develop and improve upon tracking metrics and aid work with scholars to enhance their exposure to and leadership potentials within the business community.

Thank you, U.S. Bank, for your support!

This week the Bay Area Council Economic Institute, with the help of McKinsey & Co., released the seventh biannual Bay Area Economic Profile Report, Recession and Recovery: An Economic Reset. The report found that in the face of the worst economic downturn in decades, many of the perennial challenges that pose a threat to the economic success of the Bay Area have come into stark relief.  "The dramatic losses in jobs, trade and home values of the last two years are now matched by visible quality drops in education, infrastructure and the ability of our public institutions to make critical decisions.  This seriously impacts the region's economy, requiring renewed and decisive action."   

The report benchmarks our region's economy against other cities and regions around the world.  It also identifies our shortcomings and calls for a wide range of actions to address them.  Click here to download the full report (1.2 MB). Read coverage on it here: San Francisco Chronicle; San Jose Mercury News; San Francisco Examiner; Silicon Valley/San Jose Business Journal; San Francisco Business Times; KCBS; KGO TV.

Here is a recent interview I did for Business Week on the Council's new Cyber Security initiative, which is already grabbing attention and being taken seriously by both policy leaders and the media. The Committee has begun to the address Cyber Security challenges facing business communities around the world and will be delivering its recommendations to the highest levels of policy makers in Washington D.C. and Sacramento.

Today, the Bay Area Council announced that its Executive Committee voted to continue the business organization’s support of Assembly Bill 32 (AB 32), the Global Warming Solutions Act.  AB 32 was signed into law by Governor Schwarzenegger in 2006.  The Executive Committee of the Bay Area Council took action to solidify their support in response to a possible initiative on the November 2010 ballot postponing implementation of AB 32. 

The Bay Area Council’s Executive Committee also agreed with the positions laid out by Governor Schwarzenegger in a March 24, 2010 letter to the California Air Resources Board, which clarified how AB 32 can be implemented in a way that would allow California businesses to remain competitive. 

“The notion of repealing AB 32 presents a false choice to the people of California,” said Jim Wunderman, President and CEO of the Bay Area Council.  “We don’t have to choose between a strong economy and combating climate change.  These two critically important goals can mutually reinforce each other.  In fact, postponing AB 32 would send a signal to the world that California is hot and cold on climate change – a view that will crimp investment in our future economy.”

In 2006, the Bay Area Council was the first business group in California to support AB 32 and successfully negotiated language that made the bill business friendly.  The Bay Area Council recognized then the threat of climate change to the economy and quality of life, and also saw an opportunity for California to become a global leader in clean technology and related fields.

“The threats that existed in 2006, when AB 32 was first adopted, still exist today,” said Wunderman. “But so do the opportunities.”

According to Governor Schwarzenegger’s letter to the Air Resources Board, California has already seen a positive economic impact due to AB 32.  Indeed, between 2006 and 2008, 10,000 new green businesses were created, producing more than 125,000 jobs – more than any other state in the country. 

With campaign spending records falling every day it seems, June 2010 will be a primary unlike any other in recent times.  Alongside the high profile primaries for Senate and Governor there will be a number of initiatives that are equally important to the future of California.   The Bay Area Council Executive Committee recently took positions on the following key June ballot measures as well as one November measure:

Prop 14: Open Primary Initiative - Support
This measure would provide for a “voter-nominated primary election” for each state elective office and congressional office in California, in which a voter may vote at the primary election for any candidate without regard to the political party preference disclosed by the candidate or the voter. The 2 candidates receiving the 2 highest vote totals would then compete for the office at the ensuing general election.

Prop 15: California Fair Elections Initiative - Oppose
This initiative would authorize eligible candidates for Secretary of State to obtain public campaign funds. This would be financed by a fee administered to registered lobbyists and those who employ registered lobbyists.

Prop 16: Vote Requirement for Local Electricity Providers - Support
Requires local governments to obtain the approval of two-thirds of the voters before providing electricity to new customers or expanding such service to new territories if any public funds or bonds are involved. Requires same two-thirds vote to provide electricity through a community choice program if any public funds or bonds are involved.

Prop 17: Auto Insurance Reform Initiative - Support
Changes current law to permit insurance companies to offer a discount to drivers who have continuously maintained their auto insurance coverage. Establishes that lapses in coverage due to nonpayment of premiums may prevent a driver from qualifying for the discount.

November Ballot Measure: Safe Clean Reliable Drinking Water Supply Bond – Support
$11.14 Billion general obligation bond to fund a range of statewide water infrastructure projects. Funds will be divided among Sacramento River Delta and various watershed preservation projects, water quality monitoring, water storage and conveyance, and water conservation/recycling projects.

