MOORLACH UPDATE — SB 88 — June 19, 2015

A special Senate Floor Session was called for this morning, lasting more than five hours, to approve the new "junior" budget and thirteen trailer bills. This followed a five-and-one-half hours Budget Committee meeting yesterday afternoon.

The good news is that the Governor did not budge very much from his original May revise budget. The bad news is that the budget does not address unfunded liabilities as aggressively as it should (see MOORLACH UPDATE — The Budget Act — June 16, 2015 June 16, 2015 John Moorlach and MOORLACH UPDATE — Civilian Oversight — June 15, 2015 June 15, 2015 John Moorlach). Consequently, I voted to oppose.

I serve on the Budget Committee and, since I’m a victim of Trailer Bill abuse, thanks to SB 89 in 2011 (see MOORLACH CAMPAIGN UPDATE — 34th Senate District — August 31, 2014 August 31, 2014 John Moorlach), I voiced my concerns and opposition Thursday afternoon and it was captured by the San Francisco Chronicle in the first piece below.

I’m just off of the Senate Floor and the San Francisco Chronicle covers it already in the second piece below. I vented my agitation one more time, stating that trailer bills are an inappropriate strategy for the Governor to use. If they are not related to the budget, then knock it off. SB 88 is opposed by just about everyone in the municipal arena and it is an amazing policy over reach. SB 88 was provided to the Budget Committee yesterday morning, just a few hours before our meeting. This "middle of the night" nonsense has to stop. So I reminded my colleagues that this is not rule by fiat and that this is not a monarchy (see MOORLACH UPDATE — The Budget Act — June 16, 2015 June 16, 2015 John Moorlach).

The Daily Pilot provides the good news that the Joint Legislative Audit Committee’s agenda had the Great Park audit of the audit dropped (see MOORLACH UPDATE — Butt Out — June 13, 2015 June 13, 2015 John Moorlach). Thank goodness for small victories.

Have a wonderful Father’s Day weekend!

File:San Francisco Chronicle logo.svg

Budget ready for vote, with officials’ pet projects slipped in

By Melody Gutierrez

With a state budget deal announced this week, details are emerging of last-minute policies tucked into the spending plan that will bypass the typical public scrutiny.

Lawmakers will vote Friday on the $115.4 billion general-fund budget deal and accompanying trailer bills for the 2015-16 year, which include wide-ranging new spending for lawmakers’ pet projects and several policy changes that have nothing to do with the state’s finances.

“There are decisions in these bills that have never been heard, and many that were publicly rejected, only to be put back in when no one was looking,” Sen. Jeff Stone, R-Temecula (Riverside County), said Thursday during a Senate hearing to review the budget bills.

For example, one non-budgetary provision would extend a deadline for an environmental review required for the planned Golden State Warriors arena in San Francisco, and another would grant the state new authority to force troubled water districts to consolidate with larger, better-funded ones.

A coalition of statewide local government organizations, including the Association of California Water Agencies and League of California Cities, opposes the water agency proposal, which they said should go through a normal public policy review instead of a fast-tracked budget bill. Several lawmakers agreed.

“That needs a lot more discussion than it will get being brought in this late,” said Assemblywoman Melissa Melendez, R-Lake Elsinore (Riverside County).

In all, there are 13 trailer bills accompanying the state budget this year, and some of the provisions in the legislation enact anticipated, much-discussed proposals, such as the state earned income tax credit, or various parts of the budget deal announced Tuesday by legislative leaders and Gov. Jerry Brown.

Others were a surprise, even to the lawmakers voting on the measures.

The surprise provisions turn up as add-ons in trailer bills that commonly accompany the main budget bill. The entire budget package of legislation often includes more than a dozen bills that are voted on separately.

Lawmakers said they had just hours to review a drought trailer bill sought by the governor that included an exemption under the California Environmental Quality Act, or CEQA, for local governments that want to place a moratorium on new wells.

