MOORLACH UPDATE — CIRM and School District’s Group 5 — September 26, 2019

CIRM

It’s always a big compliment when you’re invited to submit an editorial on a subject for a longtime newspaper of stature in the state.  The San Diego Union-Tribune requested my thoughts on the possibility of the California Institute of Regenerative Medicine’s (CIRM) plans to put another bond measure on the 2020 ballot to replenish its slush fund.  It’s the first piece below.

CIRM recently announced intentions to encumber Californians with another $5.5 billion in debt, plus interest (see MOORLACH UPDATE — CIRM, Completing and Curriculum — August 15, 2019). Debt payments would be around $250 million to $350 million a year from the general fund.

I was one of the three individuals who signed the argument against Proposition 71, the ballot measure that established CIRM in 2004 with a $3 billion bond. This was the first statewide ballot measure I got involved with.  I felt that it would be a boondoggle, as most of the serious stem cell patents had already been filed by the University of Wisconsin and this newly established entity would have no oversight. Regretfully, my worst fears were realized and the San Francisco Chronicle did an excellent job of critiquing this poster child for ballot measure abuse last year (see  MOORLACH UPDATE — SB 1004 and CIRM — September 10, 2018).

California has enough debt.  The Golden State has the second-largest unrestricted net deficit and placed 42nd when compared on a per capita basis (see MOORLACH UPDATE — 2018 State Per Capita UNPs — August 22, 2019  and MOORLACH UPDATE — Hart, Handy and OPEBs — August 29, 2019, where I announce the slight adjustment to Illinois’ unrestricted net deficit due to its finally releasing its CAFR).

For another study on the 50 states, reflecting that my per capita metric is fairly reliable, see Truth in Accounting’s just released report at  https://www.truthinaccounting.org/news/detail/financial-state-of-the-states-2019.  Using a different methodology from mine, they come to a similar ranking, placing California 43rd.

Corona del Mar Chamber of Commerce

The Daily Pilot announces my upcoming October speaking engagement with the Corona del Mar Chamber of Commerce in the second piece below.

School District Ranking – Group 5 – #377 to #470  

Releasing Group 5 brings us to the halfway point.  It would be better if your school district were in the top half.  Orange County has two more districts that make it to this category, #466 – Los Alamitos Unified and #468 – Cypress Elementary.  For links to the first 4 groups, see MOORLACH UPDATE — Reducing Debt Transparency? — September 25, 2019. It’s the third piece below.

OPINION

Commentary: Why stem-cell research funding proposal is a waste of taxpayer money

Promises not kept, conflicts abound

By JOHN M. W. MOORLACH

https://www.sandiegouniontribune.com/opinion/story/2019-09-25/commentary-why-stem-cell-research-funding-proposal-is-a-waste-of-taxpayer-money

Like a spendthrift dependent, the California Institute for Regenerative Medicine (CIRM) is back and looking for more money. With its original Proposition 71 funds of $3 billion running out, beneficiaries of CIRM are looking to draw out another $5.5 billion in taxpayer-funded bonds for stem-cell research that after 15 years has produced close to no results.

In 2004, as Orange County’s treasurer-tax collector, I took a public stand against Proposition 71 as a waste of the taxpayers’ money. I believed then, as now, that it was an inurement subsidy on the backs of taxpayers. It was ballot measure abuse at its finest.

Also opposing Proposition 71 were taxpayer and good-government groups, as well as the California Nurses Association and the Green Party.

In 2019, we can look back at the record of the 2004 measure, which Hollywood actors sold to voters with unrealistic promises and pleas, and surmise the same results will be repeated but at a higher cost.

Why? First, the lack of promised outcomes. “The agency has since funded 55 clinical trials, but only one therapy … is likely to hit the market any time soon,” Nature reported in July.

In September 2018, the San Francisco Chronicle reviewed the agency’s nearly 1,000 grants, concluding there was no “predicted windfall.” Instead, most of the money went to “basic research, training programs and building new laboratories, not to clinical trials testing the kinds of potential cures and therapies the billions of dollars were supposed to deliver.”

Second is the lack of promised returns. The only royalty check for new discoveries was in March 2018 for $190,345.87.

Third is the excessive payouts to the measure’s promoters and beneficiaries due to no accountability of CIRM, expressly written into the measure, from either the Legislature or the governor’s office.

Former state Sen. Art Torres, although not a scientist, is vice-chair of the CIRM governing board, earning an annual paycheck of $225,000.

Financier Robert Klein, who initiated Proposition 71 and contributed $3 million to its campaign, was CIRM’s chairman from 2004 to 2011. In 2008, he was granted a “half-time” salary of $150,000 a year.

The Chronicle investigation found board members “abstained from voting on grants roughly 1,770 times since 2006 due to reported financial conflicts.”

Researcher Lloyd Billingsley reported that “91 percent of CIRM funding went to institutions with representatives on the CIRM board.”

Federal income tax law prohibits private inurement, i.e., receiving excessive benefits from a nonprofit.

Fourth is the massive amount of tax dollars invested in a “dry hole.” Not only was the $3 billion for the research a bust, but taxpayers will be paying interest on the principal until 2039. California Treasurer Fiona Ma’s office told me the cost of the interest on the $2.59 billion of principal already spent will be $836.6 million. Interest rates lower than anticipated in 2004 kept that below the original $3 billion estimate.

That’s money that could have gone for housing for the homeless, paying off pension liabilities or having more teachers in schools.

Fifth, the private sector is the proper venue for risk-takers trying to make a return on potential stem cell cures.

In 2020, it would be an added folly to pass $5.5 billion in new bonds, plus interest, to keep CIRM open. Yet that’s what Klein and others are considering putting on the ballot next year.

This time, expect more stories making emotional appeals. As I expressed in 2004, this measure is a self-serving stunt and a corporate subsidy on the backs of taxpayers.

If asked to sign a petition, I strongly urge Californians to refuse to back this initiative. Fool us once.

Moorlach, R-Costa Mesa, represents the 37th District in the California Legislature.

Moorlach to speak in Corona del Mar

https://www.latimes.com/socal/daily-pilot/news/story/2019-09-25/political-landscape-rouda-to-speak-in-newport-a-week-after-announcing-support-for-trump-impeachment

State Sen. John Moorlach (R-Costa Mesa) will deliver a State of the State address at a Good Morning Corona del Mar meeting from 7:30 to 9 a.m. Oct. 10 at the Bahia Corinthian Yacht Club, 1601 Bayside Drive.

The free public event, presented by the Corona del Mar Chamber of Commerce, will include complimentary refreshments and updates from representatives of local legislative offices.

377 Chualar Union 2,228 ($655) 165 -212
378 Borrego Springs Unified 4,172 ($656) 473 95
379 Perris Elementary 51,990 ($660) 386 7
380 Loomis Union Elementary 23,325 ($661) 470 90
381 Coast Unified 10,322 ($662) 631 250
382 San Jose Unified 273,335 ($662) 466 84
383 Central Union High 60,573 ($663) 287 -96
384 Pope Valley Union Elementary 793 ($665) 411 27
385 Whittier Union High 225,755 ($665) 258 -127
386 Sequoia Union High 261,419 ($666) 331 -55
387 Rosemead Elementary 28,126 ($667) 365 -22
388 Escondido Union High 177,581 ($667) 360 -28
389 Forestville Union Elementary 6,834 ($669) 455 66
390 Amador County Unified 38,626 ($669) 414 24
391 Alta Loma Elementary 57,654 ($670) 325 -66
392 Two Rock Union 1,745 ($671) 486 94
393 Oak Valley Union Elementary 1,459 ($674) 320 -73
394 Yosemite Unified 24,893 ($674) 428 34
395 Cambrian 32,850 ($679) 241 -154
396 Gateway Unified 29,936 ($681) 355 -41
397 South Bay Union 81,726 ($684) 193 -204
398 Newhall 76,378 ($693) 359 -39
399 Moraga Elementary 17,700 ($693) 546 147
400 Cotati-Rohnert Park Unified 54,453 ($693) 422 22
401 Los Gatos-Saratoga Joint Union High 57,689 ($695) 457 56
402 Franklin-McKinley Elementary 97,698 ($696) 447 45
403 Luther Burbank 4,161 ($698) 444 41
404 Santa Barbara Unified 194,640 ($700) 445 41
405 West Side Union Elementary 1,009 ($700) 465 60
406 Ross Valley Elementary 24,272 ($702) 434 28
407 Lagunitas Elementary 3,764 ($705) 439 32
408 Merced City Elementary 88,990 ($709) 338 -70
409 Morongo Unified 72,933 ($711) 509 100
410 Acalanes Union High 118,221 ($712) 438 28
411 Helendale Elementary 6,766 ($712) 476 65
412 Westmorland Union Elementary 2,730 ($713) 481 69
413 Antelope Elementary 5,746 ($717) 453 40
414 Loma Prieta Joint Union Elementary 3,954 ($721) 757 343
415 Gold Trail Union Elementary 6,051 ($723) 523 108
416 Tipton Elementary 3,412 ($725) 430 14
417 Santee School District 61,134 ($727) 406 -11
418 Millville Elementary 1,599 ($727) 429 11
419 Spreckels Union Elementary 6,706 ($731) 395 -24
420 Alview-Dairyland Union Elementary 1,859 ($732) 539 119
421 Westwood Unified 1,627 ($732) 228 -193
422 Alum Rock Union Elementary 119,834 ($733) 472 50
423 Summerville Elementary 4,391 ($735) 483 60
424 Gerber Union Elementary 3,481 ($737) 266 -158
425 Etiwanda Elementary 92,259 ($740) 448 23
426 Santa Maria-Bonita 103,991 ($740) 378 -48
427 Kernville Union Elementary 12,311 ($743) 178 -249
428 Livingston Union 16,557 ($752) 345 -83
429 Sundale Union Elementary 2,460 ($755) 639 210
430 Buckeye Union Elementary 37,867 ($757) 512 82
431 San Rafael City Elementary 56,743 ($761) 488 57
432 Menifee Union Elementary 86,768 ($762) 475 43
433 Bass Lake Joint Union Elementary 12,546 ($765) 456 23
434 Union Elementary 48,135 ($769) 385 -49
435 East Whittier City Elementary 75,579 ($771) 471 36
436 Salinas City Elementary 81,923 ($773) 381 -55
437 McSwain Union Elementary 5,778 ($775) 342 -95
438 Waugh Elementary 6,583 ($775) 529 91
439 Manzanita Elementary 1,148 ($783) 516 77
440 Ocean View 18,164 ($783) 839 399
441 Roseville City Elementary 91,553 ($783) 499 58
442 Seeley Union Elementary 3,133 ($790) 600 158
443 Mariposa County Unified 17,347 ($791) 391 -52
444 Los Gatos Union Elementary 29,586 ($792) 400 -44
445 Vallecitos Elementary 2,328 ($792) 317 -128
446 Enterprise Elementary 32,626 ($795) 432 -14
447 Jacoby Creek Elementary 2,678 ($800) 682 235
448 Mesa Union Elementary 3,848 ($801) 436 -12
449 Oroville City Elementary 28,363 ($803) 425 -24
450 Mountain Valley Unified 2,870 ($803) 590 140
451 Rescue Union Elementary 35,588 ($804) 555 104
452 Centinela Valley Union High 156,241 ($805) 727 275
453 Cloverdale Unified 11,131 ($808) 347 -106
454 Pacifica 39,411 ($809) 372 -82
455 Kingsburg Joint Union High 18,505 ($809) 358 -97
456 Washington Union Elementary 7,305 ($810) 519 63
457 Redondo Beach Unified 69,280 ($811) 739 282
458 Dixie Elementary 21,997 ($813) 515 57
459 Nuestro Elementary 316 ($814) 487 28
460 San Gabriel Unified 43,236 ($818) 657 197
461 Sylvan Union Elementary 76,545 ($820) 504 43
462 Ackerman Charter 2,855 ($822) 18 -444
463 Hydesville Elementary 1,386 ($823) 527 64
464 Turlock Unified 86,203 ($824) 559 95
465 Potter Valley Community Unified 2,078 ($826) 550 85
466 Los Alamitos Unified 50,834 ($832) 426 -40
467 Live Oak Elementary 23,633 ($835) 489 22
468 Cypress Elementary 47,025 ($837) 423 -45
469 Byron Union Elementary 16,360 ($838) 482 13
470 Lemoore Union Elementary 25,893 ($840) 479 9

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MOORLACH UPDATE — Reducing Debt Transparency? — September 25, 2019

One More to Veto

As Governor Newsom considers signing or vetoing hundreds of pieces of legislation before the Oct. 13 deadline, allow me to suggest another veto-worthy bill.  As it relates to adding debt, SB 268 (Wiener) will once again limit government transparency and prevent the public from knowing the true costs of bond measures when they appear on ballots.

It appears that Wiener’s bill comes as a reaction to a good government and open transparency bill, Assembly Bill 195, by Assemblyman Jay Obernolte (R – Big Bear), that required local officials to give more information on the cost of bond measures in the ballot summary.

Because local governments hated the idea of giving voters the true costs of the measures, Senator Wiener introduced SB 268. Here’s what CalMatters columnist Dan Walters said about the legislation now awaiting the governor’s signature (see https://calmatters.org/commentary/bill-reduces-ballot-measure-transparency/).

“Wiener makes no bones about his intent. He believes that Obernolte’s law would result in fewer tax and bond measures being passed and his legislation would allow officials to bury the required financial data in the fine print of voter guides, where it would be much less likely to be read.

“Thus, officials would be free once again to pump up their one-sided pitches in ballot summaries.”

California government at all levels should be doing more, not less, to ensure government transparency.  If Governor Newsom believes in transparency, he should veto SB 268.

School District Ranking – Group 4 – #283 to #376

Welcome to the fourth of ten groups of 94 of California’s school districts ranked by the unrestricted net position divided by the district’s population served.

For the previous three groups, see:

Group 1 – MOORLACH UPDATE — School District Rankings – Top 94 — September 20, 2019

Group 2 – MOORLACH UPDATE — 2019 Veto-Worthy Bills and Second 94 — September 21, 2019

Group 3 – MOORLACH UPDATE — School District Rankings, Nos. 189-282 — September 23, 2019

Group 4 includes the following four Orange County school districts:

#320 Huntington Beach Union High, down 78

#333 Savanna Elementary, up 75

#352 Centralia Elementary, up 23

#360 Huntington Beach City Elementary, down 3

Taking a cursory look at Huntington Beach Union High, its Other Post-Employment Benefits (OPEBs) liability increased by $30.5 million. The pension liability increased by $32.5 million. This would explain a major portion of this district’s $72.8 million increase to its unrestricted net deficit. Wouldn’t you like to know this type of information from a school district before you voted to approve a bond measure?

Adding liabilities of this nature to the balance sheets of California’s 940 school districts increased the combined unrestricted net deficit by $20 billion in the last year alone.

25th Anniversary Look Back

Now that we’re on the topic of transparency.  On September 26, 1994, Robert L. “Bob” Citron released his annual Treasurer’s correspondence to the Board of Supervisors.  

It had been reported that, due to Mr. Citron’s difficulty with public speaking, the Supervisors recommended a written report instead.  This one would be his last. It was five pages, with a one-page attachment providing cash balances and receipts and disbursements.  

The mailing list of those who received the correspondence was a who’s who of Orange County financial advisers, broker/dealers, city and school district representatives, Orange County Employees Retirement System directors, prominent civic leaders, and County department heads.