As published in Bay Area News Group papers

For a region whose residents lead the nation in their support for public transit, you'd be forgiven for expecting the Bay Area to have an outstanding transit system. But anyone who rides transit here knows the reality: fares are high and rising, buses and trains are old and dirty, and services are often slow and infrequent.

If you're dependent on transit, you're going to spend a huge part of each day waiting for and riding the bus, especially if you live in an outlying area or work late or very early hours.

If you're an occasional transit user? Good luck figuring how to get from point A to point B via some combination of the more than two dozen proudly independent transit operators in the Bay Area.

Life isn't much easier for those who work at transit agencies either. With huge budget shortfalls today and as far as the eye can see, demoralizing service cuts and layoffs are the order of the day.

What is at the bottom of this mess? If you've followed the latest news, you might think that the state is to blame for taking money away from transit.

It's true that the state has taken some transit funds, but the problems originated long ago and go much deeper. Sadly, most of the problems are self-inflicted. It has become clear that we are spending so much time and energy arguing among ourselves and pointing fingers that we are failing to work on the progress that we all want.

The latest example pitted two worthy goals — building a new BART rail link to Oakland International Airport, and backfilling cuts to local bus service — against each other. Any objective analysis would conclude that the Bay Area needs both, but what we're likely to get is neither.

We've managed to convince ourselves that we can only get our own particular transit concern addressed if we make sure that someone else doesn't. This is not a recipe for success.

The Bay Area spends more than $2 billion each year on public transit, including hefty chunks of money from bridge tolls, sales taxes and parcel taxes. Bay Area residents, however, choose transit for only 6 percent of their trips. It's not just about insufficient funding — Bay Area transit funding has increased by 91 percent over the past decade, but ridership only increased by 7 percent.

This isn't just a minor problem. The Bay Area is entering a new phase of its growth in which we will become increasingly reliant upon an effective, affordable public transit system. That's because we've essentially tapped out the growth pattern of the past several decades in which our region sprawled into the hinterland, while loading more cars onto already congested highways.

Over the next several decades, new homes and jobs will need to come back to city centers and other zones that can support effective and convenient public transit. This is no longer a terribly controversial idea in the Bay Area — the Bay Area Council believes it, environmental and social equity groups believe it, Bay Area public officials believe it, and state law encourages it — but it does require a public transit system that works. We don't have such a system, and we're not going to get one by continuing in the direction that we're heading.

The Bay Area can have world-class public transit, however, and I think that we must. It's going to require more money for transit, and significant reform toward how public transit agencies use that money. The bad news is that no one is going to do this for us. The good news is that the Bay Area can largely do it on its own. We can identify what's not working with transit, what we really want our transit system to look like, and how to best deliver those transit services that residents want. If we do it right, I am confident that Bay Area residents would support a modest regional tax increase that would make the system a reality.

All of us who consider ourselves public transit leaders need to take a step back and remind ourselves of the values and vision that we all share. We can agree to work together to achieve that vision, and we can commit to individual compromise in place of collective combat.

There's only one way to make this happen, and that is together. Let's put aside our disagreements, focus on our fundamental agreements and see how far we can get. We just might achieve something great and necessary for the Bay Area.

The Bay Area Council Economic Institute (BACEI) and the regional Joint Policy Committee (JPC) are pleased to announce their partnership with the San Francisco Foundation, which has awarded a $50,000 grant to support Climate Bay Area (CBA), the new regional climate organization run by BACEI and the JPC. The grant will enable Climate Bay Area to develop an innovative strategic initiative on climate protection, bringing together high-level Bay Area leaders from diverse interest groups. The grant will also help CBA recruit major businesses to partner with government and non-profit organizations on specific regional climate projects.

Why Climate Bay Area?

Hundreds of Bay Area businesses, government agencies and non-profits are now actively engaged in climate protection and adaptation work. These organizations are developing programs and advocating for action, but for the most part are not connected to each other and therefore lack both scale and impact. The next major step—the implementation of strategies that will significantly reduce emissions and prepare our cities for climate impacts—is yet to come and will require engagement from many directions, including business. To facilitate progress toward meeting AB 32 targets, in a manner that is consistent with both climate and economic goals, Climate Bay Area (CBA) will serve as a resource for the region, bringing together public, private and non-profit stakeholders to address relevant issues. By providing critical support and networking, CBA will help the Bay Area climate movement to move forward at the speed and scale required, and help make the Bay Area a state and national model for climate change management..

