Paying for single-payer: Put up or move on

Loren Kaye
President of the California Foundation for Commerce and Education

Since the best feature of the Healthy California Act is that all health care will be free, it seems churlish to suggest that someone must pay for something.

Sadly, even after asserting more than $70 billion in new savings from efficiencies that highly motivated private providers and government regulators have not achieved, and after assuming that federal authorities will hand over about $150 billion in program funding and tax subsidies for use by state health care officials, the academics hired by program proponents find that revenues still fall short by $106 billion.

That’s in year one. Before health care inflation kicks in and utilization of free health care services metastasizes. An analysis of the measure by the author’s own staff found that, “Given all the factors that would make utilization management difficult, a 10% utilization increase is likely a conservative assumption.” That translates into tens of billions annually in higher health care costs.

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California Budget Lives in the Matrix

John Seiler
Former Editorial Writer at the Orange County Register

Gov. Jerry Brown and the Democratic Legislature continue taking the Blue Pill over the state’s economy and the budget they’re finalizing this week. It’s for the fiscal 2017-18 budget, which begins on July 1. They’re living in the Matrix, not the Real World.

Although Brown has warned, weakly, of impending budget difficulties, his budget still spends way too much should the state economy soften. There are plenteous indications that’s happening, largely because of the anti-business taxes and regulations this state has imposed on its people, instead of pro-business policies such as those in Texas, Florida and other forward-looking states.

Perhaps everything will be fine. Maybe the national Trump Boom will carry along even California. Maybe California will boom boom boom. But it’s right to be prudent. That way, if the state ends up enjoying extra money in its budget, it could pad the Rainy Day fund, or maybe start paying down its $1 trillion in unfunded liabilities.

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State Must Reform BOE but Preserve Key Taxpayer Protections

Vice president of government affairs for Printing Industries of California

The California State Board of Equalization (BOE) needs to be reformed. The five-member, elected constitutional body is responsible for administration of sales tax, business taxes and fees, state-assessed property tax, and hearing income tax cases. A recent audit has uncovered administrative and operational missteps, which have been well documented in the press. I applaud the effort to examine the BOE, and believe this is the key to improving managerial oversight of the agency.

The initial response from the Governor Jerry Brown and the Legislature was appropriate – checks must be put in place to prevent these same problems from recurring. But there is a difference of opinion as to what needs fixing. Some reformers, like Assembly Revenue and Taxation Committee Chair Sebastian Ridley-Thomas, are rightly focused on addressing the problems raised in the audit. Others, however, have gone beyond the scope of the audit, proposing to gut the agency altogether, including its adjudicatory and regulatory functions. This would be a huge mistake, and it is no surprise that advocates of such measures haven’t recognized the importance of a democratically elected tax board as a check against bureaucratic dominance and tax auditors running amok.

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Proposals for ADA Litigation Reform

Chris Micheli
Attorney and Lobbyist at the Sacramento government relations firm of Aprea & Micheli, Inc.

Despite several statutory changes enacted over the past several years, including one by the former Democratic Senate Leader, there continues to be numerous filings of state lawsuits for construction-related violations of the Americans with Disabilities Act (ADA). There has to be significant reforms to limit these lawsuits to only the legitimate ADA violations that actually limit or threaten to limit access. Unfortunately, it is the activities of attorneys, and a very small group of them, which need to be reined in by state law.

While disability rights advocates make the fair point that the federal ADA statute has been in effect for the past quarter century and businesses must comply with the law’s provisions, there is also a legitimate problem of filing lawsuits in California state courts that only result in financial pay-outs to a select group of attorneys without actual ADA access being furthered.

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California’s Democratic Lawmakers Shouldn’t Fear Primary Threats Over Single-Payer

Steven Maviglio
Principal of Forza Communications, a Sacramento-based public affairs/campaign firm

Backers of the single-payer health care legislation, Senate Bill 562, have made it clear in trying to bully state lawmakers that if they don’t support their bill, they’ll run candidates against them in next June’s primaries.

Assembly Democrats should call their bluff. Because the threat of knocking off incumbent lawmakers with single-payer as a litmus test, as some have suggested, is all bark, no bite and without foundation in fact.