Here are a few selected sentences, followed by my commentary:

Our average yield for the fiscal year of 7.74% can be favorably compared to the U.S. Treasury 30-year maturity bond average yield of 6.65% for the same fiscal year period.

Idle funds should be invested in short-term cash equivalents, similar to a money market fund, with durations averaging 90 days or less.  On the short end of the yield curve, the yields are historically the lowest. Claiming that the Orange County Investment Pool (OCIP) was outperforming the 30-year Treasury should have been a major red flag to its participants.

The State of California Treasury with an average monthly balance of $25.449 billion had an average yield of 4.39%.

The State Treasurer’s Local Agency Investment Fund (LAIF) is a popular place for cities and counties to deposit surplus funds.  To claim that the OCIP was outperforming LAIF by 335 basis points, or 76% higher, should have been another major red flag to participants.

In comparing these interest yields, it should be stated that the State investment pool average monthly maturity for the fiscal year was 392 days (one year, one month); whereas, the Orange County Treasury average monthly maturity was 834 days (two years, five months).

Shortly after Orange County filed for bankruptcy, the majority of municipalities around the nation reduced their average weighted maturity to less than 30 days!  Exceeding a safe holding period by nearly 30 times was yet another major red flag.

The total interest earnings received and paid out from investments was an all time high of $665,868,000.

The massive percentage of overall County revenues represented by interest income was another red flag.  It proved that when money talks, the truth is silent.

We continue to use Reverse Repurchase Agreements as part of our investment strategy.  In the fiscal year just ended, we earned an additional $251,334,000 through Reverse Repurchase Agreements which is the equivalent of adding a 2% yield to our portfolio.

Does the warning that higher yields mean higher risks come to mind?

During the past year, concerns have been raised about investment funds taking “paper” losses which represent the difference between the original cost of securities and the current market value of those securities.  In periods of rising interest rates, securities purchased one year ago are worth less today than when they were originally purchased. The losses are called “paper” losses because they are based upon accounting adjustments in which investment portfolios are adjusted to reflect current market values.  An actual gain or loss would only be incurred if the investor sells the security prior to its maturity day.

Some investment funds regulated by the Securities and Exchange Commission (SEC) are required to periodically adjust the cost of their portfolios to reflect current market values which may result in a paper gain or loss.  Governmental accounting standards do not require municipal investment pools to make this periodic adjustment. Therefore, we are not required to record “paper” gains or losses.

An actual investment gain or loss would only occur if we were to sell a security before its scheduled maturity date.  Under our reverse repurchase investment strategy, we hold nearly all of our securities until maturity and rarely have recorded actual gains or losses.

You can hold to maturity if there is no reason to suspect that an early sale will be required.  But, the OCIP had voluntary participants who could withdraw, theoretically, at any time (for how the city of Tustin was treated, see  MOORLACH UPDATE — Presenting SB 689 Plus a Dozen More — April 17, 2019).  And the OCIP had debt that could be called when the value of the investments dropped below the amount of the loan, thus requiring more collateral by the lender (for a discussion on marking to market, see MOORLACH UPDATE — Marking to Market — July 12, 2019).

In a section titled “The Future,” Citron spent two pages, single-spaced with only a few paragraph breaks, explaining the direction of interest rates, including old phrases about economists.  But, the concluding paragraph hinted at cracks in the dike.  

I do not at all in any way, pretend to be a professional economist.  The rather successful high interest yields we have obtained in previous years (as stated here previously) would indicate that we have been able to interpret current and future markets to our advantage.  Like economists, we are not always right. (Do you remember Henry Kaufman?) In last year’s Financial Statement, I said we would have the maintenance of low interest rates, that high interest rates were not sustainable.  I and many others did not foresee the Federal Reserve taking their “preemptive strike.” There was not then, and there is not now, inflationary factors that would require the Federal Reserve to tighten credit by 1.75%, as stated previously by many economists.  Former President Harry Truman once defined that a successful leader or business head made the correct decisions 80% of the time. I believe I and the great majority of those reading this report fall into this category. Where we may differ is that I realize that my decisions could be wrong as much as 20% of the time.  This probability of error keeps me diligent to see that any miscalculations of economic conditions do not have an overly negative effect on our investors. We have constructed a well-balanced portfolio that we believe can withstand the impact of current interest rates. I believe that the many years of consistent positive results of our investment strategy indicates that our decisions have been correct much more than 80% of the time!

Citron’s report was released in mid-October.  The Federal Reserve Board’s rate increases would continue, correlating closely to the 2-year Treasury yield increases occurring at the time.  Being 80% right would morph into 100% wrong within a few weeks.

For my last LOOK BACK, see MOORLACH UPDATE — OC Register Coverage Look Back — September 16, 2019.

RankSchool DistrictPopulationPer Cap2017Chg
283Trinidad Union Elementary2,248($496)30320
284Soquel Union Elementary27,555($497)277-7
285Millbrae Elementary26,211($500)150-135
286Julian Union High4,837($501)33448
287El Monte Union High178,636($501)276-11
288Cottonwood Union Elementary8,764($503)33951
289Delphic Elementary130($505)764475
290Stanislaus Union Elementary31,828($507)31323
291Chula Vista Elementary301,936($511)37483
292Blue Lake Union Elementary2,513($513)237-55
293Cascade Union Elementary15,318($514)412119
294Perris Union High176,496($516)36874
295Mulberry Elementary153($519)218-77
296Shasta Union High102,753($521)3015
297Trinity Alps Unified8,513($521)238-59
298Jefferson Elementary18,436($524)37173
299Briggs Elementary2,810($525)275-24
300Santa Clara Unified155,963($525)31212
301Liberty Union High115,068($532)31514
302San Luis Coastal Unified95,568($535)34947
303Red Bluff Union Elementary20,495($538)35148
304Loleta Union Elementary1,538($538)279-25
305Lowell Joint34,250($539)247-58
306San Dieguito Union High178,802($543)221-85
307Heber Elementary7,656($544)264-43
308Santa Rosa City Schools293,661($546)31911
309Bennett Valley Union Elementary9,917($548)32617
310Emery Unified11,130($554)34838
311San Mateo Union High242,040($557)32817
312Johnstonville Elementary1,083($558)32210
313Bolinas-Stinson Union2,417($558)171-142
314Los Olivos Elementary2,017($561)485171
315Mountain View Whisman71,425($562)36651
316Plumas Unified18,142($564)248-68
317Grossmont Union High488,461($565)32710
318Santa Maria Joint Union High150,667($566)34123
319Salida Union Elementary21,000($566)37051
320Huntington Beach Union High331,367($567)242-78
321Empire Union Elementary27,056($572)39675
322Hughes-Elizabeth Lakes Union Elem3,898($578)39068
323Oroville Union High55,273($580)189-134
324Salinas Union High180,541($581)321-3
325Mountain View-Los Altos Union High115,648($583)36944
326Antelope Valley Union High386,613($587)34317
327Mill Valley Elementary32,070($588)427100
328Soulsbyville Elementary4,764($591)37749
329San Ardo Union Elementary792($591)39869
330Franklin Elementary2,686($593)35020
331Weed Union Elementary3,950($593)206-125
332Tulare Joint Union High82,517($594)283-49
333Savanna Elementary30,982($594)40875
334Keyes Union6,210($597)37945
335Janesville Union Elementary3,184($601)36429
336Redding Elementary35,510($603)39761
337Grass Valley Elementary25,368($603)38043
338McKinleyville Union Elementary15,531($604)35416
339Barstow Unified35,605($605)38748
340Tracy Joint Unified105,348($606)39959
341Maple Elementary569($606)40160
342Happy Valley Union Elementary6,093($606)231-111
343Sunnyvale92,494($608)332-11
344Colfax Elementary5,865($610)460116
345Coronado Unified26,635($614)591246
346Butte Valley Unified1,989($615)562216
347Hermosa Beach City Elementary20,187($615)210-137
348Burlingame Elementary32,107($615)697349
349South Fork Union3,765($616)262-87
350Roseland12,585($617)520170
351San Rafael City High78,740($617)3521
352Centralia Elementary58,192($618)37523
353Bangor Union Elementary1,304($619)38936
354Placer Union High95,262($620)40450
355Belmont-Redwood Shores Elem43,812($622)243-112
356Moreland51,810($622)3626
357Black Oak Mine Unified14,168($624)461104
358Roberts Ferry Union Elementary615($625)459101
359Modesto City Schools405,888($626)316-43
360Huntington Beach City Elementary87,839($627)357-3
361Mark Twain Union Elementary9,331($628)251-110
362New Hope Elementary1,703($629)294-68
363Weaver Union13,554($631)42158
364Campbell Union102,791($640)38319
365Victor Valley Union High168,238($641)45186
366Fortuna Union High23,003($642)203-163
367Arcata Elementary14,778($643)40235
368Del Mar Union Elementary44,619($645)654286
369Las Lomitas Elementary12,190($647)225-144
370North Cow Creek Elementary1,607($647)578208
371Newcastle Elementary2,857($650)916545
372McCabe Union Elementary7,075($650)38816
373Leggett Valley Unified601($652)333-40
374Bayshore Elementary6,163($652)35-339
375Pleasant Valley77,159($652)337-38
376Marcum-Illinois Union Elementary868($654)41539
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MOORLACH UPDATE — School District Rankings, Nos. 189-282 — September 23, 2019

The California Globe picked up my piece suggesting a Dirty Baker’s Dozen bills that are veto-worthy, which I published in Saturday’s FlashReport and appears again in today’s edition (see MOORLACH UPDATE — 2019 Veto-Worthy Bills and Second 94).

If I were to make one overall generalization of how Sacramento’s supermajority party has been conducting its policy decisions, it would be this: correct symptoms, wrong solutions. Coming to the wrong conclusion after reviewing the facts is a sad sight to behold. In the first piece below, the California Globe focuses on one of them: Charter Schools. Symptom: there is a financial crisis in public schools. Incorrect solution: it must be Charter Schools, so limit them.

School Districts — Numbers 189 to 282

The third group is the second piece below, and it includes, from Orange County districts, Fullerton Joint Union High at #269.

California’s Financial Future Looking Shaky After 2019 Legislative Session

‘We are at debt capacity!’

By Katy Grimes

https://californiaglobe.com/section-2/californias-financial-future-looking-shaky-after-2019-legislative-session/

‘California’s unrestricted net deficit grew by 25 percent in the last year alone’

Following the close of the 2019 legislative session, Sen. John Moorlach (R-Costa Mesa) provided a listing of “California’s Dirty Baker’s Dozen: Veto-Worthy Policy Proposals that Shouldn’t Be Law.”

Many of these bills California Globe covered extensively during the year:

  • AB 44 – the ban on fur
  • SB 1 – the “Trump Resist” bill which would threaten California’s water supply
  • AB 5 – the bill to take over and unionize the rideshare business and related gig economy
  • SB 276 & SB 714 – the mandatory vaccine bills removing doctors medical exemptions, and
  • AB 1482 – ignoring voters recent rejection of a statewide rent control initiative, AB 1482 imposes one anyway

Sen. Moorlach, a Certified Public Accountant by profession, regularly addresses the state’s huge and growing debt. He warns his lawmaker colleagues during committee hearings on taxing and spending bills. He warns them during Senate floor debate before voting on these bills. Yet these bad spending bills continue to be passed by a Legislature apparently unconcerned about the future financial stability of the state.

Most notably, Moorlach recently warned that California’s unrestricted net deficit grew by 25 percent in the last year alone. Moorlach explains that the unrestricted net asset (or deficit) is a summary of the state’s available assets after removing from the balance sheet fixed assets (buildings, parks, roads, etc.) minus outstanding debt obligations for these fixed assets.

Specifically, Moorlach warns about AB 48 by Assemblyman Patrick O’Donnell (D-Long Beach), which will place a $15 billion K-12 through higher education facilities bond on the March 2020 ballot. “We Are At Debt Capacity!” Moorlach said. “California’s Unrestricted Net Deficit grew by $43.8 billion in the last year alone, from $169.5 to $213.3 billion (a 25 percent increase!). If it were not for New Jersey, the Golden State would have the largest deficit of all the 50 states. California needs to improve its balance sheet before it takes on more bond debt, regardless of how noble the cause for the bond proceeds. With rising pension costs, a volatile income tax system, and a potential recession on the horizon, adding more than $700 million in new annual debt payments to the state’s general fund budget may result in additional requests for more taxes and/or significant budget cuts in future years. When California has a supposed budget surplus this year, more debt and taxes make no sense.”

Another big concern are the charter school elimination bills: AB 1505, by Assemblymembers O’Donnell, Bonta, McCarty & Smith, and co-authored by the the powerful state teachers union California Teachers Association, and AB 1507, by Assemblymembers Smith, McCarty, and O’Donnell.

A powerful liaison of aggressive teacher unions and politicians supported by them produced the bills which threaten to destroy California’s wildly popular and successful charter schools, and the 630,000 school children who benefit from them. The bills would cap the number of charter schools in the state, and limit the ability of charter-school organizers to appeal anti-charter decisions by often union-controlled local school boards to county and state boards of education.

“Edging Toward Charter School Elimination: These bills effectively impose a moratorium on charter schools and limit the number and locations of resource centers that a charter school may operate, anticipating their total elimination in California,” Moorlach said. “Neither bill makes any sense to anyone, except those who wish to eliminate charter schools as competition to the incumbent monopoly of traditional public schools over a blended learning or personalized learning environment.”

Moorlach ranked California’s school districts by their cumulative unrestricted net deficit (listing below). He notes “the cumulative unrestricted net deficit for the year ended June 30, 2017 was $50.6 billion. A year later, for the year ended June 30, 2018, it is $70.8 billion. The requirement of including Other Post-Employment Benefits is the main reason the total deficit has grown by $20 billion, or 40 percent, in the last year!”

Limiting California school children’s choices will be costly in many ways, but especially in poor and minority school communities. Charter schools in California have had a very tough time because of teacher union resistance, says Lance Izumi, Director of Education Studies at the Pacific research Institute. Izumi warned that AB 1505 will impose even higher hurdles for charter schools.

AB 1505 changes current California law, which requires proposed charter schools to have 1) financial viability, and 2) a sound academic program. The bill adds in a third criteria: the fiscal impact of the proposed charter school on the school district. If this fiscal impact is found to be negative, the school board can deny the charter school. “Given that most school districts will be able to find some type of financial impact of the proposed charter on that district, it’s going to be used to stifle any creation of charter schools throughout California,” Izumi said. “For charter schools to ‘drain’ public schools of funding, one must assume that students are the property of the regular public schools.”

“Parents and their children voluntarily choose to go to charter schools because charters often perform better, children are safer, and charters offer the type of curriculum and personalized learning that students want,” Izumi said in an interview earlier this year. And really, Izumi says the answer is easy: “School districts can keep students from leaving the regular public schools by simply doing a better job of educating them. It’s within their control.”

Yet, Izumi said charter schools really have no fiscal impact on school districts. His research concurs with Sen. Moorlach’s: the causes of school districts in fiscal distress is found in union contracts negotiated by local school boards, as well as high pension costs and retiree health care. “These are self-inflicted wounds,” Izumi says. “Using charter schools as scapegoats by districts in financial distress is factually wrong and diverts attention from the real causes, which is these actions by the school districts and the boards which approve things they cannot afford.”