The governor’s office included language in a trailer bill that would erase $8 million the state agreed to pay counties for land purchased for wildlife conservation and would make it optional in future years for the state to pay for such purchases. The administration said it intends to pay for future purchases and included $644,000 in the 2015-16 budget for land conservation purchases. But the state wants to wipe the slate clean on past purchases and ensure flexibility on whether it must make future payments when the funds may not exist.

Sen. Lois Wolk, D-Davis, called the proposal a “real poke in the eye.”

“I think it’s shortsighted,” Wolk said to administration officials at a budget hearing Thursday.

Sen. John Moorlach, R-Costa Mesa (Orange County), challenged Sen. Mark Leno, D-San Francisco, about whether the Warriors arena environmental review extension should be part of the budget bill.

“What does this have to do with the budget?” Moorlach asked. “Why not do this as a regular bill?”

Leno said he requested the environmental review extension for the Warriors when it appeared that the team would not be able to meet a deadline to get the environmental review finalized by Jan. 1, 2016.

The extension, which also applies to a building in Hollywood, allows for large projects already deemed environmental leaders to be streamlined under CEQA. Under the trailer bill, the Warriors would now have until Jan. 1, 2017, to finalize the environmental review for the arena to qualify for the streamlined process.

Leno said that after the Warriors listened to the community and decided not to proceed with the original waterfront site, finding a new location at Mission Bay and building support has delayed the team’s ability to meet the deadline.

“If we didn’t extend the date, they would have been punished for doing the very thing I want to encourage projects to do — get public support,” Leno said.

Leno said including the extension in the budget bills will allow it take effect July 1 if signed by the governor, versus the start of the new year.

Melody Gutierrez is a San Francisco Chronicle staff writer. E-mail: mgutierrez. Twitter: @MelodyGutierrez

California Legislature sends budget to Jerry Brown

By Melody Gutierrez

The California Legislature gave final approval Friday to a $115.4 billion general fund state budget that now heads to Gov. Jerry Brown, who helped negotiate the revised spending plan and has given it his support.

The record-high budget for the fiscal year beginning July 1 received a handful of Republican votes as it passed the Senate 30-9 and Assembly 53-26.

The Legislature officially passed the state budget Monday, but did so with a party-line vote on a $117.5 billion spending plan that did not have Brown’s support. Instead of waiting for Brown’s veto pen, the governor and legislative leaders announced Tuesday they had reached a deal with $2 billion less in spending. The deal included some of the additional spending for child care and health care that Democratic lawmakers’ sought.

Lawmakers passed the amended bill Friday that reflected the budget deal as well as trailer bills, including controversial drought-related measures that give the state the authority to force small, troubled water districts to consolidate with larger, better-funded ones and an exemption under the California Environmental Quality Act, or CEQA, for water recycling projects and for local governments that want to place a moratorium on new wells.

Many lawmakers criticized Brown for offering the language for the drought bill at the last minute.

“It’s a major policy change that has no business of being in the budget process,” said Sen. John Moorlach, R-Costa Mesa (Orange County). “This is a cram-down.”

The state budget creates an Earned Income Tax Credit for the poor, sets aside $40 million for 170,000 children who are undocumented immigrants and whose families are low income to receive Medi-Cal benefits and $265 million to create 13,800 preschool and child care slots along with a rate increase for providers.

Under the budget, the state’s rainy-day fund will have a $3.5 billion balance by the end of the year, while setting aside $1.1 billion for an operating reserve and $1.9 billion to pay down debts and liabilities, including money borrowed from public schools during the recession.

Public schools will receive $3,000 more per student in 2015-16 compared with four years earlier as K-12 schools take in $60 billion in funding for the upcoming fiscal year that begins July 1.

“This budget strikes a responsible balance between strengthening our long-term fiscal foundation and investing in the economy of today and the workforce of tomorrow,” Senate President Pro Tem Kevin de León, D-Los Angeles, said in a statement. “This budget focuses on bookend investments at the start and end of a California kid’s educational career, by adding childcare and preschool slots for working families and increasing access to higher education.”

