2013-14 Legislative Session: Missed Opportunity

Governor Jerry Brown keeps declaring the “California Comeback.”  Whether I talk to small business owners, students or seniors, no one else shares that view.

Reflecting on the just concluded two-year legislative session, I have to say that Sacramento once again missed an opportunity to greatly improve the lives of Californians.

Sacramento did take some actions to improve the economic climate.  Among them were the passage of the Film Tax Credit and the Aerospace Tax Credit.

AB 1839, the Film Tax Credit, offers incentives for film and television productions to stay in California. As a principle co-author, my colleagues and I were able to reach an agreement that triples funding. This is a jobs bill that is good for the Santa Clarita Valley and indeed, good for all California.

Runaway film production is not only about jobs, but keeping families together.  Too many families have to be apart as TV shows and films have migrated out of California. This new incentive package, I believe, will lead to more jobs staying in California.

Thanks to AB 2389, California will be able to compete for the next long-range bomber, a $55 billion federal contract.  Winning the contact will lead to about 6,500 jobs in the Antelope Valley area, but will lead to additional business for many of the defense sub-contractors who reside in our valley. Senator Steve Knight was a leader on this issue and needs to be commended for his efforts.

Having said that, the Legislature never addressed tort reform, workers compensation reform, or made an effort of lessening the burden of over-regulation.  We will not be able to grow California's economy until we create a stable regulatory and tax climate so entrepreneurs have the confidence to once again invest in our state.

California has been in drought conditions for the last three years, but we are in a government-induced drought due to inaction on the part of Sacramento.

The Legislature passed a $7.5 billion Water Bond which shaves $4 billion of pork from the original proposal.  Most importantly, the proposal dedicates nearly $3 billion toward storage and water conveyance.  Santa Clarita Valley receives about 50% of its water from the State Water Project and this on-going appropriation will ensure the state will be able to store and then deliver the water that is promised to Southern California residents.

And finally, earlier this year a bi-partisan compromise was reached on creating a real Rainy Day Fund. This measure will hold in reserve 1.5% of annual revenues into a separate account. A portion can be used to pay down the state's “wall of debt” and the remaining funds will be held in reserve until the next economic downtown.  This is how California families budget, and I'm pleased we are bringing this budget reform to Sacramento.

While there were some positive actions taken, we didn't do enough to protect taxpayers' wallets, invest in education or roads.  The “Hidden Gas Tax” is a perfect example.

In 2006, the Legislature passed AB 32 the so-called Global Warming Solutions Act.  This measured handed immense power to the non-elected California Air Resources Board (CARB).  CARB sets regulations and taxes on California business with the purpose of reducing greenhouse gases (GHG).  I'm all for reducing GHGs, but these decisions need to be made by the elected representatives in the Legislature, not un-elected bureaucrats.

Beginning on January 1, 2015, CARB will expand its cap-and-trade program to include gasoline and diesel.  This hidden gas tax will add 5 to 19 cents per gallon. Two measures were introduced to delay or repeal the “hidden gas tax” (I coauthored the repeal version) but both were killed in committee. I am all for clean water, clean air, and doing what we can for climate change, but not at the expense of our economy and not with a regressive tax. At this point only Governor Brown can stop CARB from enforcing this tax.

For California to prosper long-term we need investment by the private sector to create more jobs.  That will not happen as long as our taxes are too high, regulatory burden too great and infrastructure (roads and water) deficient in meeting the needs of commerce and residents. 

While the Legislature took some positive action this session, we need to do more.