History/Organization

Climate Bay Area was formed in July, 2009, by the Joint Policy Committee—the Metropolitan Transportation Commission, Bay Area Air Quality Management District, Association of Bay Area Governments, and the Bay Conservation and Development Commission. The JPC consists of five elected officials from each of the four regional agencies. The Bay Area Council Economic Institute (BACEI) is the JPC's partner in developing and managing Climate Bay Area. The Institute's Board of Trustees is composed of business leaders appointed by the Bay Area Council, elected officials appointed by ABAG, the executive directors of the four JPC agencies, and leaders from universities and labor.

Climate Bay Area is led by a co-chair from each organization—the JPC’s Climate Consultant, Bruce Riordan and BACEI’s President, Sean Randolph. Both organizations will contribute resources to support CBA with the JPC Climate Consultant leading day-to-day operations. The Climate Bay Area Working Group, staff-level experts representing all sectors, will play a key role through in-person and web meetings.

Contact:

For more information, please contact Sean Randolph, President of the Economic Institute, at 415-946-8722 or email sean@bayareacouncil.org.

Today Governor Schwarzenegger signed SB 71 (Padilla, D-Pacoima) into law, creating a sales tax exemption for the purchase of green tech manufacturing equipment in California.

In order to compete in the world economy, and to stay true to our goal to be the most innovative place in the world, we must continue to pass legislation like this, which in addition to creating jobs, spurs investment in green tech.

This bill was part of the Governor's larger job creation package - we congratulate the Governor and the Legislature for their hard work and success on this bill.

The U.S. Department of Education announced the list of 16 finalists for the first round of its Race to the Top funds, a list that did not include California. The announcement came as a great disappointment, especially after the Legislature performed “legislative backflips” in the lead up to the January application deadline, passing education reform laws to make the state more competitive for as much as $700 million in federal funds.

States that made the first cut include New York, Florida, Massachusetts and Colorado, as well as the District of Columbia. States were chosen based on willingness to improve failing schools using tools such as a data collection, tougher testing standards and teacher training. It is expected that less than half a dozen of the finalists will go on to receive funding in the first round.

With another round of funding coming up in the summer, California will have a second shot at the Race to the Top money. In order to have a chance this next time, the state will have to demonstrate its ability to improve failing schools through additional reforms even before receiving funding.  U.S. Department of Education Secretary Arne Duncan hopes this strategy to lure states into the Race to the Top will result in improved education systems even in states that do not receive federal funds.

Missing out on the first round of grant funding is disappointing but is not a closed door.  We now have more time, and the challenge, to bring additional reforms to the table for round two.  The Bay Area Council looks forward to working with all stakeholders, and our lawmakers in Sacramento, to find the path that will allow us to usher in some much-needed federal dollars and a new era for education in California.

The Bay Area Council today announced that for the first time in 20 months, more Bay Area companies are planning to increase the size of their workforce than are planning layoffs, signaling a potential job market rebound, according to results of its quarterly Business Confidence Survey.

The responses of the 498 CEO’s and top executives in the nine Bay Area counties surveyed between January 27 and February 18, 2010, show that overall, 20 percent plan to increase their workforce within the next six months while 17 percent expect layoffs, and 59 percent predict no change.  These results are in stark contrast to a year ago, when the Survey revealed that only 10 percent of companies were planning to hire, while 42 percent expected layoffs. The last time the Survey recorded a positive job market trend was in June, 2008. 

Learn more:

Press Release
Results
Charts

Job Creation Measure held up in Senate Environmental Quality Committee
Monday, March 1, 2010
posted by: Matt Regan

SBX8 42 a bipartisan bill co-authored by Senator Lou Correa (D Santa Ana) and Senator Dave Cogdill (R Modesto) would help spur California’s floundering economy and put thousands of people to work this year instead of two or three years from now.

In a nutshell, this bill would protect from needless litigation, a select number of construction and infrastructure projects, that have completed the rigorous California Environmental Quality Act and been given a clean bill of health. 

The CEQA lawsuit is the tool of choice of any disgruntled opponent seeking to halt any new development.  The California Environmental Quality Act requires that projects of sufficient scope produce an Environmental Impact Report outlining the potential impacts of their projects and what they plan to do to mitigate those impacts.  The EIR process also involves a lot of subjectivity and is therefore ripe for litigation.  Anyone with an axe to grind can stall vital new projects for years.