Rank School District Population Per Cap 2017 Chg County
189 Guerneville Elementary 5,298 ($296) 252 63
190 Vallecito Union 10,315 ($298) 291 101
191 Trona Joint Unified 1,992 ($299) 3 -188
192 San Benito High 53,901 ($302) 209 17
193 Petaluma City Schools 108,166 ($303) 310 117
194 Wilmar Union Elementary 3,402 ($307) 212 18
195 Corning Union High 17,298 ($318) 353 158
196 Sebastopol Union Elementary 12,192 ($320) 185 -11
197 Surprise Valley Joint Unified 1,164 ($323) 173 -24
198 Pacheco Union Elementary 8,776 ($325) 202 4
199 Pioneer Union Elementary 1,581 ($325) 268 69
200 Oak Grove Union Elementary 5,200 ($328) 183 -17
201 Horicon Elementary 1,712 ($329) 205 4
202 La Honda-Pescadero Unified 3,719 ($331) 61 -141
203 Hanford Joint Union High 68,472 ($335) 179 -24
204 Lewiston Elementary 1,552 ($335) 226 22
205 Banta Elementary 5,663 ($338) 215 10
206 Tamalpais Union High 117,152 ($338) 200 -6
207 Rio Dell Elementary 3,508 ($341) 216 9
208 Pacific Union Elementary 4,847 ($343) 207 -1
209 Bella Vista Elementary 3,840 ($343) 234 25
210 Dunsmuir Elementary 2,091 ($346) 270 60
211 Willow Creek Elementary 635 ($350) 296 85
212 Westside Elementary 1,409 ($354) 723 511
213 Springville Union Elementary 3,992 ($359) 244 31
214 Pleasant Ridge Union Elementary 20,804 ($359) 256 42
215 Wright Elementary 17,715 ($360) 227 12
216 Mt. Shasta Union Elementary 7,068 ($363) 290 74
217 Liberty Elementary 2,124 ($364) 254 37
218 Southside Elementary 1,915 ($374) 274 56
219 Santa Cruz City Schools 188,916 ($377) 220 1
220 Ballard Elementary 1,513 ($378) 137 -83
221 Bellflower Unified 84,178 ($380) 298 77
222 Pioneer Union Elementary 5,628 ($382) 299 77
223 Fallbrook Union High 67,486 ($383) 288 65
224 Julian Union Elementary 4,353 ($386) 153 -71
225 Jefferson Union High 153,271 ($387) 211 -14
226 South Bay Union Elementary 7,022 ($388) 340 114
227 Brawley Union High 29,958 ($389) 196 -31
228 Kern High 634,352 ($389) 253 25
229 Semitropic Elementary 371 ($390) 72 -157
230 Red Bluff Joint Union High 43,298 ($393) 452 222
231 Nicasio Unified School District 728 ($393) 361 130
232 Old Adobe Union 26,769 ($395) 188 -44
233 Jefferson Elementary 93,171 ($396) 192 -41
234 Romoland Elementary 26,829 ($401) 903 669
235 Grenada Elementary 1,035 ($401) 433 198
236 Goleta Union Elementary 80,388 ($404) 265 29
237 Snelling-Merced Falls Union Elem 720 ($406) 65 -172
238 Feather Falls Union Elementary 414 ($406) 141 -97
239 Northern Humboldt Union High 45,079 ($406) 249 10
240 Yreka Union Elementary 9,707 ($410) 346 106
241 Scotts Valley Unified 18,579 ($412) 450 209
242 Santa Rita Union Elementary 23,795 ($414) 300 58
243 Delano Joint Union High 74,502 ($416) 198 -45
244 San Bruno Park Elementary 39,068 ($419) 229 -15
245 Mountain Elementary 1,353 ($421) 318 73
246 Big Oak Flat-Groveland Unified 5,230 ($422) 293 47
247 Auburn Union Elementary 36,523 ($423) 314 67
248 Solvang Elementary 6,058 ($424) 309 61
249 Lemoore Union High 38,047 ($424) 269 20
250 Piner-Olivet Union Elementary 16,561 ($425) 284 34
251 Washington Colony Elementary 3,030 ($426) 409 158
252 Ducor Union Elementary 1,336 ($428) 363 111
253 Lake Elementary 419 ($432) 87 -166
254 Bret Harte Union High 19,646 ($432) 259 5
255 East Side Union High 569,455 ($433) 214 -41
256 Big Valley Joint Unified 1,626 ($433) 162 -94
257 Galt Joint Union High 40,727 ($438) 307 50
258 Earlimart Elementary 11,139 ($443) 177 -81
259 Richfield Elementary 1,202 ($445) 446 187
260 Columbia Elementary 9,908 ($454) 222 -38
261 Merced Union High 177,642 ($454) 260 -1
262 El Dorado Union High 142,706 ($456) 285 23
263 Rincon Valley Union Elementary 42,067 ($460) 257 -6
264 Solana Beach Elementary 40,364 ($463) 250 -14
265 West Sonoma County Union High 49,457 ($465) 233 -32
266 Mother Lode Union Elementary 16,073 ($471) 245 -21
267 Vineland Elementary 4,470 ($471) 128 -139
268 Monson-Sultana Joint Union Elem 2,547 ($474) 263 -5
269 Fullerton Joint Union High 264,447 ($474) 239 -30
270 Howell Mountain Elementary 3,791 ($475) 306 36
271 Wheatland Union High 14,213 ($476) 302 31
272 Walnut Creek Elementary 51,759 ($478) 566 294
273 Roseville Joint Union High 179,300 ($478) 336 63
274 Gold Oak Union Elementary 8,689 ($478) 297 23
275 Placer Hills Union Elementary 15,148 ($480) 286 11
276 Clear Creek Elementary 1,735 ($483) 344 68
277 Hope Elementary 16,376 ($486) 405 128
278 S. Monterey County Jt Union High 38,961 ($486) 273 -5
279 Dos Palos Oro Loma Joint Unified 11,135 ($487) 281 2
280 Cayucos Elementary 3,021 ($489) 217 -63
281 Pollock Pines Elementary 9,166 ($492) 329 48
282 Placerville Union Elementary 15,965 ($493) 311 29

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MOORLACH UPDATE — 2019 Veto-Worthy Bills and Second 94 — September 21, 2019

2019 Baker’s Dozen Veto-Worthy Bills

We continue the tradition of recommending a gubernatorial veto for the bills put on the Governor’s desk after the rushed bill passage at the conclusion of Session (see MOORLACH UPDATE — 2018 Top 20 Veto Worthy Bills — September 13, 2018, MOORLACH UPDATE — 2017 Top 20 Veto Worthy Bills — September 22, 2017, MOORLACH UPDATE — 2016 Veto Worthy Bills — September 12, 2016 and MOORLACH UPDATE — Worst and Vaguest — September 22, 2015).

During the concluding weeks of the legislative session, we put together a list of bills we think are poor public policy and should not become law. Within minutes of the close of Session, my staff and I start to compile the worst bills. It is then provided for The FlashReport and is the first piece below. We usually provide 20 bills, though in reality there are exponentially more. However, this year we are presenting a more manageable 13 bills or categories. Regretfully, the Governor has already signed a few of them — that’s how quick he is moving. Now you know why we compile the list as fast as possible.

We hope that the Governor makes good decisions on some very politically charged bills. I’ll try to let you know how things go over the next few weeks.

School Districts — Numbers Ninety-Five to One-Hundred-Eighty-Eight

The next 94 school districts are provided in the second piece below. In the first group of 94, among Orange County’s school districts, Fountain Valley Elementary School District made it to the 80th position, moving up 22 positions of 944 statewide (see MOORLACH UPDATE — School District Rankings – Top 94 — September 20, 2019).

In this second group, Laguna Beach Unified School District makes it to 161st place, moving up 19 positions.

State Senator John Moorlach

California’s Dirty Baker’s Dozen: Veto-Worthy Policy Proposals that Shouldn’t Be Law

Posted by State Senator John Moorlach

http://www.flashreport.org/blog/2019/09/20/californias-dirty-bakers-dozen-veto-worthy-policy-proposals-that-shouldnt-be-law/

Publisher’s Note: Every year after the end of legislative session the FlashReport works with one or two legislators to publish a list of the worst of the bad bills passed by Senate and Assembly, and sent to the Governor for consideration. This last legislative session was, predictably, not a good one for those who embrace the ideas of liberty and freedom – and who embrace the concepts of individual liberty and individual responsibility. This year we are excited to again work with conservative State Senator John Moorlach as we present to you a Baker’s Dozen, or 13, of the worst pieces of legislation to make it to the Governor. As of publication he has already vetoed one, SB 1, and signed one, AB5. When he is done we will publish a recap of what did or did not become law from the list. — Flash

SB 1 (Atkins, Portantino & Stern) – California Doesn’t Care What Federal Environmental Law Says: This bill is a partisan missile thrown at the Trump Administration for clearing up a mess of convoluted and conflicting federal environmental laws made worse by a patchwork of presidential executive orders and Supreme Court rulings over the last several decades. It turns out that top Congressional Democrats felt like the California Legislature was overreaching and asked that the bill not go forward because it would have hindered a lot of good work on water projects desperately needed throughout the state.

AB 5 (Gonzalez) – Lose/Lose for Workers & Businesses: I’ve written a lot over the years about the distinct differences between a legitimate employee and a contractor. The rules were fairly clear until a California company decided to abuse the law and its workforce. Instead of the California Supreme Court rendering a judgment on a specific company, it produced a terrible precedent upon every other company in the state. This bill codifies a poor ruling in an aggressive move to unionize more employees and punish businesses who legitimately and logically retain independent contractors, thus all the carve-outs in the bill. I predict devastating impacts upon our small businesses and gig economy with a lot of legislative fixes next year as the reality of this bill catches up with the theory.

SB 24 (Leyva) – A Political Hot Potato California Public Universities Didn’t Request: Neither the University of California nor California State University asked for this bill. No other states require their universities to provide medical abortions in student health centers. The state is replete with abortion providers, many near our college campuses. Perhaps our Legislature should be encouraging our colleges to focus on educating students, rather than engaging in controversial health issues.

State Sen. John Moorlach

AB 44 (Friedman) – Banning Fur; What’s Next? There is no unique circumstance to the fur-producing industry that doesn’t already apply to other animal-based commodities, making it unclear why the state should ban fur exclusively. If people don’t like fur-based products, the marketplace will signal as such and an alternative will readily take its place. The state should not be in the business of killing businesses it disagrees with.

AB 48 (O’Donnell) – We Are At Debt Capacity! California’s Unrestricted Net Deficit grew by $43.8 billion in the last year alone, from $169.5 to $213.3 billion (a 25 percent increase!). If it were not for New Jersey, the Golden State would have the largest deficit of all the 50 states. California needs to improve its balance sheet before it takes on more bond debt, regardless of how noble the cause for the bond proceeds. With rising pension costs, a volatile income tax system, and a potential recession on the horizon, adding more than $700 million in new annual debt payments to the state’s general fund budget may result in additional requests for more taxes and/or significant budget cuts in future years. When California has a supposed budget surplus this year, more debt and taxes make no sense.

SB 113 (Committee on Budget) – Stolen Housing Assistance: The state should not take money legally obtained and intended for one purpose and then spend it on a different purpose. That’s what happened when the Legislature repeatedly took court-awarded money from Californians hit by the housing crisis after waiting seven years to get the help they deserved. This bill continues to delay the assistance of $331 million in relief to struggling homeowners, jeopardizing the intent of the settlement.

SB 276 (Pan) & SB 714 (Pan) – Bureaucratizing Vaccines: Both these bills are not about fully vaccinating everyone in our public schools, because if they were, then the legislation would go beyond students and require that all teachers, administratiors and classified staff be vaccinated and have updated boosters, which it does not. Rather, these bills chill the doctor/patient relationship and replace it with a bureaucratic board mandated to make critical, yet uninformed, health decisions for medically fragile children.

SB 328 (Portantino) – Late Delays at Ridgemont High: In addition to further regulations on charter schools, mandating later start times for public high schools would be a killer on the working family. It’s already difficult enough as it is to coordinate school drop-off times. For school districts that desire later start times, let them make that decision and be held accountable by the local citizens.

SB 696 (Umberg) – Disingenuous Disenfranchisement Act of 2019: This bill would effectively ban California’s third-largest political party from the ballot. The American Independent Party has been recognized and qualified in California since 1968. With more than 518,000 registered voters, forcing an established political party to change its name and forfeit its longstanding identity with the voting public would clearly impose a severe burden on its constitutional rights. Banning a political party’s chosen name is a drastic remedy for the alleged ignorance of some voters, who can easily re-register themselves, if they so wish, up to and including on the day of the election.

AB 857 (Chiu & Santiago) – A Slightly Better Bad Banking Idea: Given the great expense of starting public banks, it will likely prove to be far too expensive for any local government to undertake. I know this because I tried to do it while serving as Orange County’s Treasurer-Tax Collector. The difficulties and expenses of creating a public bank would prove a futile and potentially expensive failure if seriously undertaken.

AB 1290 (Atkins) – Project Labor Agreements Über Alles: One of the legislature’s favorite parlor games – gutting and amending bills at the end of session and circumventing a fair public review process – turns out to also thwart the will of local San Diego voters after they supported Proposition A. This legislation usurps San Diego voters’ desire to have union and non-union workers get an equal shot at work on city-funded projects.

AB 1482 (Chiu, Bloom, Bonta, Grayson & Wicks) – Ignoring the Voters to Get a Rent Cap: Just last year, California voters overwhelmingly rejected Proposition 10, which would have allowed local jurisdictions to enact rent control ordinances in a supposed effort to help prevent further homelessness, with over 59% of the voters opposing the proposition. Given the strong disfavor for this policy, it seems highly irregular for the Legislature to then adopt this policy, thus ignoring the will of the voters.

AB 1505 (O’Donnell, Bonta, McCarty & Smith) & AB 1507 (Smith, McCarty, & O’Donnell) – Edging Toward Charter School Elimination: These bills effectively impose a moratorium on charter schools and limit the number and locations of resource centers that a charter school may operate, anticipating their total elimination in California. Neither bill makes any sense to anyone, except those who wish to eliminate charter schools as competition to the incumbent monopoly of traditional public schools over a blended learning or personalized learning environment.

