Bay Area Council Blog

2.1.10

After Copenhagen: Climate Action Goes Local

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

1.2.10

Must act decisively and fast to save California

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.

1.2.10

Constitutional Convention effort starts 2010 with a bang

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.

DC Cherry Blossum2

Must act decisively and fast to save California

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.

12.11.09

Critical Bay Area Transportation Projects Moving Ahead

By Michael Cunningham

Oakland Airport Connector Clears Final Hurdle
After decades of debate, the Oakland Airport Connector – a train system connecting BART to the Oakland Airport – cleared its final hurdle on Thursday when the BART Board of Directors voted to award $440 million in contracts to build and operate this unique public private partnership. The Connector – a landmark stimulus project receiving $70 million in federal funds – provides a critical missing link in the Bay Area’s transportation infrastructure system, taking cars off the road and creating 2,500 to 5,000 jobs starting in 2010 to construct the project. Jim Wunderman gave testimony at the hearing and the Bay Area Council is happy to see decades of work on the project come to fruition.

BART to San Jose Project Gets Boost
The long fought, Council supported BART to San Jose extension just got a huge shot in the arm when the Federal Transit Administration recommended it for federal “New Starts” funding. Once that federal funding (as much as $900 million) is approved, Santa Clara County will finalize the environmental document and can begin to collect a new 1/8 percent sales tax that County voters recently approved. Groundbreaking won’t be far behind. The first segment of the project is actually under construction, with the Shimmick/Skanska consortium hard at work building a tunnel on the leg from Fremont to Warm Springs. Thanks to Carl Guardino and the Silicon Valley Leadership Group for driving this important project.

Caldecott Tunnel Construction to Begin Next Month
Relief is coming to motorists in one of the Bay Area’s worst highway chokepoints, with a contract awarded in November to construct the new fourth bore of the Caldecott Tunnel. Long recognized as a necessary transportation improvement, the project faced a frustrating setback in early 2009, when the state announced that it would not be able to provide the promised funds from Proposition 1B. Supporters refused to accept another delay, and a healthy contribution of federal stimulus funds put the project back on track. Opening of the new tunnel to traffic is expected in mid-2013.

There’s also hundreds of millions of dollars of federal stimulus dollars that are creating jobs and improving transportation through smaller projects throughout the Bay Area. In all, there’s almost $1 billion of federal stimulus dollars approved for Bay Area transportation projects. Even more is on the horizon, with the US Department of Transportation expected to announce projects that will be funded from two pots of stimulus funds (TIGER, and High Speed Rail) under its control. The Bay Area Council is working hard in Washington, DC to make sure that the Bay Area gets a healthy share of these funds to create jobs and improve mobility.

12.3.09

Business Confidence Creeps into Positive Territory

By Jim Wunderman

This week the Bay Area Council released its quarterly Business Confidence Survey showing that business confidence has crept into positive territory for the first time since the summer of 2007. The business confidence index – the number that distills the survey findings – registered at 53 out of 100. A reading over 50 signals a positive economic direction and below 50 is negative. The results indicate that we may have finally hit bottom and are looking up. Unfortunately, the new found optimism doesn’t seem to be translating into new jobs. Layoffs still outweigh hires in almost every corner of the Bay Area, the Survey shows. Overall, 23 percent of respondents expect to see their workforce decrease over the next six months, while 18 percent expect an increase and 56 percent expect no change.

Business Confidence Press Release
Jobs Chart | Confidence Index | Data

11.23.09

Berkeley City Council Gets On Board Ferry

By George Broder

The Berkeley City Council adopted a resolution at a recent meeting to go on record in support of a planned terminal at the Berkeley Marina. The Water Emergency Transportation Authority (WETA) is well into the environmental evaluation and permitting process, and official support from the City of Berkeley will help to smooth the remainder of the process.