Politically savvy lawmakers, such as Governor Jerry Brown and Assembly Speaker Anthony Rendon, already have been smart enough to question the bluster of single-payer advocates. As an article that appeared yesterday headlined “Bernie Sander’s Army is Not the Democratic Base” adeptly notes (and reiterated by 538’s Nate Silver,” when it comes to winning elections (including Top Two primaries ), single-payer is not an issue driving voters nor reliable Democratic voters.

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Stacking the Deck on Elections

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

A  budget bill has been introduced that would lengthen the time to qualify recall elections. One might say this bill came out of the blue—blue California, that is. Changing election rules to benefit their positions is becoming a habit with Democrats in the legislature.

The presumed object of the bill, SB 96, is to forestall the recall election of Sen. Josh Newman, hoping to combine the election with the regularly scheduled June 2018 primary when a larger turnout of Democratic voters is expected. Under current rules, if the recall qualifies, a special election must be called. Special elections have smaller voter turnouts and Newman is expected to be in greater jeopardy.

This would not be the first time in the last few years that Democrats in the legislature teamed up with Gov. Jerry Brown to play with the election rules to secure a more favorable election outcome.

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Brown Does the Lord’s Work on Prop 56

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)

In California, the act of trying to make an inflexible ballot initiative a little more flexible is the Lord’s work.

Which brings me to the fight over Prop 56.

When you voted on that measure, you might have thought you were casting a ballot merely over the raising of taxes on tobacco. But, no. As with so many other ballot measures, you were making budget decisions, as if you were a state lawmaker.

The measure laid out specific places for the money to go, mostly to health programs favored by those interest groups responsible for getting the measure on the ballot and supporting the measure. (Don’t be shocked. “Pay to play” isn’t a corruption when it comes to ballot initiatives. “Pay to play” is the dominant business model).

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Board of Equalization Overhaul Hurts Taxpayers

Teresa Casazza
President of the California Taxpayers’ Association

Public trust in government is eroded every time non-budgetary policy changes are rammed through the Legislature under the cover of the state budget process. Proposed budget trailer bills (AB 102 and SB 86) amount to untested structural changes that will hinder the Board of Equalization’s ability to continue collecting one-third of the state’s annual revenue.

Recent revelations of problems at the BOE demand focused solutions that are thoroughly vetted to make sure they solve the problems without creating new ones.

Unfortunately, many of the suggested BOE ‘reforms’ are nothing but thinly disguised attacks on taxpayers’ rights, including the right to meet with elected officials and the right to appeal taxes without the expense of going to court.

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Why State Tax Deduction Will Stand

Charles Crumpley
Editor and Publisher of the San Fernando Valley Business Journal

Articles and accounts about the possibility of federal tax reform typically conclude with this: Californians appear poised to get thumped. More than anyone else in the country.

Indeed, if you’ve read such accounts about looming tax changes, you probably sighed and sorrowfully agreed that it seems logical, inevitable, close to absolute certitude that Californians, and particularly wealthier ones, are going to pony up much more moola to the Feds on April 15.

But wait. I’m here to give you hope. Maybe you need not worry about your ballooning future federal tax bill. That’s because it’s hard to see how the California-hurting tax reform can pass. More about that in a minute.

First, the background: As you know, taxes you pay to the state of California get deducted from your federal taxes. If you pay, say, $10,000 in state taxes, that $10,000 isn’t taxed by the Internal Revenue Service. It has been that way since the get-go. Otherwise, it would be double taxation.

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Gas Tax Poll Sends a Tremor Through the Political Landscape

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

A tremor ran through the 2018 California elections with the release of the UC Berkeley Institute of Governmental Studies poll that shows widespread disdain for the recently passed gas tax and vehicle fees–even before collection of the tax begins in November. The gas tax issue could sway California elections from the governor’s race on down, especially if an initiative effort to repeal the measure makes the ballot.

There is a long way to go before November 2018. Other issues could come to dominate that election. A test of the gas tax could come earlier if the recall effort against Democratic senator Josh Newman (D-Fullerton) qualifies for the ballot.

But the potential of a gas tax revolt is offering interesting shadows in my cracked crystal ball as we look ahead to 2018.

The IGS poll found California registered voters opposed the gas tax plan 58% to 35%. Those strongly opposing the plan stood at a solid 39%. Strong supporters were only at 14%.

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