Rank School District Population Per Cap 2017 Chg
95 Pacific Elementary 877 $3 278 183
96 Lassen View Union Elementary 2,845 ($7) 124 28
97 McCloud Union Elementary 1,321 ($11) 138 41
98 Paradise Elementary 947 ($12) 94 -4
99 Caliente Union Elementary 973 ($16) 96 -3
100 Happy Valley Elementary 1,480 ($17) 134 34
101 Palo Verde Union Elementary 2,835 ($18) 117 16
102 Winton 11,013 ($18) 160 58
103 Summerville Union High 9,905 ($20) 109 6
104 Lucerne Elementary 3,395 ($23) 123 19
105 Garfield Elementary 331 ($25) 76 -29
106 Chicago Park Elementary 1,217 ($25) 163 57
107 Alta-Dutch Flat Union Elementary 1,979 ($36) 112 5
108 Bridgeville Elementary 560 ($42) 131 23
109 Santa Ynez Valley Union High 22,222 ($47) 133 24
110 Whitmore Union Elementary 737 ($50) 129 19
111 Fieldbrook Elementary 874 ($53) 121 10
112 El Nido Elementary 1,793 ($68) 144 32
113 Three Rivers Union Elementary 2,383 ($71) 118 5
114 Burnt Ranch Elementary 741 ($72) 201 87
115 Somis Union 3,279 ($75) 122 7
116 Death Valley Unified 744 ($77) 145 29
117 Round Valley Joint Elementary 1,051 ($79) 100 -17
118 Raymond-Knowles Union Elem 1,305 ($80) 143 25
119 Wasco Union High 31,840 ($83) 99 -20
120 Wasco Union Elementary 27,978 ($88) 295 175
121 Strathmore Union Elementary 5,866 ($91) 110 -11
122 Peninsula Union 480 ($91) 161 39
123 Liberty Elementary 1,978 ($92) 194 71
124 Warner Unified 2,481 ($92) 172 48
125 Chowchilla Elementary 22,780 ($93) 132 7
126 Browns Elementary 976 ($102) 91 -35
127 Knights Ferry Elementary 648 ($106) 155 28
128 Southern Trinity Joint Unified 1,005 ($114) 230 102
129 Oak Run Elementary 609 ($117) 114 -15
130 Shaffer Union Elementary 9,317 ($118) 140 10
131 Jamestown Elementary 8,863 ($119) 149 18
132 Igo, Ono, Platina Union Elementary 1,025 ($122) 271 139
133 Big Lagoon Union Elementary 462 ($126) 127 -6
134 Lassen Union High 25,153 ($130) 147 13
135 Pleasant Valley Joint Union Elem 923 ($132) 261 126
136 South San Francisco Unified 83,655 ($138) 81 -55
137 Manchester Union Elementary 639 ($143) 176 39
138 Kashia Elementary 81 ($145) 292 154
139 Tres Pinos Union Elementary 834 ($151) 158 19
140 Oak View Union Elementary 3,079 ($153) 208 68
141 Foresthill Union Elementary 6,709 ($155) 142 1
142 Nevada City Elementary 15,578 ($160) 157 15
143 Sierra-Plumas Joint Unified 3,599 ($160) 152 9
144 Twain Harte 5,513 ($163) 98 -46
145 Pond Union Elementary 737 ($166) 52 -93
146 Columbia Union 6,069 ($181) 170 24
147 Di Giorgio Elementary 976 ($186) 90 -57
148 Cinnabar Elementary 2,699 ($187) 139 -9
149 Reeds Creek Elementary 1,291 ($189) 232 83
150 Green Point Elementary 234 ($195) 106 -44
151 Campbell Union High 239,748 ($196) 164 13
152 Big Pine Unified 1,808 ($197) 108 -44
153 Sonora Union High 39,113 ($199) 168 15
154 Rockford Elementary 1,356 ($203) 95 -59
155 Yreka Union High 17,369 ($209) 181 26
156 Junction Elementary 3,750 ($216) 219 63
157 Susanville Elementary 10,390 ($219) 135 -22
158 Wheatland 7,707 ($224) 67 -91
159 Columbine Elementary 275 ($225) 224 65
160 Atwater Elementary 36,162 ($225) 159 -1
161 Laguna Beach Unified 29,473 ($233) 180 19
162 Penn Valley Union Elementary 13,030 ($234) 184 22
163 Sonora Elementary 8,719 ($235) 167 4
164 Curtis Creek Elementary 8,974 ($242) 166 2
165 Shasta Union Elementary 2,308 ($247) 272 107
166 Big Sur Unified 467 ($248) 119 -47
167 Cutten Elementary 5,311 ($249) 130 -37
168 Black Butte Union Elementary 4,433 ($249) 367 199
169 Montague Elementary 1,955 ($250) 304 135
170 Lakeside Joint 2,733 ($252) 223 53
171 Latrobe 2,767 ($256) 197 26
172 Evergreen Union 9,440 ($257) 174 2
173 Golden Feather Union Elementary 2,787 ($258) 126 -47
174 Siskiyou Union High 15,823 ($258) 236 62
175 Anderson Union High 38,951 ($262) 154 -21
176 Pine Ridge Elementary 906 ($263) 89 -87
177 Arcohe Union Elementary 4,980 ($265) 175 -2
178 Fremont Union High 243,263 ($266) 191 13
179 Sequoia Union Elementary 2,185 ($267) 148 -31
180 Valley Home Joint Elementary 1,776 ($274) 186 6
181 Pleasant Grove Joint Union 908 ($280) 213 32
182 Sausalito Marin City 11,035 ($280) 182 0
183 San Antonio Union Elementary 1,941 ($288) 246 63
184 Modoc Joint Unified 5,983 ($289) 116 -68
185 Nevada Joint Union High 83,537 ($289) 204 19
186 Fortuna Elementary 13,711 ($289) 195 9
187 Chowchilla Union High 24,639 ($292) 190 3
188 Butteville Union Elementary 1,704 ($294) 240 52

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MOORLACH UPDATE — School District Rankings – Top 94 — September 20, 2019

Born to Serve

The September/October 2019 edition of the Old Towne Orange Plaza Review has a “Know the Neighbors” segment that includes Orange County District Attorney Todd Spitzer, former Orange County Supervisor and Ambassador to the Vatican Gaddi Vasquez, and me. It’s the first piece below.

School Districts — Numbers One to Ninety-Four

We’ve patiently waited for the annual audited financial statements for California’s school districts for the year ended June 30, 2018. It is normally anticipated that the audits be completed in six months, no later than December, so being more than eight months later is a matter of concern.

This massive delay could be due to so many of our state’s school districts serving very small populations, there may not be enough Certified Public Accountancy auditing firms to complete this annual workload in a timely manner in certain areas, or the balance sheets took a bigger hit than expected this year, thanks to the inclusion of retiree medical liabilities and the required actuarial reports.

The cumulative Unrestricted Net Deficit for California’s school districts for the year ended June 30, 2017 was $50.6 billion. A year later, for the year ended June 30, 2018, it is $70.8 billion. The requirement of including Other Post-Employment Benefits is the main reason the total deficit has grown by $20 billion, or 40 percent, in the last year!

There is also plenty of movement among the 940 audited districts. Those below with major ranking changes are districts in smaller communities. It would be interesting to learn the actual stories behind their movement.

Since there are so many districts, I’m releasing the details over 10 UPDATEs, providing 94 in each issue. I did this for last year’s rankings, with 14 editions of some 67 districts each. The second piece below is Group 1, the 94 school districts with the best Unrestricted Net Assets per capita. They are provided in numerical order, with the district’s name, population, unrestricted net position per capita, prior rank and the movement from last year’s position in the rankings.

For last year’s full study on California’s educational fiscal rankings, please go to https://moorlach.cssrc.us/sites/default/files/181002_CASchoolCAFRReport.pdf.

BORN TO SERVE

John Moorlach

California history is a passion for state Sen. John Moorlach.

There are more than 1,060 California Historical Landmarks, and Moorlach has visited them all —except for 100 or so. At his Costa Mesa home, he has what he calls a “massive” library of books about the Golden State with subsections on each of its 58 counties and many of its 482 municipalities.

“I never would have thought that I would be a state legislator, but it actually fits right in, because I’ve been traveling throughout California for 40 years,” says Moorlach, a Republican who represents the 37th district, which includes most of Orange.

A certified public accountant and financial planner, Moorlach’s original career plans didn’t involve public service. However, in 1994 he accurately predicted that Orange County’s risky investment practices would lead to bankruptcy. After the county’s then-treasurer resigned late that year, Moorlach was appointed to the post, where he served for nearly 12 years.

In 2006, he was elected to the first of two terms as Second District supervisor, helping the county emerge from bankruptcy and improve its financial standing. And as a state senator since March 2015, Moorlach has continued to champion fiscal responsibility.

To that end, Moorlach sponsored SB 598, the Open Financial Statements Act, which will help modernize California’s municipal financial reporting practices. It has the support of Treasurer Fiona Ma, a Democrat, and was recently being considered by the Assembly’s Appropriations Committee.

“John is well-received across the board, with Republicans and Democrats,” says Janice Swift, a fellow CPA who has known Moorlach since his first campaign for treasurer. “He is a conservative and a strong Christian and family man. All of that comes across for a lot of people, regardless of their party.”

Moorlach, the only CPA in the 120-seat state Legislature, has five additional bills working their way through the Assembly, including one that addresses the retirement system for judges and another that offers protections against the financial abuse of elders and dependent adults.

“I’m here to make sure that government is doing what it’s supposed to be doing,” he says. “And that’s why I ran for the state Senate—to get things done.”

While the legislature was on summer break, Moorlach was planning to visit a couple more landmarks that are still outstanding on his list. Every stop includes photographing the plaque that identifies the landmark and explains its historical significance.

“They’re really boring photos,” he admits. “I’m an accountant, not a photographer.”

John M.W. Moorlach district office 940 South Coast Dr., Suite 185, Costa Mesa / 714-662-6050

Rank School District Population Per Cap 2017 Chg
1 McKittrick Elementary 177 $48,698 2 1
2 Spencer Valley Elementary 484 $13,842 1 -1
3 Maple Creek Elementary 49 $6,877 5 2
4 Gorman Joint 154 $6,270 4 0
5 Oro Grande Elementary 1,170 $5,320 701 696
6 Ravendale-Termo Elementary 148 $4,566 8 2
7 Santa Clara Elementary 174 $4,146 6 -1
8 Desert Center Unified 268 $3,054 11 3
9 Little Shasta Elementary 324 $3,024 10 1
10 Alpine County Unified 1,120 $2,942 9 -1
11 Baker Valley Unified 1,031 $2,870 17 6
12 Bitterwater-Tully Elementary 134 $2,825 12 0
13 Panoche Elementary 135 $2,710 16 3
14 Cienega Union Elementary 182 $2,704 15 1
15 Saucelito Elementary 187 $2,638 7 -8
16 Winship-Robbins 616 $2,056 32 16
17 Silver Fork Elementary 255 $1,967 24 7
18 Hornbrook Elementary 695 $1,943 22 4
19 Mountain House Elementary 380 $1,914 26 7
20 Lincoln Elementary 218 $1,827 14 -6
21 Mendota Unified 13,075 $1,796 29 8
22 Orick Elementary 386 $1,652 21 -1
23 Junction Elementary 147 $1,551 28 5
24 Forks of Salmon Elementary 206 $1,489 30 6
25 Cucamonga Elementary 28,817 $1,461 23 -2
26 San Lucas Union Elementary 414 $1,445 104 78
27 Lost Hills Union Elementary 2,922 $1,417 39 12
28 Meridian Elementary 666 $1,374 36 8
29 Blochman Union Elementary 774 $1,328 42 13
30 Twin Ridges Elementary 2,572 $1,309 31 1
31 Plainsburg Union Elementary 473 $1,280 20 -11
32 Shiloh Elementary 798 $1,192 38 6
33 Camptonville Elementary 788 $1,188 33 0
34 Seiad Elementary 320 $1,175 27 -7
35 Outside Creek Elementary 758 $1,091 50 15
36 Hot Springs Elementary 332 $959 43 7
37 Island Union Elementary 1,455 $888 45 8
38 Blake Elementary 180 $879 44 6
39 Lakeside Union Elementary 2,542 $860 41 2
40 French Gulch-Whiskeytown Elem 446 $834 25 -15
41 Gravenstein Union Elementary 5,710 $825 37 -4
42 Richmond Elementary 1,031 $800 48 6
43 Montecito Union Elementary 6,529 $785 46 3
44 Laguna Joint Elementary 364 $780 34 -10
45 Richgrove Elementary 3,413 $737 60 15
46 Fort Ross Elementary 645 $731 47 1
47 Douglas City Elementary 826 $724 73 26
48 Lagunita Elementary 306 $690 57 9
49 Willow Grove Union Elementary 289 $666 51 2
50 Mountain Union Elementary 1,302 $646 56 6
51 Kirkwood Elementary 299 $613 40 -11
52 Fort Sage Unified 2,969 $607 55 3
53 Laton Joint Unified 3,958 $501 49 -4
54 Big Creek Elementary 472 $499 58 4
55 Vista del Mar Union 527 $492 19 -36
56 Bogus Elementary 360 $488 75 19
57 Trinity Center Elementary 421 $481 78 21
58 Alexander Valley Union Elementary 915 $475 53 -5
59 Linns Valley-Poso Flat Union 649 $473 120 61
60 Mark West Union Elementary 14,892 $426 70 10
61 Mupu Elementary 1,005 $412 54 -7
62 Montgomery Elementary 886 $411 68 6
63 Belleview Elementary 1,725 $395 66 3
64 Coffee Creek Elementary 220 $362 59 -5
65 Raisin City Elementary 2,150 $362 105 40
66 Kenwood 4,286 $357 80 14
67 Elkins Elementary 273 $354 74 7
68 General Shafter Elementary 1,142 $350 940 872
69 Gazelle Union Elementary 292 $329 79 10
70 Dunsmuir Joint Union High 2,454 $315 64 -6
71 Dehesa Elementary 2,374 $301 289 218
72 Harmony Union Elementary 4,490 $279 62 -10
73 Klamath River Union Elementary 473 $275 92 19
74 Waukena Joint Union Elementary 1,030 $240 85 11
75 Indian Diggings Elementary 167 $230 84 9
76 Imperial Unified 22,298 $208 478 402
77 Jefferson Elementary 206 $206 77 0
78 Stone Corral Elementary 751 $194 86 8
79 Happy Camp Union Elementary 1,312 $174 88 9
80 Fountain Valley Elementary 57,140 $170 102 22
81 Hart-Ransom Union Elementary 4,505 $168 69 -12
82 San Pasqual Valley Unified 3,629 $129 635 553
83 Flournoy Union Elementary 270 $111 82 -1
84 Merced River Union Elementary 858 $84 187 103
85 Indian Springs Elementary 220 $73 103 18
86 Big Springs Union Elementary 1,762 $57 136 50
87 North County Joint Union Elem 3,717 $46 107 20
88 Kneeland Elementary 335 $43 101 13
89 Monte Rio Union Elementary 2,298 $26 113 24
90 Bonny Doon Union Elementary 3,084 $23 111 21
91 Cuddeback Union Elementary 898 $14 83 -8
92 Armona Union Elementary 6,546 $11 125 33
93 Kit Carson Union Elementary 2,408 $10 146 53
94 Junction City Elementary 692 $6 97 3

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MOORLACH UPDATE — Against Spiritual Segregating — September 17, 2019

Shortly after arriving at the Capitol in 2015, I found myself voting against Senate Joint Resolution 4 because I opposed switching out Father Junipero Serra for Astronaut Sally Ride as one of the two statues representing California in the nation’s Capital in Washington, D.C. (see MOORLACH UPDATE — PAD Review — April 14, 2015; the second statue is Ronald Reagan). Governor Brown would ask the author to drop the bill because the Catholic Church planned to canonize Father Serra as a saint later in the year and the Governor had also made plans to meet the Pope.

SCR 4 was an effort to have someone represent California from the LGBT community. It was my introduction to a movement by the LGBT Caucus to get the attention of those in the faith- based community. Going after the Roman Catholic Church in California was a bold move.

The author of SCR 4 came back the next year with SB 1146 (2016), to address certain universities with codes of conduct that were perceived to discriminate against the LGBT community (see MOORLACH UPDATE — Religious Liberty — July 1, 2016 and MOORLACH UPDATE — Oblivious — June 28, 2016). At the time, I warned the author that those who had been discriminated against in the past shouldn’t now discriminate against others. Also, we need to be careful about what we hate, like intolerance, so we do not become like what we hate. Governor Brown signed the bill.

