Bay Area Council Blog: Community Engagement Archive

caltrainhsr

High Speed Rail Decision a Big Win For California, the Bay Area and the Bay Area Council

California and the Bay Area took a gigantic leap forward with the state Senate’s approval on July 6 of funding to begin construction on the initial phase of the nation’s first high speed rail system. The Bay Area Council had worked furiously in the months and weeks leading up to the vote to urge the Legislature’s support of high speed rail and the early investment it promises to electrify and modernize Caltrain, which was among our lead priorities. The Assembly approved high speed rail on July 5. As part of its advocacy push, the Council traveled to Sacramento to meet with key legislators to urge their support. We authored several opinion-editorial pieces that appeared in regional newspapers. We assembled a coalition of major employers that signed letters to the Legislature in support of high speed rail’s early investment in Caltrain. And, along with Rep. Anna Eshoo, we released an economic study showing that the early investment by high speed rail in Caltrain electrification would create almost 9,600 jobs and generate $2.5 billion in economic activity. The final push culminated several years of intensive advocacy and policy work by the Council in which we assisted and supported the development of the blended approach that high speed rail authorities adopted for having their trains share tracks with regional commuter rail lines like Caltrain and the agreement for bringing early high speed rail investment to Caltrain. The Council also advocated for the state ballot measure that voters approved in 2008 to provide almost $10 billion in bond funding for high speed rail.

sacoffice

Sacramento Here We Come

Anyone familiar with how decisions get made in Sacramento knows how important it is to have a physical presence in the state capital. That’s why the Bay Area Council is excited to announce it will be opening an office just a stone’s throw from the capitol building. Having a physical presence in Sacramento will help us stay on top of the latest developments involving some of our lead policy priorities, including reforming the California Environmental Quality Act, advocating for high speed rail and early investment to modernize Caltrain and winning reforms to public pensions – the latter an issue on which we’re partnering with the Silicon Valley Leadership Group to produce results. Much of our healthcare policy work also runs through Sacramento. The new office will also provide a great platform for our members to hold meetings. An exact move-in date hasn’t been set, so stay tuned for more information about our grand opening event.

innovation

NEW STUDY ASSESSES THE BAY AREA’S POWERFUL INNOVATION SYSTEM AND THE CHALLENGES IT FACES

Stagnating federal investment in basic research, declining state funding for higher education and immigration policies that limit access to global talent are threatening to erode the Bay Area’s position as the world’s premier center for technology and innovation, according to an in-depth report released by the Bay Area Science and Innovation Consortium (BASIC).

The report examines the unique mix of ingredients that make up the region’s dynamic technology and innovation eco-system, and how they work together to foster cutting-edge research, birth new industries and launch new companies and products. The report finds that compromising any of these ingredients can have a damaging ripple effect on the overall system and its ability to generate future jobs and growth.

“We have a powerful system of world-leading research institutions, companies, investors, entrepreneurs and networks that make this region a global super-hub for innovation. We can’t assume, however, that the region will keep its leading role if it fails to address its challenges or invest in its core assets, ” said Sean Randolph, President and CEO of the Bay Area Council Economic Institute, which authored the report based on interviews with BASIC institutions and other leaders in the region’s business, scientific and educational communities. “Solving the serious challenges outlined in the report will take a concerted effort by leaders at all levels of business, government and academia.”

Download the full report: The Bay Area Innovation System

Among the most serious threats that the study identifies are:

  • Federal funding for basic research that leads to fundamental technological advances is stagnant, even as foreign governments are investing heavily in research and education.
  • Federal limits on visas and green cards discourage many of the world’s best and brightest students, scientists and entrepreneurs from coming to the U.S., or staying after earning their advanced degrees.
  • Dramatic declines in state and local funding for California public higher education, which supplies much of the region’s highly educated and well-trained workforce.

To address these issues, the report offers a series of specific recommendations for deepening collaboration between the public and private sectors, increasing funding for research and public higher education, and reforming immigration policy to allow better access to visas and green cards for highly educated immigrants.

While the study offers a compelling look at the challenges facing the region’s innovation and technology sector, it also highlights the region’s many strengths and advantages. The study details the Bay Area’s extraordinary strength in scientific research – with five world-leading research universities, five national laboratories, and a host of corporate and independent research laboratories. The economic impact of the scientific research generated by these facilities is amplified not just by their discoveries, but by the ecosystem of venture capital firms, angel investors, incubators, accelerators and formal and informal networks that surround them. The key to how this ecosystem works, and to its extraordinary technological and economic productivity, is the fluid way people and ideas circulate and interact, with few barriers to the creation of new ideas and value.