Democratic lawmakers had hoped to restore Medi-Cal rates, further increase subsidized preschools and repeal a law that denies additional state aid to children born to parents who were already on welfare. Brown said there wasn’t enough money for all of the discretionary spending Democratic lawmakers sought.

Sen. Mark Leno, D-San Francisco, said there is still much to be proud of in the budget.

“The nature of compromise is that no one gets everything that he or she wants,” said Leno, who chairs the Senate’s budget committee. Melody Gutierrez is a mgutierrez. Twitter: @MelodyGutierrez

Daily Pilot

Second request for Great Park Audit investigation is dropped

By Matt Morrison

A push to have the audit of the Orange County Great Park examined in the Legislature hit a second wall Wednesday when Assemblywoman Lorena Gonzalez (D-San Diego) abruptly withdrew her request before a meeting of the Joint Legislative Audit Committee in Sacramento.

Gonzalez had proposed an investigation at the joint meeting in April at the urging of construction design firm Gafcon, a Great Park subcontractor headquartered in her district. At that time, the item was denied approval, despite a 9-3 overall vote in favor, because the request did not have the required balance of at least four yes votes by both the state Assembly and Senate members of the committee.

In January 2013, the Irvine City Council approved conducting the audit of the Great Park work at an original budget of $240,000. A subcommittee of Irvine council members Christina Shea and Jeffrey Lalloway was charged with overseeing the audit. The final report was presented in March after more than two years and at a cost in excess of $1.2 million.

The audit report concluded that the construction of the park was rife with mismanagement and budgetary irresponsibility, noting that more than $200 million had been spent on the project between 2005 and 2012. Findings left the door open for legal action to recover money paid to contractors based on potential professional negligence, false claims or conflicts of interest.

Gafcon, Newport Beach public relations firm Forde & Mollrich and former Irvine Mayor Larry Agran, who oversaw the Great Park project for five of the seven years in question, are all central figures in the report. After 28 years as a City Council member, including three terms as mayor, Agran was voted out of office last November.

Gonzalez argued in April that the audit process may have been drawn out for election purposes and that Gafcon’s reputation and business suffered significantly as a result. At the same hearing, Gafcon principal Yehudi Gaffen testified that his company "lost millions" and "did not win one job in 2014 because of this so-called audit."

Exactly why Gonzalez dropped her second request at the June 17 committee meeting remains unclear. Attempts to reach the assemblywoman were unsuccessful, and a representative from her legislative office said only that Gonzalez will "continue to monitor the situation" and may still file a request for an investigation at a future joint meeting.

Legislators opposed to the "audit of the audit" have speculated that the item did not have enough support to pass, prompting Gonzalez to withdraw the request.

"All I know is she withdrew the item, and I’m gratified that she has," said Assemblyman Don Wagner (R-Irvine). "I thank Lorena for withdrawing the request."

Representing a delegation of Republican legislators from Orange County, Wagner wrote a letter to Joint Legislative Audit Committee Chairman Mike Gibson (D-Carson) urging that it deny the audit request.

The letter was co-signed by state Sens. Patricia Bates (R-Laguna Niguel), Bob Huff (R-San Dimas), John Moorlach (R-Costa Mesa) and Janet Nguyen (R-Garden Grove), along with assembly members Travis Allen (R-Huntington Beach), William Brough (R-Dana Point), Ling Ling Chang (R-Diamond Bar), Matthew Harper (R-Huntington Beach ) and Young Kim (R-Fullerton).

Gafcon spokesman Paul Najar said the lobbying effort against the investigation is troubling. Najar said defensive efforts of Irvine Mayor Steven Choi and special counsel Anthony Taylor at the April joint committee meeting prevent transparency of the audit process.

An official statement issued by Gafcon said the audit is "riddled with falsehoods" and concludes: "We are perplexed as to why the City Council is spending so much additional public money to oppose a review by the non-partisan state auditor if they have nothing to hide."

This e-mail has been sent by California State Senator John M. W. Moorlach, 37th District.

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