WETA recently broke ground on construction of a new terminal in South San Francisco; the Berkeley terminal will be the first new terminal on the eastern shore of the Bay. Both terminals will provide not only new commute and recreation transportation but will also add critical transportation system redundancy and flexibility that will be available when bridges and highways are unexpectedly closed (and if you thought that the recent unplanned closure of the Bay Bridge was inconvenient, just wait until a 1906-scale earthquake hits).

The Council thanks Leamon Abrams, WETA’s new Community Relations Manager, for reaching out for our support. We look forward to working closely with Leamon – and Nina Rannells, WETA’s new Executive Director – to secure the funding and approvals needed to build out a true region wide ferry system.

11.20.09

Institute Report Shows Strong Ties with India

By Sean Randolph

This week the Bay Area Council Economic Institute released a new report, “Global Reach: Emerging Ties Between the Bay Area and India,” which assesses the unique ties linking the world’s innovation capital with the fastest growing major economy after China.

Once perceived primarily as a site for call centers and for low-cost off shoring, India has rapidly scaled the economic ladder to provide increasingly sophisticated services that are embedding its companies and workers into the fabric of the global economy. It is also developing dynamic markets that are attracting growing investment by Bay Area venture capital, technology and consumer-oriented companies.

The report is being released at two events – one today in Silicon Valley and one in San Francisco on Monday. You can download the Executive Summary here – or visit this webpage to download the full report. The Bay Area Council plans to build stronger ties with our counterparts in India and will keep you informed of our progress.

11.13.09

Meeting Discusses Business Case for Healthcare Reform

By Linda Galliher

Public option? Individual mandate? Universal coverage? The Bay Area Council, in partnership with the Committee for Economic Development, brought together the Bay Area business community to discuss the various components of the national health care debate.

Diving into the details, a panel of business leaders – Lloyd Dean, Catholic Healthcare West, Lenny Mendonca, McKinsey & Co., Greg Adams, Kaiser, and Wade Rose, Catholic Healthcare West – took pointed questions from Lynn Jimenez of KGO’s Morning News. This was a special meeting of the Council’s Healthcare Committee – and the first meeting with Greg Adams as the Committee Chair. We welcome Greg and look forward to his leadership on this important issue.

Also featured at the meeting was Ken Shachmut who gave a presentation on Safeway’s nationally recognized, innovative approach to health care – which is partially based on rewarding healthy behaviors. According to their research, 70% of healthcare costs are driven by behavior. They encourage prevention and wellness by linking healthy behaviors to financial incentives. You can download Ken’s presentation by clicking here. Thank you to all the members participated in this meeting– and if you are interested in getting involved contact Linda Galliher.

11.6.09

Persistence, Persuasion Pay Off with NOL

By George Broder

This week Congress passed – and this morning President Obama signed – a $24 billion bill to help the unemployed and support the housing market – with a Net Operating Loss (NOL) provision included as part of the deal – a major part of the Council’s 2009 legislative agenda.

The bill extends unemployment benefits that were due to expire for an additional 14-20 weeks. It also renews an $8,000 tax credit for first-time home buyers, while also expanding it to cover many other home purchases – another priority BAC members advocated for while in D.C. last month. The NOL provision allows businesses that had operating losses in 2008 and 2009 to seek refunds for taxes paid on profits over the past five years – extending it from two years.

NOL may not roll of the tongue, or come up often in conversation, but its more than just an accounting term – it’s about jobs and economic survival. An enlightened NOL tax policy allows businesses to weather tough times, maintain their payrolls and avoid layoffs.

A delegation of Bay Area Council members met with Congressman Richard Neal (D – Massachusetts), leader of the NOL fight in Congress, on our May trip to Washington D.C. – and again last month – to offer their support and expertise on the issue. In addition, it was a key issue while meeting with other members of Congress to support the extension. The Bay Area Council’s Urban Development Working Group has also been engaged on the issue and coordinated broader outreach to Congress by the Bay Area business community. The Bay Area Council is happy to have played a role in such a huge win for business.