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  • Archive for May 15th, 2015

    May 15


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    The Governor has released his revised $115 billion 2015-16 state budget – what is known in the Capitol parlance as the “May Revise.”

    “I don’t want to get caught in the jaws of the persistent fiscal instability of the state government of California,” the Governor said of the budget that many are praising for its fiscal restraint.

    A growing economy has fueled more funds available to the state than was expected in when the original budget was released in January.  $6.7 Billion to be exact.  Most of that unexpected revenue will have to be spent on priorities enshrined by the voters into the state constitution – about $5.5 billion will go to K-12 schools and community colleges; $633 million to the “Rainy Day Reserve;” and about the same amount to pay down existing debt.

    Overall, this budget will use $2 billion for budget related debt and puts away another $3.5 billion in a rainy day reserve.  Additionally, the budget direct more funding to deal with drought related issues (see below).

    Rex Hime, President and CEO of the California Business Properties Association remarked state, “The commercial real estate industry applauds the Governor for proposing a responsible budget that resists the calls to direct these funds to ongoing programs.”

    However, nothing creates conflict in the Capitol like some extra capital, as several Democrat legislators called for more funds to be spent on a variety of social programs.

    Senate Republican Leader Bob Huff (R-Diamond Bar) released a statement noting that, “When faced with higher revenues, holding the line on spending is a good thing.”

    Click here to see Senator Huff’s take on the budget.

    As the weather in Sacramento heats up, so will the debates over spending priorities.

    Click here to read full budget summary of the “May Revision – 2015-16.”

    May 15


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    From the budget:  The State of California has experienced four consecutive years of below‑average rain and snow, and is currently facing severe drought conditions in all 58 counties.

    The most recent surveys recorded the statewide average snowpack, which is the source for one‑third of the state’s water, at just 2 percent of the normal average.

    Water supplies at the state’s largest reservoirs, as well as groundwater aquifers, are significantly depleted. As a result, drinking water supplies are at risk in some communities, agricultural areas face increased unemployment, dry conditions create higher risks for wildfires, and important environmental habitats have already been degraded.

    The state’s emergency drought response is strategically guided by accelerating several of the key actions in the California Water Action Plan that will provide long‑term benefits for the state.

    Since the Governor first declared a state of emergency in January 2014, the Administration has worked with the Legislature to appropriate approximately $1.9 billion to assist drought‑impacted communities and provide additional resources for critical water infrastructure projects, including:

    • $50 million Cap and Trade funds for the DWR to support state and local water use efficiency projects that save energy and reduce greenhouse gas emissions.

    • $47.3 million General Fund for the Department of Social Services to provide food assistance to those impacted by the drought.

    • $35 million General Fund and special funds for the Water Board to provide grants for emergency drinking water projects

    Click here to read the full May Revise budget proposal for water.

    May 15


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    The California Building Standards Commission will meet on May 29th to adopt emergency building standards to significantly reduce the amount of potable water that can be used for outside landscaping irrigation purposes.

    These emergency building standards will apply to new residential and commercial building construction for which the initial permit application is submitted to the local building department on or after June 1, 2015.   This emergency action was prompted by the Governor’s recent Executive Order on the drought emergency and subsequent rules issued by the State Water Resources Control Board.

    Among other things, the emergency building standards will require the calculation of a water budget for the site using a modified version of the Department of Water Resources’ Model Water Efficient Landscape Ordinance (MWELO).  This is the water budget calculation tool that has been required in most local jurisdictions for the past five years.

    The modified tool results in a 20%-25% reduction in landscape water consumption.

    Although we are still seeking advice and comment from our membership on detail, we are working with the Governor and BSC and have let it be known that our industry is generally supportive of these changes.

    A copy of the emergency standards can be found by Clicking here.

    May 15


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    An industry supported bill that incentivizes disability access and education passed two Senate policy committees this week.

    SB 251 (Roth; D-Riverside) is a balanced approach between preserving the civil rights of those who are disabled to ensure access to all public accommodations, and limiting the number of frivolous lawsuits threatened or filed against businesses that do not improve accessibility.

    The bill passed the Senate Judiciary Committee and the Senate Governance and Finance Committee this week with unanimous support.