Last year saw Assembly Bill 2943 (2018) addressing “conversion therapy,”classifying it as a fraudulent business activity (see MOORLACH UPDATE — California School District Rankings, Group 10 — August 24, 2018).

There are a lot of terrible and nonsensical techniques used in the past that offend humane sensibilities and should have never been used. That included lobotomies, which I also denounced. However, people should not be barred from seeking spiritual counseling and guidance by their own choosing, regardless of why they seek help from their chosen religion. Professionals who provide counseling and guidance should not be prohibited from being compensated for their services. This is about freedom.

The author of AB 2943 came from his personal framework, that those in the LGBT community cannot change and any effort to do so was psychological torture. Again, the state should not interfere with people’s freedom to practice religion and seek spiritual help. Numerous individuals who had sought out such guidance and benefited from it were now feeling marginalized and discriminated against by some in the LGBT community, of which they were former members. There are many reasons why people move between LGBT relationships and heterosexual relationships. Who are we to tell people they have to conform to any single standard? Furthermore, eliminating options for people seeking counseling can ultimately cause more harm than good.

The author put AB 2943 on the inactive file the last day or two of last year’s Session. During the fall break, he worked with various spiritual leaders around the state to craft Assembly Concurrent Resolution 99. It’s a method of pursuing the “why can’t we all get along?” approach to this collision of the spiritual and physical worlds.

Sexuality is very important. It’s intimate and special. That’s why we discourage adultery and emphasize fidelity in the marriage relationship. For many, having a strong spiritual relationship assists when facing urges to divert their focus on the physical aspects of life. The spiritual component of one’s life can provide healing, wholeness, and human flourishing.

Ruling out this avenue of personal growth for the soul means that Sacramento is establishing spiritual segregation. It’s another intrusion on one’s personal freedom to be free to choose what they deem is most important for them and their personal life’s journey.

The idea that people should have the freedom to seek out therapy and spiritual guidance, if they so choose, is what I tried to communicate on the Senate Floor when I spoke against ACR 99 (2019). I see this Resolution as another step in the wrong direction from a legislative body that should instead be encouraging inclusiveness and freedom.

The California Family Counsel and Christian Today provide their pieces, respectively, on this sensitive subject matter below.

Senate Demands Pastors Reject Biblical Counseling For LGBT Californians

https://californiafamily.org/2019/senate-demands-pastors-reject-biblical-counseling-for-lgbt-californians/

Last week, the California Senate gave party-line approval to Assembly Concurrent Resolution 99, a resolution demanding people of faith in the state change how they teach, preach, and counsel others related to LGBT identities and behaviors. Authored by Assemblyman Evan Low (D-San Jose), ACR 99 condemns pastors, counselors, and religious workers who offer compassionate support to the fellow Californians struggling with unwanted same-sex attraction or gender identity confusion.

Most shockingly, ACR 99 goes so far as to blame the so-called “stigmatizing beliefs” of these individuals and organizations for the high rates of depression and suicide in the LGBT community. The resolution was a direct follow up to last year’s AB 2943 which California Family Council worked to defeat due to similar constitutional concerns. We strongly encourage you to read ACR 99 for yourself.

Thankfully, several senators recognized the serious legal flaws ACR 99, particularly its attack on the First Amendment. Senator Andreas Borgeas (R-Fresno) stated that even though the resolution didn’t have the force of law, “we are treading into freedom of speech territory that I think should concern all of us. When an individual seeks therapy or guidance before a religious leader, whether it be a mosque, a temple, or a church, that’s a private setting…To disallow or create the pathway where we tell individuals they can not say certain things should give us pause.”

Senator John Moorlach (R-Irvine) rose to warn legislators of the clear religious liberty implications of the legislation. He acknowledged that he does not support all of the counseling methods sometimes categorized as “conversion therapy.” But, “how can we foreclose on spiritual counseling when someone is on a journey and honestly inquiring about wanting to change and wants professional assistance?” Moorlach asked his fellow senators.

Sadly, other senators used ACR 99 as a platform to attack former LGBTQ men and women who seek to share their stories of life transformation. Scott Wiener (D-San Francisco) sneeringly called any efforts to change sexual orientation and gender identity “psychological torture.” Jim Beall (D-San Jose) smeared faith-based groups as engaging in “mental health malpractice.”

Senator Hannah Beth Jackson (D-Santa Barbara) implied change therapy discriminates against those who identify as LGBTQ. “Until recently, the interpretation of the First Amendment was that one religion could not impose itself on other religions,” she argued. To say “one should have religious freedom to discriminate against others is a relatively new concept.”

These slanderous statements were simply bizarre. ACR 99 does not clearly define so-called “conversion therapy.” It does not even mention psychologists, psychiatrists, or mental health professionals. Instead, it targets churches, counselors, and even formerly LGBTQ Christians. Sadly, these vitriolic and bigoted attacks on California’s faith community went largely unchallenged.

Just before the vote, Senate Minority Leader Shannon Grove (R-Bakersfield) rose to tell her colleagues she thought the resolution was simply to remind pastors to be loving and compassionate to LGBT identified people. While not mentioning the concerns raised by her Republican colleagues, Grove focused on the part of the resolution that called on “religious leaders to counsel on LGBTQ matters from a place of love, compassion.”

Grove later told California Family Council she had worked hard to organize meetings with Assemblyman Low and evangelical pastors in opposition to last year’s AB 2943, but she saw encouraging signs in this year’s resolution. “I’ve spoken before pastor groups all over the state,” Grove told other Senators, “and if they don’t counsel from a position of love and compassion and knowledge, then they shouldn’t be counseling people in that area.”

The final vote saw all 29 Democrats vote yes, with seven Republicans voting no, and four Republicans (Senators Shannon Grove (R-Bakersfield), Patricia Bates (R-Laguna Hills), Ling Ling Chang (R-Brea), and Scott Wilk (R-Lancaster) abstaining. As a resolution, ACR 99 does not require a signature from the Governor.

While the final result on ACR 99 was deeply disappointing, there are signs of hope. Stay tuned for several key updates on the next steps and our strategy moving forward.

Free speech concerns for church pastors after California lawmakers pass pro-LGBT resolution

https://christiantoday.com/article/free-speech-concerns-for-church-pastors-after-california-lawmakers-pass-pro-lgbt-resolution/133246.htm

A resolution passed by the California Legislature has led to fears over the free speech rights of church pastors
and other religious leaders when it comes to LGBT issues.

Californian lawmakers last week approved Assembly Concurrent Resolution 99 by 61 votes to 11.

The resolution suggests that religious and pro-conversion therapy groups contribute to high rates of suicide and mental health problems within the LGBT community.

“The stigma associated with being LGBTQ often created by groups in society, including therapists and religious groups, has caused disproportionately high rates of suicide, attempted suicide, depression, rejection, and isolation amongst LGBTQ and questioning individuals,” the resolution reads.

It continues: “The State of California has a compelling interest in protecting the physical and psychological well-being of minors, including LGBTQ youth, and in protecting its minors against exposure to serious harms caused by family rejection and attempts to change sexual orientation or gender identity.

“In a pluralistic society, people differing along spectrums of political and religious perspectives share a common responsibility of protecting the health and well-being of all children and vulnerable communities.”

The resolution makes a specific call to religious leaders to “counsel on LGBTQ matters from a place of love, compassion, and knowledge of the psychological and other harms of conversion therapy”.

Although the demands in the resolution are non-binding, they have given rise to concerns that pastors and other religious leaders will not be able to share a traditional perspective on sexuality from the pulpit or in books.

Senator Andreas Borgeas said during a debate on the resolution that while it did not have the force of law, “we are treading into freedom of speech territory that I think should concern all of us.”

“When an individual seeks therapy or guidance before a religious leader, whether it be a mosque, a temple, or a church, that’s a private setting,” he said.

“To disallow or create the pathway where we tell individuals they can not say certain things should give us pause.”

Senator John Moorlach said that while he did not support all of the “conversion therapy” methods used by counselors, he suggested that people should be allowed to receive professional help if they have unwanted same-sex attraction.

“How can we foreclose on spiritual counselling when someone is on a journey and honestly inquiring about wanting to change and wants professional assistance?” he said.

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MOORLACH UPDATE — OC Register Coverage Look Back — September 16, 2019

25th Anniversary Look Back

On Friday, Sen. Jeff Stone (R – Temecula) had reached his limit on the verbal abuse he received from our colleagues in the majority party (see MOORLACH UPDATE — Last Day of Session — September 15, 2019).

I understand his frustration. The September 9, 1994, article by an OC Register reporter brought me to my own “I’m mad as hell and I’m not taking it anymore” moment (see MOORLACH UPDATE — Governor Signs SB 496 — September 9, 2019).

I wrote a letter to the Publisher of the OC Register, David Threshie, and vented my frustrations. Who does one go to when a reporter is bungling a story so badly? Why was the Register still “not getting it”? The Register had a bus stop billboard campaign showing individuals who were not in the know and claiming that “they didn’t get it,” meaning they were not subscribers.

The letter is provided below, in full, with typos and grammatical errors, probably due to preparing it in haste. (Chris Knap’s name has only one “p.”) I don’t believe it’s ever been published before. It may have been a little more transparent than it needed to be, but it is who I am (even 25 years later).

It refers to the Piper Jaffray debacle. Here is a link to The Wall Street Journal, which had an article on the subject in its archives: https://www.wsj.com/articles/SB975816161975189230. The Bond Buyer story was mentioned in my last UPDATE (see MOORLACH UPDATE — Last Day of Session — September 15, 2019).

The letter would be referred to in journalistic reviews during the weeks after the County’s bankruptcy filing by Susan Paterno (see MOORLACH UPDATE — LOOK BACKS — American Journalism Review — March 1, 2010) and Jim Wood (see MOORLACH UPDATE — LOOK BACKS — February 4, 2010).

For reference, at the time, R. David Threshie was the paper’s publisher and Ken Grubbs was the editor of the Commentary section. Along with Knap and Ricky Young, they left the paper many years and two corporate bankruptcies ago.

 

Mr. R. David Threshie

The Orange County Register

As a recent candidate for Orange County Treasurer-Tax Collector, I wanted to share some of my observations regarding my experience with the press.

Let me preface my concerns by stating that I enjoyed my experience as a candidate, felt that I received a credible percentage of the vote (considering my nominal name recognition), and am happy with the results.

I found the reporters at your competitor, the Los Angeles Times, to be mature, professional, thorough, and balanced. Regretfully, I can not say the same for two of the Register’s reporters, namely Chris Knapp and Ricky Young.

Because the race generated national attention, I had the privilege of conversing with numerous reporters and to read their articles. I have no complaints that would warrant a written communication with any of the other newspapers. I also brought a long history of working with the press as a community activist and as a regular columnist for the Newport Beach/Costa Mesa Daily Pilot. Needless to say, I knew what to expect.

By way of background, I am a Certified Public Accountant and a Certified Financial Planner. I am the administrative partner of the Costa Mesa office of Balser, Horowitz, Frank & Wakeling. I have been with this fifty-seven year old firm for eighteen years, ten as a partner (shareholder). I have served on numerous community and charitable organization boards of directors, many as Chairman. I am involved in my community as I want to see a positive environment for my wife and three young children. I hope that I have been an honorable neighbor and citizen.

In 1992 I decided to run for the Orange County Republican Central Committee in the 70th Assembly District. There were twenty-four candidates running for six seats. I placed sixth and, on the night of my installation, was voted in as Assistant Treasurer. I was also appointed to serve on the California Republican State Central Committee by Congressman Dana Rohrabacher.

Because of my varied political activities, I was recommended as a possible candidate for the Board of Supervisors by William Lobdell, editor of the Daily Pilot, in an opinion piece. Another editor, Steve Marble, also gave a positive recommendation in an editorial encouraging me to run for Costa Mesa City Council. In fact, Mr. Ken Grubbs and I became better acquainted on Mr. Lobdell’s cable access program, and you can inquire with him about my involvements and character.

With encouragement from that election, elected officials, family, clients, friends, and even member of the media, I proceeded to research where I could run for office. I wanted to utilize my natural talents, yet not sacrifice my family. City Council would mean too many evenings away from my children and add some thirty hours per week of additional commitments to my already demanding “business owner” work schedule. Supervisor was not suited to my background and experience (and Jim Silva still teases me about Lobdell’s article). State Assembly would have had me away from home several days a week. The Treasurer’s position would allow me to serve my community, be close to home, and, with a leave of absence from my firm, maintain a regular work week schedule.

After doing extensive research, and conferring with close friends, clients, and politically involved individuals, I decided to run. It would be my opportunity to enjoy our democratic form of government and shed some light on what the incumbent has been doing with our tax dollars.

My approach was simple. Focus on many issues, the foremost being those of anti-incumbency, registered Democrat versus a Republican, the use of leverage, and the strategy of leverage.

I naturally sought the “blessing” of the Chairman of the Orange County Republican Party, Mr. Tom Fuentes, who was hoping to see someone run against Mr. Citron. I worked hard to obtain endorsements from many of our Republican Congressmen, State Senators and Assemblymen, as a support base for a county-wide race.

I worked hard to raise funds. I campaigned. I also wanted to engage Mr. Citron in debates, but he did not oblige. All the same, I requested documents from him under the state’s freedom of information laws and carbon copied those requests with your newspaper.

The Los Angeles Times was the first to do a story. That was followed by the Wall Street Journal. The Register was a “johnny come lately” that bit into everything that Mr. Citron fed them and acted as his mouthpiece throughout. I was pare of some “Republican” plot . . . I controlled and “fueled stories in the financial press” . . . I was a big, bad, barracuda going after a kind hearted man who had earned such high returns for the county. For a paper that believes in term limits, you guys sure out did yourselves in protecting someone running for the seventh four-year term.

I could give you numerous examples of reporter bias, but I’ve already taken up enough space (or inches). I have been biting my lip throughout. I have patiently worked with Mr. Knapp, explaining as politely and professionally as possible the issues as I saw them. During the campaign I did not request a “referee” to review what I said to Mr. Knapp and what was actually used in his articles. In fact, one technical error that he made haunted me for the remainder of the campaign. And even the correction was editorialized in a snide manner.

The article of last Friday, September 9, 1994, entitled “O.C.’s Sky Didn’t Fall,” is the last straw. I can refute this article literally paragraph by paragraph. Again, I’ll spare you the “inches.” “Hatchet job” and “snide” were observations made by friends and associates. Incredulous is what I would call it.

Why would you allow a political reporter who has minimal grasp on business issues to editorialize in the lead article in the Business section? “Well, the campaign is over, interest rates are leveling out”—oh yeah? They went up that very day in a significant way, up to 7.7 percent for the 30-year bond.

“Reports of Bob Citron’s death spiral appear to have been greatly exaggerated.” Oh yeah? But your Sunday Business section included an article entitled, “’Inverse floaters’ help sink the California Muni Fund.” And don’t think that was lost on a large number of your readers. Be consistent. Look at the Piper Jaffray articles. The parallels are remarkable, with one glaring difference: marking to market (another long topic for debate).

“Moorlach . . . was unrepentant in an interview this week . . . “ Give me a break, the issues aren’t going to go away. And should inflation continue to be a factor, possibly continuing the increase in interest rates, the Register will have lost all credibility in future articles on this topic. It’s too bad. We’re talking about a serious chunk of change in taxpayer dollars. The article would have been more aptly entitled “O.C.’s Sky Didn’t Fall, Yet.”