The ecosystem’s success is reflected in several metrics: the Bay Area generates more patents than anywhere in the country; it is home to more of the world’s top technology companies and to more young, fast-growing companies than anywhere in the country; and hosts more than half of the top clean-tech companies in the country, including seven out of 10 of the top social media companies in the world.

“In the Bay Area the whole is equal to more than the sum of its parts,” Randolph said. “The secret sauce is in how they interact. The result is a dynamic ecosystem where people, technologies and ideas are continuously combined to create new value. That’s hard to replicate anywhere else.”

At the same time, the region’s visible success masks troubling trends that impact the rich base of human capital and talent on which California’s innovation prowess is based.

“The Bay Area has a marvelous innovation machine where all the parts – universities, federal laboratories, technology and bio-medical companies, the investment community, are integrated and work together,” said Mark Bregman, Chair of BASIC. “The problem comes when you erode or damage one part of that system – like higher education, which can affect all the other parts. For the Bay Area to remain an innovation super-hub and the world’s leading marketplace for ideas, we need to understand the global innovation environment and how it’s changing, keep the doors open to the rest of the world, and continually reinvest in our assets.”

healthcarecosts

SUPREME COURT RULING RETURNS FOCUS TO CONTROLLING COSTS AND IMPROVING HEALTH

In a statement today on the U.S. Supreme Court ruling upholding the federal Affordable Care Act, Bay Area Council President Jim Wunderman said: “Today’s ruling by the U.S. Supreme Court frees us to focus on the state-based details of fixing our broken healthcare system The next step is to use the tools available at a state level to reduce costs for businesses and consumers, make the system more efficient, transparent and understandable, and improve the quality of care for everyone.”

“Fixing our broken healthcare system is an economic imperative,” Wunderman continued. “Our current healthcare costs put us at a distinct economic disadvantage with our global competitors that we can’t afford as we work to lift ourselves out of recession. The Bay Area Council is focused on achieving market-based solutions that will drive greater efficiencies in the delivery of health care, control costs for businesses and consumers, and improve the value we get from our healthcare system.”

Under the legal framework provided by the Affordable Care Act, the Bay Area Council has been at the forefront of ensuring that changes to our healthcare system are implemented in a way that works for California businesses.  Last year, the Council issued a Roadmap to a High Value Health System that laid out the key priorities for promoting quality and affordability and recently issued a separate study on The Economic Impact of the Affordable Care Act on California. The study concluded that implementing the federal legislation will create almost 100,000 jobs in California and boost economic activity by $4.4 billion.

“The Council is working to ensure that any fixes we make fairly spreads the burden of healthcare responsibility and costs across all those who have a stake in the system,” Wunderman said. “A healthcare system that shifts a disproportionate share of costs to businesses and employers is ultimately unfair and unsustainable and will irreparably harm our economy and our ability to compete globally.”

Through that lens, the Council has been deeply involved in developing California’s Health Benefit Exchange, a new marketplace authorized by the Affordable Care Act for private insurance that aims to make health coverage more affordable and accessible for all, and provide greater transparency for businesses and consumers to make informed choices about their healthcare purchases. “We need greater focus on controlling costs, increasing the value we get from our healthcare system, and improving public health,” said Micah Weinberg, senior policy advisor for the Bay Area Council. “If we’re not working to provide more value, make the system more efficient and transparent, we’re focused on the wrong things.”

BizConf

Spring Business Confidence Survey Signals Optimism About Economy, Caution About Hiring

The Bay Area Council today released its spring Business Confidence Survey, with employers signaling caution about hiring, expressing modest optimism for economic growth over the next six months and giving the regional economy much higher marks than the national economy.

After reaching its highest level ever during the winter quarter, when it appeared the economy might be picking up steam, the business confidence index – the number that distills the overall survey findings – slipped from 66 to 61 out of 100 in the spring survey. Still, the indicator continues to register a favorable outlook, where a reading over 50 signals positive economic times, while below 50 is negative.

“It’s economic whack a mole,” said Jim Wunderman, President and CEO of the Bay Area Council. “There were strong signals earlier this year that the economy might finally be turning a corner and getting ready for a sustained period of increasing growth, which likely explains the record-high confidence we saw in the first quarter. The Bay Area continues to outpace the nation in employment and economic growth, but the progress has been frustratingly slow and uneven. Executives are still signaling optimism that we’re moving in the right direction, which is good news, but the biggest challenge, both here and nationally, continues to be actual hiring. Our overall outlook is improving, but in most sectors it’s not translating into sustained employment growth.”

Download Business Confidence Survey Results and Charts

Attitudes among executives about the national economic picture could have implications for the Presidential race and how President Obama and presumptive Republican candidate Mitt Romney frame their positions to voters. Just 14 percent of those surveyed said they think the national economy will get worse over the next six months leading up to the election, while 38 percent said it will remain the same and 48 percent expect it to get better.

