Connected L.A. Money Stories

Joel Fox
Editor of Fox & Hounds and President of the Small Business Action Committee

Los Angeles’ major daily newspapers this weekend each had separate stories that reflected big money in Los Angeles and, in a way, the two stories are connected.

The Los Angeles Times reported than many Silicon Valley entrepreneurs were spending big bucks for Los Angeles area real estate. We’re talking on the high end about $70 million for a custom mansion in Beverly Hills. One realtor said the techies are buying second, third or fourth homes on the West Side of Los Angeles and the beach communities in the $2 to $5 million range.

The Los Angeles Daily News reported on the top salaries of employees of the Los Angeles Unified School District. The article focused on the dismissed Superintendent John Deasy and his $440,000 paycheck. Of note, number five on the list was an elementary teacher who took in $235,000, much of it in unexplained “back pay.” The top ten annual salaries were at $200,000 and above.

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LAO: Consider Phasing Out Retiree Health Care


Gov. Brown’s plan to curb the long-ignored debt for state worker retiree health care, now much larger than their unfunded pension debt, may look familiar. It’s similar to the standard state and local government pension reform.

Workers contribute more, most going from zero to 3 percent of pay, and new hires not protected by vested rights get lower benefits, working five years longer to get health coverage capped at what they received on the job.

Last week, the nonpartisan Legislative Analyst’s Office, noting that most of the plan bypasses the Legislature, recommended that lawmakers hold hearings on state worker retiree health care, going back to square one, 1961, when the benefit began.

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When Even The Dominant Culture Shouldn’t Prevail

Loren Kaye
President of the California Foundation for Commerce and Education

An honest-to-God civics lesson is playing out in the State Capitol. Members of the Assembly should take a moment to refresh their understanding of the Bill of Rights.

During the debate over the Constitution, James Madison wrote to Thomas Jefferson:

Wherever the real power in a Government lies, there is the danger of oppression. In our Governments the real power lies in the majority of the Community, and the invasion of private rights is chiefly to be apprehended, not from acts of Government contrary to the sense of its constituents, but from acts in which the Government is the mere instrument of the major number of the constituents.

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NFL Football Players and California’s Income Tax Rate

Joel Fox
Editor of Fox & Hounds and President of the Small Business Action Committee

Last month, prompted by the efforts to build a Los Angeles football stadium and lure an NFL team, I commented on how Proposition 13’s tax vote provisions were influential in the moves and countermoves on the stadium debate over public funding. But, the state’s sky-high income tax also is a factor when individual players consider accepting free agent contracts with California teams.

When All-Pro tackle Ndamukong Suh decided to leave the Detroit Lions he considered an offer from the Oakland Raiders. However, he ended up accepting an offer from the Miami Dolphins for $60 million.

A commentary on the sports website ESPN made the following point:

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Let the People See What the EPA is Trying to Hide

Congressman Kevin McCarthy
Majority Leader, United States Congress

In the Central Valley, exhaust and pollution from big cities like San Francisco and Los Angeles gets blown in and trapped because of our topography. As a result, our air is notoriously worse than other parts of the country. Of course, we want to do whatever we humanly can to clean the air up, and we are.

But despite our progress, the EPA wants more. In fact, the EPA says science demands more. But there’s a big question here: ‘What science?’ 

Right now, the EPA is trying to impose harmful regulations based on scientific studies that no one can check—not the public, not independent scientists, not even the United States Congress. It’s called ‘secret science,’ and it’s wrong. If the EPA or most any agency is going to propose a rule, especially rules that add great costs to our economy and infringe on people’s private property, the people have every right to know why.

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Black Caucus Brings Its Clout To CA School Funding Fight

Chris Reed
San Diego Union Tribune editorial writer and former host of KOGO Radio’s “Top Story” weeknight news talk show

The Local Control Funding Formula, enacted in 2013, is supposed to make sure more education dollars are used in ways that specifically help struggling students. Gov. Jerry Brown pushed for the education funding change because he said it was crucial to making millions of mostly minority students into productive citizens helping the California economy. Reformers saw the law as “a historic investment in high-need students.”

However, the Legislative Analyst’s Office surveyed 50 school districts around the state, including the 11 largest, and warned in a January report that not one had proper safeguards to prevent diversion of funds. In Los Angeles Unified, among other districts, the local teachers’ union last summer pointed specifically to new, incoming LCFF dollars as a kitty to tap for pay raises.

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Big UC Changes May Come from Private ‘Committee of Two’ Meetings

Joel Fox
Editor of Fox & Hounds and President of the Small Business Action Committee

Ironically, in the midst of Sunshine Week, designed to create more open government and freedom of information, the “Committee of Two” considering the financial situation of the UC system – Governor Jerry Brown and UC President Janet Napolitano – are not forthcoming in revealing details about their negotiations. Despite protests to the contrary, this may be a necessary thing.

Yesterday at the UC Regents meeting in San Francisco, both Brown and Napolitano did a two-step around whatever progress is being made in their talks about the proposed tuition increase. Napolitano and the Regents supported tuition increases if the university system did not get more money from the state. Brown refused to be bullied.

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Sunshine Week: Ushering Public Records into the 21st Century

Assemblyman Jay Obernolte
Jay Obernolte represents the 33rd District in the State Assembly. Jay was elected in November 2014 and currently serves as the Assistant Republican Leader on Innovation and the New Economy.

Monday marked the beginning of the 10th Annual Sunshine Week, a week dedicated to promoting the importance of civic transparency and the value of unrestricted access to public information. Founded by the American Society of News Editors, Sunshine Week underscores the simple idea that open government is good government.

Unfortunately, the State of California is still a long way from making government open and accessible to the people it serves. In an effort to get our state back on track, the Assembly Republican Caucus recently proposed a package of bills aimed at restoring the public’s trust in state government.

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The Only Thing Worse Than Scandals Are California’s Attempts to Stop Them

Joe Mathews
Connecting California Columnist and Editor, Zócalo Public Square, Fellow at the Center for Social Cohesion at Arizona State University and co-author of California Crackup: How Reform Broke the Golden State and How We Can Fix It (UC Press, 2010)

Did we win in Bell?

There is no greater symbol of local California corruption than Bell, a city of 35,000 people, 2 ½  square miles, and many gas stations in southeast L.A. County. For years, Bell City Manager Robert Rizzo and his minions exploited every dark corner of California’s convoluted systems of local governance and finance. They paid each other scandalously high salaries (Rizzo’s package of wages and benefits was worth $1.5 million annually), used the city’s redevelopment agency like a piggybank, borrowed improperly, squirreled away money in illegal retirement accounts, purchased property off the books, approved illegal fees and taxes, and used a sham charter election to exempt themselves from state laws. 

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Drought Watch: Priorities for Cities and Farms

Jeffrey Mount and Ellen Hanak
Mount and Hanak are Senior Fellows at the Public Policy Institute of California

A spate of recent news articles have reinforced what most Californians already know: the state is locked in a grim drought, with unusually warm temperatures and near-record low snowpack. Since this is the fourth consecutive dry year, reserves are low and water scarcity will be acute in some farming regions and watersheds.

In our new report, Policy Priorities for Managing Drought, we highlight four areas that need reform to reduce the economic, social, and environmental harm from drought in California: 1) improving water use information; 2) setting clear goals and priorities for public health and the environment; 3) promoting water conservation and more resilient water supplies; and 4) strengthening environmental management.

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