Either Mr. Knapp is trying to protect Mr. Citron, which even Mr. Citron did not seem to want (I’m not interested in creating another controversy.”) Or he still, as your ironic advertising pitch during the campaign months stated, “doesn’t get it.” Or Mr. Knapp can’t seem to leave it alone and has some personal hang ups. He admitted outright to me that what I said was “political” during the campaign even though I insisted throughout that they were “philosophical” differences.

Let me return to “inverse floaters” once more and I’ll close. Citron has purchased some $3.5 billion (nearly one-sixth of the entire portfolio) of this type of derivative. They are now down forty percent in value, or $1.4 billion! Thus my observation that “I was too conservative in my remarks.” Does Mr. Knapp cover this issue in his hit piece? No. Yet many corporate financial officers and county treasurers are being rigorously scrutinized by the media around the country for making this type, or similar types of investment. An example from yesterday’s “Bond Buyer” is enclosed.

I don’t have time any more to talk to a reporter that is on a personal crusade. From here on out, should you need me to comment on this topic again, please have another reporter contact me. I will no longer answer or return Mr. Knapp’s calls.

The Register is precious resource in our county. Your editorial pages are wonderful. But if I want good journalism, I now turn to the Times.

Thank you for allowing mre to address my concerns.

Very truly yours,

John M. W. Moorlach

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MOORLACH UPDATE — Last Day of Session — September 15, 2019

We had a last day of Session on Friday that will not be forgotten anytime soon.

Senator Stone had his fill of being lectured to. I was interrupted a couple of times on supposed points of order during one of my Floor speeches. A protester in the Senate gallery threw blood on several of my colleagues on the Democrat side of the Floor. This caused an immediate lockdown, making the Floor a crime scene, and, eventually, having the final bills of Session heard in the Senate’s largest committee room. The agenda was concluded at just about 3 a.m.

Session would have gone on a little longer were it not for the fact that the Assembly killed a bill that would allow certain bars to stay open until, ironically, 3 a.m.

I flew home Saturday afternoon and enjoyed the Orange County Historical Society’s Centennial 1919 — 2019 Gala Dinner.

Senator Stone Hits His Limit

For all the Trump-bashing that goes on in the Legislature, it is amazing how many Trump detractors end up displaying similar traits they claim to despise. They act like they’re the smartest people in the room and don’t hesitate to admonish colleagues on the other side ofthe aisle. The condescension and arrogance are amazing. The California Globe captures Friday morning’s first dust up in the first piece below.

American Independent Party

Senate Bill 696 enjoyed the gut-and-amend treatment on the Assembly side of the chambers. And the end result was not pretty. If it were not so real, I’d say it would make a great Saturday Night Live skit.

“You registered with the American Independent Party, you silly. That’s a conservative party and you’re not right-wing.”

“Really? Well, maybe they should change their name so uninformed and inept individuals like me who don’t read or do any civics research won’t make that mistake again.”

Instead of using humor, I decided to recount a few of the bills that were recently approved:

“SB 696 is a blatantly oppressive and tyrannical maneuver. But, what’s new about strong arming in this Chamber?

“Colleagues, this Legislature has gone after

“(1) physicians who are trying to protect infants against vaccines they may be severely allergic to;

(2) those who hunt bobcats;

(3) spiritual counselors who are perceived to be addressing the topic of conversion therapy;

(4) the fur industry in California; and

(5) the Gig economy.

“It only makes sense to go after an entire political party.

“This legislature is bold in its bullying. Go bold or go home — I guess.

“The definition of ‘bully:’ ‘seek to harm, intimidate, or coerce (someone perceived as vulnerable).

“You can decimate the AIP’s name because you can. But the optics smack of political bullying.

“And we make laws to stop bullying. Oh, the ironies.”

In doing so, I received a couple of interruptions, requesting me to address the bill and the amendments.

What amendments? There were no stinking amendments. It was a gut-and-amend. Oh, the joys of long days and nights voting on some 800 bills in less than two weeks. Tempers are bound to flare.

What a Friday. The Associated Press provides the details in the second piece below.

iXBRL

I had five bills make it to the Governor’s desk this first year of Session. SB 598 was a recommendation from Marc Joffe and he extolled the bill to The Bond Buyer in the third piece below (see MOORLACH UPDATE — SB 598 Moves On — May 16, 2019). For my 25-year relationship with The Bond Buyer, also see the 25th Anniversary Look Back below.

Medical Marijuana

I did a considerable amount of research while I was a County Supervisor on the issue of Medical Identification Cards. Many parents found that cannabis provided assistance to their children. So, why wouldn’t I support their taking a bona fide prescription while attending school? The Epoch Times covers SB 223 in the fourth piece below. Both Senator Stone and I were coauthors of the bill. I apologize that I was unavailable for the reporter, but it is next to impossible to leave the Floor during the last two weeks of Session.

Satisfied Constituent

The Voice of OC provides a surprise editorial submission from a happy constituent. As hard as my staff and I work, it is great to receive a note of appreciation on occasion. It is the fifth and final piece below.

25th Anniversary Look Back

In a unique foretaste of things to come, The Bond Buyer had a small innocuous article in its September 14, 1994 edition, titled “Auditor Examining Ohio County Fund To Ensure Legality of Its Investments” by Karen Pierog.

Cuyahoga County, Ohio is where Cleveland is located. The similarities to the Orange County Investment Pool are eerie. Here are a few selected paragraphs:

John Conley, spokesman for Ohio auditor Thomas Ferguson, said a soon-to-be-released audit of Cuyahoga County will include a review of its Secured Assets Fund Earnings Fund, which has sustained $97 million in losses since the beginning of the year.

Francis Gaul, who oversees the fund as Cuyahoga County’s treasurer . . . said the paper losses representing about 8% of the SAFE Fund were due to the bear market in fixed-income securities. Still, the fund is offering governments a return of 6.6% on their investments, according to Tim Simmerly, the fund’s chief investment officer. He said the fund has been able to make money through investment techniques such as repurchase agreements with dealers and through the arbitrage of proceeds from a taxable note issue sold last year by the county.

Critics of the fund have expressed concern that the county, whose funds make up 35% to 40% of the money invested in the SAFE Fund, could be exposed to large losses if the market continues its slide and other local governments decide to pull out of the fund.

A few weeks later, SAFE would implode. It made national news. I again tried to warn people in Orange County about the fate that lies ahead.

Where Orange County differed is that the reporters in the Cleveland area started doing some serious snooping around to see if there really was a problem. Their work gave them a major dilemma. If they revealed the facts that they had obtained and verified, it would probably cost Cuyahoga County $125 million if SAFE were to be liquidated. The reporters and their editor had to answer one simple question: Do we print the truth? They decided to print. SAFE would be the largest investment pool loss in U.S. history and their record held for about two months.

I was so impressed with the work of Joel Rutchick and Timothy Heider of the Cleveland Plain Dealer, I even paid them a personal visit a few years later while traveling through Ohio. They did what the Orange County market reporters failed to do. And, the journalism industry noticed (see MOORLACH UPDATE — OC METRO — March 1, 2010).

For my last LOOK BACK, see MOORLACH UPDATE — Governor Signs SB 496 — September 9, 2019.

Republican Sen. Jeff Stone: Mad as Hell and Not Going to be Lectured Anymore by Democrat Colleague

California Senate’s dust up on last day of session

By Katy Grimes

https://californiaglobe.com/section-2/republican-sen-jeff-stone-mad-as-hell-and-not-going-to-be-lectured-anymore-by-democrat-colleague/

During debate in the California Senate Friday, Republican Sen. Jeff Stone had enough, and called out a colleague. Senators were debating AB 1290, a bill to require contractors for the Pure Water San Diego program to enter into a project labor agreement as a condition of receiving specified state funds, despite that San Diego voters already decided to prohibit requiring PLAs as part of construction projects in Proposition A in 2012.

Sen. Toni Atkins (D-San Diego) introduced the bill by Assemblyman Todd Gloria (D-San Diego) as necessary “at a time of climate change and cycles of droughts which threaten water supply.” Atkins explained Proposition A prevents the City of San Diego from mandating project labor agreements on construction projects except when required by state or federal law. AB 1290 would remedy the legal dispute of the Pure Water program, as a condition of receiving state funds. According to the City of San Diego’s court filings, costs are projected to increase $4 million for each month of delay beyond August 2019. Additionally, without legal certainty, the City could lose $646.6 million from the State Water Resources Control Board and could receive significant fines if it does not meet key milestones set by regulators.

“AB 1290 is sponsored by the union caucus,” said Sen. Stone. “It will force the city into a project labor agreement in order to finalize this water project.”

Stone said “I’m curious about why we are stopping water from being delivered to our second largest city in the state.” Stone said the Pure Water San Diego Program has run into legal challenges centered around the San Diego City Council’s November 2018 decision to require contractors to use union apprentices on major parts of the Program.

“You know who unions are – they control this Legislature,” Stone said. “How many bills are we going to see by the union caucus? Big labor lost in San Diego when they lost Proposition A. You are thwarting the will of the voters in San Diego.”

“If you are really a believer in local control… if it passes, it shows this body is really at the will of union bosses,” Stone said, ending his floor debate.

Sen. John Moorlach (R-Costa Mesa) noted that project labor agreements do not have a positive record, and only 10 percent of building contractors in San Diego are union shops. “Why shut out 90 percent? Especially when voters did not approve project labor agreements. This is an end-run by special interest groups taking advantage of this body.”

Next, like a scene out of “Mean Girls,” Sen. Holly Mitchell (D-Los Angeles) refuted Stone’s comments and said, “actually Senator Stone yesterday said how much he enjoyed the debate yesterday,” saying today he’s “uncivil and name-calling.” She said Sen. Stone’s comments “lack civility.”

And that’s when Sen. Stone began a “I’m mad as hell and I’m not going to take it anymore” retort.

“I’ve been tame in my comments this last year,” he said, noting “two to three members of this Legislature talking to me like I’m one of their kids.” He said he’s been called ‘racist’ in addition to being accused of incivility when he debates opposition points of view. “I’m not going to put up with it anymore,” Stone said. He added that only his Jewish mother and a few college professors had ever spoken to him this way.

Senate President Steven Bradford (D-Los Angeles) continued to demand order, but directed his comments at Sen. Stone, and not at Sen. Mitchell.

Sen. Republican Leader Shannon Grove (R-Bakersfield) called for a Republican caucus recess, as Sen. Stone continued to say he would not put up with the condescending treatment any longer.

As the Senate was recessed for the caucus break, Sen. Holly Mitchell walked across the Senate floor over to Sen. Stone’s desk to speak to him again.

This was not taken well.

The Senate was recessed while Republicans caucused privately.

When they returned, Senator Grove invoked a point of personal privilege as the Republican Leader: “The decorum in this house gets thrown out of whack by mainly one group, one person,” she said gesturing to several Democrats. “And my colleagues are done. And I’m here to tell you that decency and respect goes both ways. And when they have points on a bill that are valid, and that are not out of order, for you to bully them into a place of… with your rolling eyes, your smirk smiles, your hostile looks to my members, it is unacceptable. For you to come on this side of the floor and come over to the desk of one of my members when the Chair or President is calling the House back to order is unacceptable. And I am asking you personally, to refrain from your conduct.”

She was halted by Bradford who said, “We’re asking everyone to have decorum today. So let’s not single out any individuals.”

“With all due respect Mr. President, I think it’s just one individual that is causing that conflict on this floor,” Sen Grove said.

“No calling out individual members Senator Grove,” Bradford said.

“I didn’t name a person. I did the same thing that she does to us when she looks across the floor…” Grove said.

“Senator Grove, we’re going to ask you to refrain from those…” Bradford said.

“Okay, again I would just like to call decorum in this house and I would like the bullying to stop,” Grove said. “Thank you.”

Someone in the background clapped.

The Dynamic and Power Structure

Sen. Holly Mitchell, first elected to the State Assembly in 2010, is a prominent member of the African American caucus, and is also the very powerful Senate Budget Committee chairwoman, who is seen by many as lording her position over a Jewish Republican in the minority party. This isn’t the first time this session, this year, or since Stone was first elected to the Senate he was called names, or was on the receiving end of the behavior Sen. Grove described. Yet no one in the Democratic caucus has corrected the behavior on the record, or defended Stone.

Stone was elected to the Senate in 2014. Notably, Stone resigned his membership in the Legislative Jewish Caucus in 2017. “When I was invited to join the Jewish Caucus, I was expressly told that it was a non-partisan Caucus, and the issues we were going to be involved with would focus on promoting the interests of the Jewish people in California and around the world,” Stone said. “Since the election of President Trump, it seems that there has been a divergence from the Caucus’ original mission. It has clearly become a vehicle for a Legislative Caucus that receives state resources to merely criticize our duly elected President.” Senator Stone was the sole Republican member of the Legislative Jewish Caucus.

Despite additional objections to requiring project labor agreements for the Pure Water San Diego program, AB 1290 passed 28-9.

California could ban ‘misleading’ political party names

A staunchly conservative political party in California could have to change its name because some state lawmakers say it confuses voters into believing they are registering to vote as an independent

WRITTEN BY BY ADAM BEAM, ASSOCIATED PRESS


https://www.readingeagle.com/ap/article/california-could-ban-misleading-political-party-names

SACRAMENTO, Calif. (AP) — A staunchly conservative political party in California could have to change its name because some state lawmakers say it confuses voters into believing they are registering to vote as an independent.

The state Senate voted 29-11 on Friday to ban political parties from using “no party preference,” ”decline to state” or “independent” in their official names. Democratic Gov. Gavin Newsom has 30 days to review the bill and either sign it into law, veto it or let it become law without his signature.

The bill would apply to all political parties, but it is aimed at the American Independent Party. The party has been an option for California voters since 1968. Its members make up 2.59% of the state’s registered voters, making it the third-largest political party behind Democrats at 43% and Republicans at 23%.

But critics say the party’s membership is inflated because its name confuses voters into believing they are registering as independent or “no party preference.” In 2016, the Los Angeles Times surveyed the party’s registered members and found a majority did not know they had registered to vote with the party. Statewide, “no party preference” voters account for 28.6% of registered voters.

Representatives of the American Independent Party did not respond to an email seeking comment. According to its website, the party nominated Donald Trump for president in 2016 and “God willing, 2020.”

Democratic state Sen. Tom Umberg, the author of the bill, said voters who mistakenly register with the American Independent Party can’t vote in the state’s Democratic presidential primary next year.

“It goes to our interest, our collective interest, that voters are not misled,” Umberg said. “They can’t confuse voters by choosing a name that many people associate with being independent when in fact they are not.”

Republican Sen. John Moorlach opposed the bill, saying “the optics smack of political bullying.”

“The American Independent Party has been around longer than many of us have been alive,” Moorlach said. “I think it’s a shame.”

The law would take effect immediately if the governor signs it. It would require political parties to change their name by Oct. 29 or be disqualified.

Bill requiring issuers to use XBRL clears California Legislature

By Keeley Webster

More in XBRL, Municipal disclosure, Data transparency, State of California, California The California Legislature has approved a bill that would require its governments and agencies to provide financial documents to the State Controller’s Office in a more readily searchable format than the PDF.

State Sen. John Moorlach, R-Costa Mesa, sponsored Senate Bill 598, the Open Financial Statement Act, with the aim of making state and local government financial data more accessible

“I am pleased that California legislators are supporting the modernization of municipal market continuing disclosure,” said Marc Joffe of the Reason Foundation.