Senators Correa and Hollingsworth are not seeking to bypass or CEQA, quite the contrary, their bill requires that any protected project must first complete the CEQA process and meet with the approval of the appropriate governing or permit issuing body.  They are simply asking that once this arduous and expensive process has been completed, and the project in question vetted in public and approved, that construction can start rather than waiting another couple of years for the trial lawyers to repeat the whole process again in a court room.

Business and labor were united this week in Sacramento in support of the bill, yet it remains hung up in Committee, probably destined to die there.  I wish I could report that our arguments fell on deaf ears, but the truly sad part of this story is that only two members of the Committee in question were actually present in the chamber when Senator Correa presented his bill.

Opponents of the bill rolled out the same tired arguments that we see any time CEQA  reform is discussed; “it’s a slippery slope” “it’s a camel’s nose” “they’ll be strip mining Yosemite Valley next” and the sorriest of them all, “why do we have to sacrifice our environment for short term economic gains?” 
 
This bill is very clear and limited in scope and would do nothing other than kick start environmentally sound, CEQA approved, projects in 2010 instead of 2012 or 2013. 

We will continue to advocate for this legislation and for other bills that will help put Californians back to work today.

This week the last chunk of transportation stimulus funds were awarded when U.S. Department of Transportation announced $1.5 billion in TIGER (Transportation Investment Generating Economic Recovery) grant awards for over 50 high-priority transportation projects across the country.  More than $57 billion of projects were submitted to DOT; with only $1.5 billion available for the TIGER program, competition was fierce.  When awards were announced this week, two important Bay Area projects came out in the winner's circle:

• $46 million for the Doyle Drive safety reconstruction project
• $30 million for Port of Oakland's "Green Trade Corridor" emission reduction project (including electric shore-power for cargo vessels, and a new barge system that connects to the Ports of Stockton and Sacramento)

Congress created the TIGER grant program in the American Recovery and Reinvestment Act of 2009 (ARRA) to fund transportation projects that "have a significant impact on the Nation, a metropolitan area, or region."  In a departure from typical practice, the TIGER program has no formula component; instead, the Secretary of Transportation was given the full authority to pick the best projects from across the nation.  A similar model was applied to stimulus funds for high speed rail, perhaps signifying that the Obama Administration intends to play a much more hands-on role in guiding federal transportation investments than in the past.

The day after the President released his first budget, a Bay Area Council delegation was at the White House and on Capitol Hill pressing for the quick adoption and implementation of proposals that will deliver new jobs to the state and region.

The timing was perfect for the Council's second public policy focused trip to Washington, with a "Transportation, Infrastructure and Jobs" emphasis. Click here to see the complete Policy Book, which details Council recommendations for the next Surface Transportation Act, FAA Reauthorization Act, and continued enactment of the American Recovery and Reinvestment Act (ARRA). In summary, the Council believes that "...federal transportation policy must narrow its focus to a small number of areas of greatest national significance," that will deliver the maximum benefit to the vasty majority of Americans who live and work in our country's major metropolitan areas.

Along with Council President & CEO Jim Wunderman, the group was led by Transportation and Land Use Committee Chair Michael Covarrubias, Government Relations Committee Chair Andrew Giacomini, Transportation Funding Subcommittee Chair Stuart Sunshine, and BAC Executive Committee member Andy Ball. Public sector leaders Steve Heminger, Executive Director of the Metropolitan Transportation Committee, and Omar Benjamin, Executive Director of the Port of Oakland, were also part of the group.

Meetings on "the Hill" were held with Speaker Nancy Pelosi, Congresswomen Anna Eshoo and Zoe Lofgren, newly elected Congressman John Garamendi (our sole representative on the House Transportation and Infrastructure Committee), Oregon Congressman Peter DeFazio (senior member of the Transportation and Infrastructure Committee and Chair of the Subcommittee on Highways and Transit), and Senator Barbara Boxer.

After a substantive meeting with senior officials at the Department of Transportation, it was over to the White House to see Derek Douglas and Adolfo Carrion, the Special Assistant to the President for Urban Policy and Director of the White House Office of Urban Affairs, respectively. Derek and Adolfo challenged the BAC to help them devise and drive a national strategy that is precise enough to be effective, with the flexibility to be adapted and successful at the local level. We will be following up on this, with the involvement of the BAC members who went to DC, and others.

After Copenhagen: Climate Action Goes Local
Monday, February 1, 2010
posted by: Sean Randolph

After Copenhagen: Climate Action Goes Local
Developing economies are some of the world leaders in clean technology

By Sean Randolph, President, Bay Area Council Economic Institute
Published on YaleGlobal

The failure in Copenhagen to agree on either fixed targets for greenhouse gas emissions or a rigorous system for monitoring was a setback in the global warming battle. Controversy over the extent of human responsibility didn’t help, but resistance by large emerging economies was the stumbling block. But this shouldn’t deter communities and businesses from pressing on with the actions needed to reduce CO2 emissions.