The responses of the 426 CEOs, top executives and economic development officials in the nine Bay Area counties surveyed between May 11 and June 5 show that more than twice as many executives (31 percent) plan to increase hiring over the next six months as plan to shrink their workforce (13 percent). The 31 percent of executives planning to hire is the third-highest level since the Great Recession took hold in 2008. Still, the overall outlook for hiring remains cautious, with 53 percent of executives saying they will stand pat over the next six months.

The construction and transportation industries, among the hardest hit by the economic downturn, got some welcome news in the survey, with 56 percent of executives in these industries saying they expect hiring to increase in the coming months and just 5 percent expecting a decrease. In the leisure and hospitality industry, which has shown some of the most consistent gains over the past few quarters, 41 percent of executives say hiring will continue to grow.

The biggest decline in hiring is expected in the government sector, where 44 percent of officials said their workforces will get smaller over the next six months. The information and high technology sectors, among of the biggest drivers of job growth in recent months, appear to be cooling off a bit, with 72 percent of executives expecting their workforce to remain the same over the next six months.

Despite the tepid outlook for hiring, 62 percent of those surveyed think Bay Area economic conditions are better than six months ago and 59 percent expect economic conditions will continue to improve over the next six months.

San Francisco claimed the title for best hiring outlook in the region, with 47 percent of executives in the city saying they expect to increase their workforce over the next six months. Consistent with the flat hiring expectations in the technology sector, just 4 percent of executives in Santa Clara County expect to shrink their workforce in the next six months – the lowest percentage among all counties. Employers in Contra Costa and Alameda counties continue to have the least favorable outlook for hiring in the near future and continuing the East Bay’s well-established position as a drag on the overall regional economy.

The region’s regulatory climate didn’t win plaudits from executives, with 51 percent saying that local government regulation is a concern for them and their business. Improving the business climate in California and the Bay Area is among the Bay Area Council’s lead policy priorities.

“At a local and regional level, we’ve got to be doing everything we can to make sure our employers succeed, that we’re not putting up barriers or making it difficult for them to invest, grow and create jobs here,” said Lenny Mendonca, Director at McKinsey & Company. We can’t change what’s happening at the national or global levels, but we can do more to ease the regulatory burdens that get in the way of employers generating revenue and creating jobs.”

klemm

Council Members Bring Their Agenda to New APEC Ambassador

Last year, the Bay Area Council was proud to partner with San Francisco Mayor Ed Lee to host the gathering of Asia Pacific Economic Cooperation (APEC) and U.S. Secretary of State Hilary Clinton’s Women and the Economy Summit. APEC is one of the United States’ most important economic partnerships, and covers 21 economies, including China, Japan, Russia, the Republic of Korea, Mexico, Vietnam and Australia. Along with top ministers from those countries, the summit included Secretary Clinton; U.S. Secretary of Transportation Ray LaHood; U.S. Secretary of Energy Steven Chu; U.S. Secretary of Health and Human Services Kathleen Sebelius; and U.S. EPA Administrator Lisa Jackson. We were proud to host new U.S. Ambassador for APEC Hans Klemm for a get together on June 14 with our members. The discussion delved into issues about global intellectual property, removing global supply chain choke points, facilitating travel and tourism, reducing tariffs on environmental goods and services, and women and the economy. We were especially honored to hear Ambassador Klemm tell us that San Francisco and the Bay Area Council set the global standard for hosting diplomatic gatherings. We thank Ambassador Klemm for the gracious compliments and thank Dean Fealk of Council member DLA Piper for hosting the meeting.

oaklandport

Great News for Port of Oakland, Regional Trade and Employment

One of the Council’s lead priorities got a big boost that will spur new jobs and support the region’s valuable trade industry. The Port of Oakland on June 19 was awarded a $15 million federal grant to improve rail access to and from the Port and expand the Port’s rail capacity, leading to faster and cleaner goods movement, while also providing vital rail access for the proposed Oakland Army Base development. The Council pushed this project with letters, testimony and strategic phone calls urging federal and local officials to give the green light. The project means the Oakland seaport can accommodate more goods by rail rather than by truck, resulting in less truck traffic, congestion, and emissions, while lowering costs for trade-dependent businesses, especially the Port’s vital agricultural export partners. Also on June 19, the Port won approval from the Oakland City Council to move ahead with a $1 billion project to transform the Oakland Army Base into a warehouse, trade and logistics center. The project would add nearly 5,000 jobs and increase the capacity of the port.

hetchdam

Group Seeking to Tear Down Hetch Hetchy Launches Petition Drive for November Ballot