The bill would require that the state, counties, cities, school districts, special districts and pension funds submit financial statements in Extensible Business Reporting Language. The machine-readable computer language, known as XBRL, would standardize issuers’ financial documents making it easier to compare data, because computers could read and search the financial documents, which would also add transparency, said Marc Joffe, a proponent of XRBL, and a senior policy analyst at the Reason Foundation.

The bill did not receive a single nay vote in either house and no one filed a statement of opposition, Joffe said. It cleared its final vote Wednesday.

“I am pleased that California legislators are supporting the modernization of municipal market continuing disclosure,” Joffe said.

The concept, contemplated on the federal level, has received mixed reviews from municipal market participants, some of whom say the changeover would be onerous and costly.

XBRL is an open international standard for digital business reporting managed by XBRL International, a global non-profit consortium of 450 major companies, organizations and government agencies, according to the Financial Accounting Standards Board website. It is an open standard, provided free of license fees, and is already being used in some countries.

XBRL technology has been around for about 15 years and the SEC has been requiring private companies to use it for about 10 years with the EDGAR system. The SEC has the authority to establish a set of standards on the corporate side, but not in the municipal market.

Matt Fabian, partner at Municipal Markets Analytics, has argued that the cost and difficulty of implementing a new standard could result in worse disclosure among small governments and small issuers.

“The CA bill shouldn’t be a problem for the market, which is unlikely to use any CA-specific data in a meaningful, yield-reducing way,” Fabian said. “To the extent a state wants to require all local governments to raise their financial reporting costs, that’s their business. The problem comes with proposals that lay XBRL mandates only on bond issuers and so reduce the efficiency of the municipal market, send borrowers away from the market, and add little to the credit analysis of investors buying more than one state or sector.”

Fabian called the bill a limitation of the idea, because in putting only the finances of California issuers into XBRL, it will be California-only buyers who could make meaningful use of the information

“So it’s very hard to expect that California issuers will see enough of a related reduction in their cost of capital to offset their cost of XBRL,” he said. “But if California wants to force them anyway, maybe the state or its agencies can use the data for monitoring or regulatory programs away from the municipal bond market, that’s up to California.”

Joffe thinks it will lower costs for issuers in the long run.

“Over the long term technical standards like XBRL will save state and local governments time and money because they will be able to satisfy multiple disclosure obligations simultaneously,” he said. “Over 1500 California government entities are required to produce both CAFRs and state financial reports with overlapping information: these should be handled through a single software tool.”

Just as individuals can use Turbo Tax to file both their federal and California tax returns, local governments should expect a similar level of convenience, Joffe said.

Bill Allowing K-12 Administration of Medicinal Cannabis at California Governor’s Desk

BY IAN HENDERSON

https://www.theepochtimes.com/bill-allowing-k-12-administration-of-medicinal-cannabis-at-california-governors-desk_3076641.html

A bill legalizing the ability for medicinal cannabis to be administered to children on K-12 campuses by parents was presented to the California governor on Sept. 6.

Current law prohibits marijuana in any form to be within 1,000 feet of school campuses. Proponents of the bill say this restriction endangers children who rely on medicinal cannabis, such as those who use the drug to control seizures. Opponents of the bill question whether the restrictions on medical cannabis for minors are tough enough, while expressing concern about allowing the drug on campuses.

The bill, SB-223, received support and opposition from both major parties. It was introduced by Senator Jerry Hill (D-San Mateo) and co-authored by Senators John Moorlach (R-Costa Mesa), Jeff Stone (R-Temecula), and Scott Wiener (D-San Francisco), Assembly Members Rob Bonta (D-Alameda), Monique Limon (D-Santa Barbara), Bill Quirk (D-Hayward), and Christy Smith (D-Santa Clarita).

The text of the bill reads: “This bill would enact Jojo’s Act, which would authorize the governing board of a school district, a county board of education, or the governing body of a charter school maintaining kindergarten or any of grades 1 to 12, inclusive, to adopt, at a regularly scheduled meeting of the governing board or body, a policy, as provided, that allows a parent or guardian of a pupil to possess and administer medicinal cannabis, as defined, at a schoolsite to the pupil who is a qualified patient entitled to the protections of the Compassionate Use Act of 1996, excluding cannabis, as defined, in a smokeable or vapeable form.”

The Epoch Times attempted to reach out to the bill’s co-author Senator Moorlach (R-Costa Mesa), but he was unavailable for comment.

The bill received 43 votes in favor in the State Assembly, with 22 against, and 14 not voting. In the State Senate, the bill received 28 votes in favor, seven against and five not voting.

One Democrat who expressed vocal opposition was Al Muratsuchi (D-Rolling Hills Estates).

“As a parent, I feel like this is crossing what should be a bright line in keeping marijuana, cannabis products out of our schools,” he told ABC 7.

Assemblyman Jay Obernolte (R-Big Bear Lake) also opposed the bill. He admitted that there were some compelling testimonies from proponents of the bill in committee. However, his concerns over the bill outweighed that of the testimonies.

“Attempting to maintain our schools as drug free zones is a worthwhile goal,” he told The Epoch Times. “[I] think we have to recognize the serious risks of recreational use of marijuana and the serious consequences of allowing more marijuana onto school campuses.”

Obernolte further pointed out the legal liability that school staff face, since the substance is still recognized as a Schedule 1 Drug by the federal Drug Enforcement Agency (DEA).

“Another [topic] that was never talked about enough in the committee presentation was the legal liability that taking an action like this would have to schools in California. We all know [marijuana] is illegal under federal law. If we are forcing a school to allow parents to bring marijuana on campus, what kind of liability are we exposing them to and are we prepared to defend them from the legal consequences of that should there arise a legal problem with the difference between federal and state law?”

The bill is now at Governor Newsom’s desk pending approval. A similar bill was vetoed by former Governor Jerry Brown last year.

OPINION

Lieberman: DMV Headache Solved by State Sen. Moorlach Constituency Casework

By JODI LIEBERMAN September 13, 2019

https://voiceofoc.org/2019/09/lieberman-dmv-headache-solved-by-state-sen-moorlach-constituency-casework/

My first quarter at university I had a seizure.

This was the first time and according to my doctors––the last time.

Having any sort of lapse of consciousness in California requires that one’s license be suspended for 3 months, regardless of one’s Doctor’s recommendations.

This was news I was not prepared for since my ER nurse told me my license would be suspended for about 2 weeks. My doctor informed me that because of this law, I would not be allowed to drive. This presented a huge problem for me, as I had an internship and job in Orange County that I had been commuting to. I could not longer work my job since it required that I have a car. I didn’t want to let this setback deter me from pursuing opportunities so I decided to use my savings to commute to my internship from UCLA to OC which is a 3-hour commute using the subway, trains and Lyft. I happened to have just enough to sustain this for about 3 months, but absolutely no more than that.

Over the next few months I diligently sent the DMV all the questionnaires and documentation that they required exactly on time, so that the entire process could be over as quickly as possible.

The three months ended and I was preparing for my spring quarter, under the assumption that I would be able to drive. However, I received a letter from the DMV stating that now they wanted to re-examine me. And that they wanted to conduct an interview with me. And also that they would not even be able to see me until April 26th. All this after they had already pushed it back because they wanted more paperwork. This all made no sense because I had a perfect record and my doctor did not recommend that I be re-tested. I had jumped through all their hoops and they kept moving the goal post. I needed my license back as soon as possible so I could get my life back together.

I called the DMV asking if it was possible to move up my appointment or take a test at my local DMV. Anything to speed up the process. The response, “no.” I was devastated. I had done everything I could do. I was going to lose everything I had worked for and there was nothing I could do. I felt powerless.

A friend recommended that I reach out to State Senator Moorlach’s office to see if they could do some “constituent casework” to work with the DMV on my behalf. I had never heard of this “constituent casework” before but I called anyway. I briefly explained my conundrum to the woman who answered the phone, who was the exact person who handled cases like mine. She assured me she would start working immediately! She opened a case for me later that day March 28th.

On April 4th I received a call from a woman from Sacramento. She explained that after reviewing my case she was confused. Everything in my file seemed normal and it made no sense for the DMV to give me a date that was so far out or for them to re-test me. She said she would see what she could do and would stay in contact with me. I was expecting, that, if she was going to be able to do anything for me, it would probably end up being an appointment for another two weeks out. My phone rang, displaying the same Sacramento number exactly two hours later, the second I walked out of my Econometrics class. She informed me that effective immediately I could drive again. I was in disbelief. I had my independence back. I could get my life back. I drove home through two hours of bumper to bumper traffic on the 405 that night, and I had never been happier.

The entire process of trying to return to normalcy was more gruesome and exhausting than actually having a seizure in front of an entire college dining hall, busting my mouth open and and then trying to finish finals week. Instead of being able to just focus on my health, I now had the DMV coming in and encroaching on my very livelihood. Then even though I kept doing exactly what they wanted they kept moving the goal post. If I hadn’t contacted Senator Moorlach and his team, who knows how far they would have moved it.

It is for this exact reason that having offices like Senator Moorlach’s are so important. Within five business days, Senator Moorlach and his team was able to cut through over a month’s worth of bureaucracy. A month that did not matter at all to the DMV but meant everything to me. Words can not describe how grateful I am to Senator Moorlach and his team, if it wasn’t for them I wouldn’t be able to attend my internship and I would not be able to work. I had the opportunity to meet Senator Moorlach at a community event later, and he expressed to me how happy he was that his office could help me out and that it was his top priority to help the residents of the 37th District in any way he could. They have done me the biggest service and I will be eternally grateful to them. If anyone else is having a similar problem with a local form of government and lives in the 37th Senate District, reach out to his local office (714) 662-6050. They will be more than glad to help.

Jodi Lieberman is a first year college student at UCLA.

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MOORLACH UPDATE — AB 44 Fur Banning — September 12, 2019

If you want to see how absurd things are getting up here in Sacramento, go no further than AB 44.

Purchasing a fur coat for my wonderful wife is not on the list of affectionate essentials she wants as a surprise, so I doubt I will ever purchase one for her as a gift. Certain fashion trends go in and out of style. Who wears beaver skin top hats, like Charles Dickens’ Scrooge? But, a ban on certain clothing items? Really?

The Desert Sun and the California Globe provide the details of yesterday’s vote in their pieces below.

It amazes me how the other side of the aisle is so concerned about animal cruelty, but will not come to the full aid of infants who may be allergic to certain vaccines or their ingredients (see https://californiaglobe.com/section-2/bill-to-disallow-vaccine-exemptions-passes-sb-714-is-going-to-be-a-mockery-of-democracy/). But, I digress.

And, as a historian who loves reading about mountain men, I wonder how long it will be until the name of the Jedediah Smith Redwoods State Park will be changed. But, once again, I digress.

Landmark legislation could make California the first state to outlaw fur industry

Rebecca Plevin

https://www.desertsun.com/story/news/2019/09/11/landmark-legislation-could-make-california-first-state-outlaw-fur-industry/2277364001/

Landmark legislation that would make California the first to outlaw the fur industry is now on its way to the governor’s desk and is expected to become law.

AB 44, which passed the California Legislature on Wednesday, will ban the sale and manufacture of fur products across the state.

Another bill signed by Gov. Gavin Newsom last week, AB 273, prohibits trapping of animals for their pelts and puts an end to fur licensing in the state. AB 44, sponsored by The Animal Hope and Wellness Foundation and The Humane Society, goes further, affecting fur farmers, producers and those who sell fur products. Similar bans have already been put in place in some California cities, including San Francisco and Los Angeles.

“California is one of the most progressive states in the country and a world leader in animal welfare,” Assemblymember Laura Friedman, a Democrat from Glendale who wrote the legislation, said in a statement. “Given the overwhelming evidence of inhumane practices in the fur industry and the availability of so many different options for warm and fashionable fabrics, we will not continue to be complicit in unnecessary cruelty towards animals solely for the sake of fur.”

Together, the new laws would make California the first state to completely crack down on an industry, which advocates say has been responsible for the abuse of thousands of animals each year.

AB 44 passed the Senate on Tuesday afternoon by a vote of 27-8. It returned to the Assembly on Wednesday for concurrence, where it passed 43-12.

Sen. John Moorlach, a Republican who represents portions of Orange County, said on Tuesday that he opposed the legislation because it “sends a chilling message to our business community.”

“I didn’t come to Sacramento to shut down legitimate businesses or industries,” he said.

Jeanne Akin Hillis, who owns Hillis Furs in California’s Coachella Valley, said approval of the bills would force her to shutter her decades-old business.

“If this passes, I am leaving California,” said Hillis, who said she has designed and created furs for actors like Elizabeth Taylor, as well as governors and presidents. “This is my pride and joy. I’m the best of the best and my people will follow me wherever I go.”

Fur sales have been on the rise in the US in recent years, and demand is booming. The market is valued at over $40 billion, according to The Fur Information Council of America (FICA), a trade organization that opposed the bill, and increasing numbers of clothes and furniture designers use fur products in their work.

California Legislature Passes Bill to Ban Fur Industry, but will Governor Newsom Sign It?

Animal extremists behind California fur ban legislation

By Katy Grimes

https://californiaglobe.com/section-2/california-legislature-passes-bill-to-ban-fur-industry-but-will-governor-newsom-sign-it/

The California Legislature Wednesday passed legislation to outlaw new fur products sold to consumers, including mink, rabbit and coyote, knowing after months of testimony, they are putting many retailers, fur farmers and ranchers out of business. Should Gov. Gavin Newsom sign AB 44, California would be the first state to ban the sale of new fur products.

Sen. Brian Jones (R-Santee) said that after hearing from different cultural groups, what wasn’t acknowledged was the push to ban fur discriminates against Native American and African American communities whose cultures value fur products. “There’s no reason for this bill other than one class of society telling another class of society what they can and cannot wear,” Jones said.

“I didn’t come to Sacramento to shut down legitimate business or industry – the free market does that,” Sen. John Moorlach said.

Sen. Hannah Beth Jackson, who was the Senate representative for AB 44, was caught on a hot mic Tuesday with an uncomfortable comment. During Senate debate, Sen. Brian Jones (R-Santee) told a sweet story of how his hard working class great-grandfather saved up to buy his great grandmother a fur shall, which was one of her prized possessions. Sen. Jackson said, “Have him send her flowers,” into the hot mic.

Sen. Jackson even said “there is no way to humanely source fur,” and called Furmark “a codification of abusive practices.” FurMark is the certification program that provides consumers with the reassurance they need to confidently buy fur. Furmark operates to ensure the highest welfare and environmental standards. It is a guarantee of good animal welfare and improved sustainability of the sector.

Rather than enforcing the many safety laws from violent animal activists who have been arrested for splashing flesh-eating acid and other chemicals on the outside of a San Diego fur store, and gluing the locks and spray-painting anti-fur screeds on the store’s exterior, the Legislature voted to ban the sale of fur.

Assemblywoman Laura Friedman (D-Glendale) called fur a “fashion statement and statement of wealth. There is no need for warmth” from fur, she said in a recent hearing, mentioning the many faux fur products available.

The fur trade ranks as one of America’s oldest, continuously operating industries, with more than 400 years of history. The fur industry in the United States comprises more than 1,000 fur retailers, 100 manufacturers, more than 200 small family farmers, and tens of thousands of trappers, all of whose businesses, jobs and livelihoods depend on the industry. Retail fur sales in California alone exceed $300 million, and is an important source of employment and tax revenues to the State.