The fact is, progress is being made in both industrial and emerging economies including China and India. Businesses are embracing new technologies and practices. And sub-national governments are increasingly stepping up to the plate with or without national government support. Global negotiations will remain important, but for the near term at least, the real action will shift to the national and sub-national levels. That’s not such a bad thing, since this is where technologies actually get adopted and where behavioral changes occur.

Read More

Opinion Editorial by Jim Wunderman
Published in the Contra Costa Times, Oakland Tribune, San Mateo County Times & Tri-Valley Herald

AS 2009 closes, the opinion of most Californians is "good riddance." The year ends with record unemployment figures of 12.5 percent, 25 percent higher than the national average. Other large states with diverse economies like New York and Texas have unemployment rates below average. The year also closes with another record budget deficit looming and more cuts to education and other vital services on the way.

Economists predict a slow recovery for the nation's economy in 2010, but what about California? Will we lead the nation out of this recession as we have done so many times in the past?

I believe we can. California still has the best and brightest workforce in the world, we still lead the world in innovation, venture capital investment and new technologies. If any place can turn this economy around, it is California.

Unfortunately, it is also true to say that if anywhere in the world, despite its embarrassment of riches, can make things worse, it is California.

A recent national survey of CEOs ranked California the worst state in the nation to do business. The nonpartisan Tax Foundation ranks California 48th in the Business Tax Climate index. A 2009 report commissioned by the governor, titled "Cost of State Regulations on California Small Businesses" totals the cost of regulation to the state at almost half a trillion dollars. This cost amounts to 3.8 million lost jobs, one-tenth the state's population.

Businesses in California are overtaxed, overregulated and underappreciated, which is why so many are moving to other states. If we are to emerge from our current fiscal mess, a mess that is costing us our position as an economic leader in the country and the world, we must make policy changes to encourage new investment and job creation in California.

Before we step forward, let's start by looking back and undoing shortsighted policy decisions that have badly damaged California's economy. This is my wish list for California's businesses in 2010.

In 1999, California scrapped the 40-hour federal standard for payment of overtime, and instead forces employers to pay overtime to employees once they have exceeded eight hours in any given day, even if they work less than 40 hours a week. This law, combined with California's incredibly rigid lunch-hour rule, makes California noncompetitive. Employers and employees need more flexibility and less mandates from Sacramento. We need to repeal AB 60, the eight hour day law, and AB 1711, the mandatory lunch law.

It is impossible to total the California Environmental Quality Act's (CEQA) cost to business, because it is so pervasive. One thing is certain: It is a massive anchor on California's economy. The U.S. already has stringent environmental protections in the National Environmental Protection Act; California has set the bar much higher in CEQA and forces our businesses through lengthy and costly delays. We need to reform CEQA to speed up the review process and give more certainty to business while maintaining our environmental protections.

California has the highest sales tax in the nation and is one of just four states in the nation that does not allow a sales tax exemption for the purchase of machinery used in manufacturing and telecommunications. This puts California at a huge competitive disadvantage and cost us thousands of jobs since the exemption sunsetted in 2004. We need to address our overall taxation structure and reinstate the 6 percent Manufacturer Investment Credit that helped pull California out of the last recession.

We can protect our environment, workers and businesses and prosper again, but we must act decisively and act fast.

2010 started with a bang for Repair California – the coalition that runs the Constitutional Convention effort – when the Los Angeles Times moved their support of the Convention from concept to reality in this editorial entitled A smart convention plan.  On the same day, the San Francisco Chronicle ran an extensive Opinion Editorial, Californians have the opportunity to fix state, by John Grubb, former Council EVP and current Campaign Director for Repair California.

In late December, the Attorney General issued Title and Summary for the Constitutional Convention ballot measures.  This development moves the campaign into its next phase: Statewide signature gathering.  Repair California has until April to collect approximately 1.4 million signatures.  The Bay Area Council continues to support the cause – and was recently given a nod for our efforts in addressing the major concerns of our state when Jim Wunderman was named “California’s Person of the Year” by California politics observer Joe Matthews.

You can access the Title and Summary for the measures below:

Prop 1:  “Allows voters to place question of calling a constitutional convention on the ballot."
Title & Summary

Prop 2:  “Calls a limited convention to propose changes to state constitution."
Title & Summary

Stay tuned for more Constitutional Convention updates.