    SB 251 seeks to incentivize businesses to proactively take steps to become accessible by providing them with 90 days from receiving a Certified Access Specialist (CASp) report to resolve any violations identified without being subject to statutory penalties or litigation costs. This proposal will assist businesses that are trying to ensure they are compliant with the law from being subject to frivolous claims or litigation.

    SB 251 also provides a limited time period for businesses to resolve minor, technical construction-related standards that do not actually impede access to the public accommodation. Specifically, SB 251 provides businesses with 15 days from the service of the summons and complaint to resolve any alleged violation regarding signage, parking lot striping, and truncated domes.

    This limited period will provide a business owner the opportunity to devote financial resources to resolving these minor issues before being subjected to statutory penalties and attorney fees.

    Click here to read an analysis of the bill.

    The bill has been named by the California Chamber of Commerce as a “Job Creator” bill and we are part of a large coalition working to move this bill forward.

    May 15


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    Two bills in the California State Legislature addressing the issue of AEDs (defibrillators) in commercial buildings passed the Senate Judiciary Committee this week and will head to the Senate Floor.

    SB 658 Hill – Addresses onerous training requirements.  We testified in support of this bill which is intended to reform requirements that need to be met in order to for a property owner to receive limited liability protections under the law.  Our members have let us know this is a priority as it is the main reason that AEDs are not more widespread.

    This bill passed committee on a bi-partisan 7-0 vote with all Democrats and Republicans supporting the measure.

    SB 287 Hueso – Mandates installations in New Buildings with 200+ Occupancy.  We testified in opposition to this bill for a number of reasons, but most importantly we do not believe the state should mandate these devices when it knows that property owners currently cannot comply with many of the issues addressed in AB 658.

    This bill passed committee with the minimum number of votes needed, 4-2.  Both Republicans on the committee opposed the measure and one Democrat chose not to vote.

    We will continue to work with both authors and hope that we can work out some of the technical issues related to building occupancy related to SB 287.


    May 15


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    Speaker Toni Atkins (D-San Diego) effort to find a way for more affordable housing on a statewide basis passed its first committee this week.  AB 1335 creates the “Building Homes  and Jobs Act,” which seeks to create permanent funding for affordable housing through a new real estate fee and increasing tax credits to spur new building.

    As an industry we want to play a positive role in helping solve issues related to affordable housing in this state, and are amenable to several ideas that have been discussed related to AB 1335.  However, we have some concerns about the way the bill is envisioned and have made several suggestions on way we think it can be improved.  We look forward to working with the Speaker on this issue this year, and hope we can be part of a positive solution that works for all parties.

    Identifying statewide permanent funding sources to backfill the loss of redevelopment is a critical issue, especially because many local jurisdictions are actively pursuing fee and tax hikes on our industry locally to pay for affordable housing.  We hope a fair and comprehensive solution can be found.

    May 15


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    AB 2 (Alejo; D-Salinas) which would create a new tool for economic development and affordable housing passed the Assembly Floor on a 63-13 vote.  The bill would provide local authorities the ability to create a “Community Revitalization Investment Authority (CRIA)” which would be empowered to invest property tax increment of and use other available funding to create development and infrastructure opportunities.  Although this bill does not fill the massive void left when Redevelopment Agencies were abolished, we are supporting it because local agencies need additional authority to create economic opportunity.

    Click here to read an analysis of the bill.

    May 15


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    Our friends at ICSC report from Washington D.C.:  This week the House of Representatives passed H.R. 1732, “Regulatory Integrity Protection Act of 2015,” by a vote of 261-155.

    As you may recall, this bill will force the Environmental Protection Agency to withdraw its proposed rule to redefine “Waters of the U.S.” (WOTUS). Further, the legislation mandates that the Agency re-propose the rule after the EPA and Army Corps of Engineers conduct formal consultations with stakeholders — which should have been done during the original rulemaking process.

    This is great news and we thank the many groups that are working to help educate policymakers on issue.


    May 15


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    We are founding member of a coalition of business and taxpayer organizations that has banded together to provide education and information about the problems related with fundamentally changing Proposition 13.

    The group is named Californians to Stop Higher Property Taxes.  On behalf of individuals and companies that will be impacted by higher property taxes, the coalition provides a website with lots of good resources for news and information, including academic studies that show the negative impacts a split roll would have on California’s economy.

    Click here to visit the CSHPT website.