The threat of losing the Hetch Hetchy clean water and power system that serves 2.5 million Bay Area residents and businesses took a dangerous step closer to reality with supporters launching a petition drive to qualify a measure for the November ballot in San Francisco. The Bay Area Council has been a strong opponent of past efforts to eliminate Hetch Hetchy and is working with Sen. Dianne Feinstein, San Francisco Mayor Ed Lee, our members and a diverse coalition of business and community leaders to fight back the current effort. But recent polling by EMC Research shows that proponents of tearing down Hetch Hetchy can win in November unless there is a well-funded campaign to inform voters about the true intent of the measure, which is positioned under the pleasant guise of increasing water conservation. What the measure doesn’t state is that San Francisco and the Bay Area are already among the most miserly water users in the state, and that removing Hetch Hetchy would cost more than $10 billion, dramatically increase the region’s vulnerability to water shortages and drought and do away with a major source of clean energy.  To participate in the Council’s effort to protect Hetch Hetchy, contact Policy Vice President Matt Regan at mregan@bayareacouncil.org.

bayferry

First New Commuter Ferry Route in 20 Years Ready to Set Sail

The San Francisco Bay Area Water Emergency Transportation Authority (WETA), whose formation the Bay Area Council supported, is preparing to launch new ferry service between the East Bay and South Francisco on June 4. The new service, operating under the name San Francisco Bay Ferry, will serve the burgeoning biotech industry and other businesses in South San Francisco. It represents a major step in the evolution of the WETA’s vision for increased water transit services to lessen the burden on our roadways. Even better, commuters ride free during the first week. For more information and schedules, visit SF Bay Ferry.

acareport

Affordable Care Act Creates Almost 100K Jobs, Boosts Economic Activity in California by $4.4 Billion

A new study by the Bay Area Council Economic Institute suggests that if the Supreme Court strikes down the Affordable Care Act, it may have a negative impact on the California economy.

The study, The Economic Impact of the Affordable Care Act on California. concludes that the federal health care law would create almost 100,000 new jobs across California and boost economic output by $4.4 billion. The biggest expected job gains occur in Southern California, with almost 58,000 new jobs, followed by the Sacramento Valley with almost 13,500 new jobs, the Bay Area with 7,600 jobs, San Diego County with almost 6,500 jobs and the remaining 10,000 jobs spread throughout other counties.

“In the debate over the federal health care law, this study shows there has been more heat than light when it comes to understanding economic and jobs impacts,” said Jon Haveman, study co-author and chief economist for the Bay Area Council Economic Institute, the research arm of the Bay Area Council. “By focusing on expanding health insurance coverage, making our health care system more efficient and making our workforce healthier, we can realize important employment and economic gains.”

Download the full report: The Economic Impact of the Affordable Care Act on California.

Driving the employment gains is an overall rise in economic activity stemming from increased spending on healthcare and medical services and the secondary benefits of that money flowing to other parts of the economy. That increased spending will boost overall economic activity in the state by $4.4 billion. Again, the biggest gains will be in Southern California, where net economic activity increases by $3 billion. Sacramento County is the next largest beneficiary of increased spending, with net economic output rising by almost $608 million.

Those figures take into account the dampening impact that provisions such as the employer mandate is expected to have on hiring and economic activity. The mandate, which is among the more hotly contested elements of the Affordable Care Act, requires large employers to provide their employees with health insurance or pay a fine. And yet, the study observes that the employer mandate is a “crucial tool” for the overall expansion of healthcare coverage that on net is a job creator in the state.

“The Bay Area Council’s new economic impact report shows that making the insurance market fairer and more inclusive is an economic boon to the state,” said Julian Canete, President & CEO of the California Hispanic Chambers of Commerce (CAHCC). “The report demonstrates how the federal health care law will help communities such as California’s Latino-owned businesses and workforce by enhancing economic and health conditions to strengthen California’s economy.”

By expanding health care coverage, the study found, the Affordable Care Act will also expand the overall labor force by better maintaining the health of the workforce and preventing workers from being sidelined because of health problems. Broader coverage will also reduce “job lock,” in which uncertainty about changing health insurance discourages workers from seeking better jobs.

“The Affordable Care Act provides an important framework for expanding health care coverage in a way that can boost employment, increase overall economic activity and make people healthier,” said Dr. Micah Weinberg, study co-author and Senior Policy Advisor for the Bay Area Council.

The study is careful to note that “the ultimate impact of health care reform, though–both in terms of its true economic implications and whether it achieves its substantive policy goals–depends heavily on implementation, which will require close partnership between the federal government, the states, and the private, charitable, and non-profit sectors.”

“The Bay Area Council is playing a leadership role in the business community in working closely with state officials and other key policy makers in implementing the Affordable Care Act in California, keeping the focus on reducing health care costs and improving public health. These are the things that will help improve California’s business climate and keep us competitive in the global marketplace,” said Jim Wunderman, President and CEO of the Bay Area Council.