For the fur activists who claim to care about animal welfare, fur farming is among the most sustainable forms of animal agriculture. As explained to the California Globe, in the U.S., animals raised on fur farms are typically fed leftover proteins from food processing plants that humans do not eat, thereby diverting 390 million pounds of waste that would otherwise go to landfills. The manure generated by animals raised on fur farms is used as a rich fertilizer on local agricultural crops. The by-products from the animal are used in many ways, e.g., the meat of the animal is used as bait for the crab fishing industry and as a biofuel and the oil from the animal is used in the cosmetics industry or as a leather conditioner. Virtually no part of a farmed fur animal goes to waste. Fur farming is consistent with the policy objectives of California to promote environmentally sound and sustainable agriculture and industry.

In June the Center for Consumer Freedom filed a complaint with the IRS and FBI regarding PETA and two California-based groups called Direct Action Everywhere (DxE) and Animal Hope and Wellness Foundation. “These are radical groups lobbying to dictate lifestyle decisions on Californians–and we believe these organizations have abused the nonprofit tax code,” Will Coggin with The Center for Consumer Freedom explained.

“One of the bill’s sponsors, Animal Hope in Legislation, is run by a fellow named Marc Ching. Ching spent nearly a decade in prison for kidnapping, according to court records,” The Center for Consumer Freedom reports. “Post-prison Ching started an animal rescue organization that was the subject of a shocking exposé for its conduct in Asia. Ching’s operation allegedly left hundreds of dogs to die in the hands of Buddhist sanctuaries that did not believe sick animals should be treated. According to a volunteer who went on the rescue attempt, it was a disaster from the beginning.”

“Harassing people, and breaking into people’s farms isn’t what a charity does,” Coggin said. “Banning fur is an unacceptable use of the government as morality police for special interests.”

Assemblywoman Friedman claimed she had not heard from fur industry retailers, however this is not true. “The first casualty in this legislation was the truth,” Kaplan said.

Fur industry representatives have offered amendments to Friedman four different times, “which she failed to accept or even discuss,” Keith Kaplan, Fur Information Council of America, said.

Teli Spyropoulos, President of BC International Group, Inc., one of the largest fur retailers, sent a letter to Friedman sharing his opposition to her bill, challenging her claim that she has not heard from any retailers:

“Many people (myself included), within our organization have been submitting letters since the bill was originally introduced to Assembly Members, Senators and to each of the committees who have heard AB 44 to date,” Spyropoulos said.

The legislation received strong support from animal rights advocates, including the Humane Society of the United States.

“If you really want to get [new] fur that bad, go to Vegas,” said Marc Ching, founder and president of Animal Hope in Legislation, the animal rights group behind AB 44 and the Los Angeles ban. “We’re residents and we know a lot of people here who are against fur,” the Los Angeles Times reported.

Furriers located in California say their businesses will never survive if AB 44 is signed into law.

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MOORLACH UPDATE — AB 1482 and AB 5 — September 11, 2019

Rent Control

We had two major bills yesterday on pressing issues facing California. Last November, the voters resoundingly defeated Proposition 10, an effort to institute rent control, but the campaign victory came at a very high cost, somewhere above $76 million for the No side. The proponents of rent control announced that they want a rematch for November 2020.

If a form of statewide rent control is on the books, then another ballot measure shouldn’t be necessary, right? Therefore, another $76 million campaign could be avoided. After watching what happened recently in New York State, the parties became proactive, hijacked AB 1482, and focused on a negotiating opportunity with the Governor.

The Sacramento Bee covers some of my Floor remarks in the first piece below. And the LA Daily News and OC Register cover my vote in the second piece.

I will abstain from voting for a bill when there are strong free market arguments on both sides. I disdain rent control. I also disdain expensive coercion by well financed and powerful special interest forces.

Balancing an anathema to rent control with a compromise of 5 percent annual increases (at what may be the top of this recent economic cycle), plus the cost of living, seems like a tolerable approach. Respecting both sides of the debate, I shared my concerns and abstained. At the end of the day, the free market will resolve the housing crisis by population downturns, overbuilding, and/or long-term recessions. It’s a shame that Sacramento makes overbuilding an unachievable possibility.

Dynamex

The San Francisco Chronicle covers the other big statewide debate on determining if one is a common law employee or an independent contractor. The unions proffered AB 5 as a result of the management incompetency of Dynamex.

One of my first published articles some 35 years ago was on this very topic. AB 5 is a sad mess in responding to the Dynamex California State Supreme Court decision.

I defended the transportation network companies (TNCs) by claiming that most drivers were part-timers earning spare income to pay the rent and, therefore, independent contractors. If they wished to transition into full-time taxi drivers, working 8-hour shifts, then they could negotiate the appropriate arrangement with Uber or Lyft. Accordingly, I presented an amendment to delay the implementation of AB 5 for TNCs for one year. It was procedurally “laid on the table” and not voted on.

AB 5 is disappointing legislation that picked winners and losers. It will be extremely detrimental to many industries and fails to provide a framework for determining the boundaries of whether one is an employee or an independent contractor. The business unfriendly climate emanating from Sacramento continues.

CAPITOL ALERT

Capitol Alert

Sheriff oversight bill held + Rent cap moves to Assembly + Governors urge gun control

BY HANNAH WILEY

https://www.sacbee.com/news/politics-government/capitol-alert/article234928542.html

IT’S NOT RENT CONTROL

“(Assembly Bill 1482) is very different,” said Senate President Pro Tem Toni Atkins, D-San Diego, following the vote on a two-for-one bill that would cap rent increases at 5 percent plus inflation and prohibit landlords from throwing out tenants in certain situations.

Atkins’ defense of the bill comes after the Senate passed the measure on a 25-10 vote yesterday. It now heads to the Assembly for final approval before heading to the governor’s desk.

“There is a big distinction in difference,” Atkins continued. “We’ve been very clear what this cap is, how it will be used and when there is a sunset. This is not rent control.”

Republicans speaking against the measure were not so convinced.

“The two words ‘rent control’ to me is like fingernails scratching on a chalkboard,” said state Sen. John Moorlach, R-Costa Mesa.

Moorlach and his conservative colleagues argued during the floor debate that the AB 1482 would add hurdles to housing production in a state already bleeding for more units, and that it would harm landlords who own a few units to rake in a little extra cash.

“If it disincentivizes the production of new housing, we’re toast,” Moorlach continued.

Newsom, however, appears ready with pen poised.

“California is at the doorstep of enacting strong, statewide renter protections – safeguards that are critical to combating our state’s housing and cost-of-living crisis,” Newsom said in a statement following the vote. “I thank the Senate for their decisive action today as the bill moves on to the Assembly.”

California Senate advances AB 1482, a statewide cap on rent hikes

The bill would limit rent hikes on units that are at least 15 years old to 5% plus inflation, up to a maximum of 10% a year.

By JEFF COLLINS

https://www.dailynews.com/2019/09/10/state-senate-advances-statewide-caps-on-rent-hikes/

https://www.ocregister.com/2019/09/10/state-senate-advances-statewide-caps-on-rent-hikes/

California moved closer to enacting statewide rent caps on apartments and some rental houses after the state Senate voted 25-10 on Tuesday, Sept. 10 to pass the so-called “anti-gouging” rent bill.

Assembly Bill 1482 would limit rent increases to 5% a year plus inflation, up to a maximum of 10%.

The Assembly could take the measure up again Wednesday to vote on Senate amendments, with Friday the last day to pass state legislation. Gov. Gavin Newsom’s approval is likely since he was a key player in the compromise that led to the current version of the bill.

The California Apartment Association, which represents large corporate apartment owners, agreed not to oppose the bill during last-minute talks. But amendments adopted in the past 1½ weeks alienated another ally, the California Association of Realtors, which ended up opposing the legislation.

Ten out of 11 Senate Republicans voted against the measure with Orange County Republican John Moorlach abstaining. Four Democrats also abstained.

Senate President Pro-Tem Toni Atkins, D-San Diego, praised Assembly Housing Committee Chair David Chiu for working with various stakeholders “to thread a very, very thin needle” leading to the bill’s survival.

California follows in the footsteps of Oregon, which passed a similar rent cap earlier this year. If AB 1482 passes and is signed into law, Atkins said, “it will be the strongest renter protection law in the country.”

If approved, the measure would affect all apartments in the state that are at least 15 years old. Houses and condos owned by corporations and real estate investment trusts, or REITs, that are 15 years old or older would also be subject to the rent caps.

The measure also provides “just cause eviction” protections for tenants who have lived in their rental for at least a year, meaning a landlord can’t order renters following terms of their lease to move out unless the owner plans to move in, demolish or renovate the unit or stop renting it out.

The law would expire automatically in 2030.

The measure would not affect rent limits in local jurisdictions with existing rent control laws.

Owners who share a home with their tenants or owner-occupied duplexes would be exempt from the caps. Landlords would be allowed to increase rents to market rates after a tenant moves out, with the 5% caps kicking in after a new tenant moves in.

The state Senate debated the measure for more than two hours as the Los Angeles County Board of Supervisors voted to reinstate rent control permanently in unincorporated parts of the county. The L.A. County plan calls for rent to be capped at the rate of inflation, up to a maximum of 8% a year. Lower maximums would be imposed if inflation falls below 3% a year. The county has had a temporary 3% rent cap on apartments at least 24 years old or older for the past year.

In both Sacramento and Los Angeles, rent-cap advocates argued tenant protections are needed to stem the rising tide of homelessness in the state.

“A question that keeps many of our constituents up at night is how will I stay in my home after the next big rent increase,” Atkins said. “And many of these renters are faced with the impossible choice between a roof over their families’ head or paying for basic necessities like food and medicine. Unless you live in one of 15 cities with rent control, there’s absolutely no protection afforded to you if your landlord wants to raise your rent by 50, 100% or kick you out altogether. Those stories are real.”

All it takes is a large, unexpected expense to put regular working people on the brink of homelessness, added Sen. Nancy Skinner, D-Berkeley. “They are now in their cars, or on couches or on the streets,” she said.

Senate Democrats likened the state’s housing crisis to an emergency or natural disaster, saying provisions akin to existing anti-gouging laws that take effect following fires or floods are warranted.

“This housing crisis that we are in should also trigger that kind of cap to protect millions of renters,” Atkins said. “AB 1482 is not rent control.”

Republican lawmakers, however, argued AB 1482 will make the housing crisis worse by discouraging developers from increasing the supply of housing in the state, creating competition between landlords. The measure will devalue rental properties, forcing most developers to invest in other states, while leading to more homelessness and renters leaving the state, argued Sen. Jeff Stone, R-Temecula.

AB 1482 “will enact the most severe rent control measure our state has ever seen,” Stone said, noting the rent caps come as Los Angeles rental property owners are struggling to pay for earthquake retrofitting.

“There are other places they can go and not have their investment hamstrung,” said Stone. “We must pass legislation that encourages housing development. … There’s a right way to do it and a wrong way to do it. Limiting the supply of housing is the wrong way to do it.”

Senate Democrats agreed that increased homebuilding is an essential part of the solution. But that alone is insufficient when tenants are facing displacement because of rent hikes as high as 100-200%. Democrats, and even one Republican, argued that caps at 5% plus inflation should give landlords sufficient leeway to cover their expenses, while the ban on caps for buildings newer than 15 years should provide enough inducement for developers to build new housing.

“Job Number One is keeping people stable in the housing they have right now,” argued Sen. Scott Wiener, a San Francisco Democrat who chairs the Senate Housing Committee. “That’s how we protect them from homelessness. … Renters are getting dramatic rent increases. Doubling and tripling. That is not how you keep people stable in their housing.”

“It’s true,” added Bob Hertzberg, D-Van Nuys, “when they say the rent is too damn high.”

Senate passes AB 5 gig-work bill, which could turn contractors into employees

Carolyn Said and Dustin Gardiner

https://www.sfchronicle.com/business/article/Senate-passes-AB5-gig-work-bill-turning-14430204.php

The California Senate on Tuesday passed gig-work legislation that could transform the state’s employment landscape, turning many independent contractors into employees. The vote was 29-11, along party lines.

The bill now heads to the state Assembly, where lawmakers approved an earlier version but must agree to amendments. If it passes a final vote there, AB 5 goes to the desk of Gov. Gavin Newsom, who wrote a Labor Day op-ed supporting the measure.

Hundreds of thousands of independent contractors, including Uber and Lyft drivers; DoorDash, Uber Eats, Instacart and Postmates couriers; Amazon Flex drivers; taxi drivers; translators; medical professionals; franchise owners and more, could become employees after the law takes effect in 2020. Unions, which pushed passage of AB 5, hope to organize newly minted employees, especially those at gig companies.

State Sen. Maria Elena Durazo, D-Los Angeles, who co-authored the bill, began Tuesday’s debate by blasting tech companies and some traditional employers, saying they have, for decades, exploited workers with false contractor labels.

AB 5 codifies and expands a groundbreaking California Supreme Court decision from last year known as Dynamex, which uses a simple three-part criteria, the ABC test, to determine employment status. It says a worker is an employee if the worker’s tasks are performed under a company’s control; those tasks are central to that company’s business; and the worker does not have an independent enterprise in that trade.

Proponents say that companies call workers independent contractors to avoid paying minimum wage, overtime, workers’ compensation, unemployment insurance and a range of other benefits that can add 30% to labor costs. Misclassification costs California some $8 billion a year because of lost wages, taxes and expenses, as well as subsidizing social safety-net assistance for the workers, said the bill’s author, Assembly member Lorena Gonzalez, D-San Diego.

But opponents, who include both companies and workers, say they value the flexibility of independent contractors. Businesses in several industries, including ride-hailing, gig deliveries, hospitals, newspapers and truck owner-operators, warned that adding the costs of employment could be devastating and result in higher charges to consumers and curtailed service.

On Tuesday evening, Gonzalez announced she had agreed to delay the bill’s implementation by one year for newspaper delivery drivers, following demands in the Senate.

“While I personally disagree with this delay, I’m willing to allow the newspaper industry the additional year to comply if it means those delivery drivers and nearly a million other misclassified workers are provided the minimum wage, benefits and workplace rights of Assembly Bill 5,” Gonzalez said in a statement.

Senators rejected 12 sets of Republican-sponsored amendments, which largely would have added carve-outs for more professions. During a debate that stretched into the night, GOP senators said the bill failed to add clarity to the Dynamex decision.

“It picks winners and losers when it should be providing a framework on how you are determined to be a common-law employee or an independent contractor,” said Sen. John Moorlach, R-Costa Mesa.

A lengthy list of professions won exemptions from AB 5, largely because they typically set their own prices and negotiate directly with their customers. They include doctors, dentists, psychologists, insurance agents, stockbrokers, lawyers, accountants, engineers, direct sellers, real estate agents, hairstylists, commercial fishermen, travel agents and graphic designers.

Uber, Lyft and other gig companies negotiated unsuccessfully to be exempted. They now plan to take their case directly to voters with a ballot initiative in November 2020 seeking to create a new category of workers who would be independent but could receive some benefits and a guaranteed wage floor. Uber, Lyft and DoorDash have ponied up $90 million to support the measure.

Carolyn Said and Dustin Gardiner are San Francisco Chronicle staff writers. Email: csaid, dustin.gardiner Twitter: @csaid, @dustingardiner

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