Posted on March 6th, 2008 — in Economy and Business :: Growth, Development & Infrastructure
A recent fact sheet from the Public Policy Institute of California points out that housing prices in California have taken the steppest plunge in 25 years, which was about the time the country was in the midst of its last major recession (not counting the recessions of 1990-1991 and 2000-2001, which were shallower and briefer than this recession is expected by many observers to be). Between the fourth quarter of 2006 and the fourth quarter of 2007, housing prices fell by 6.6% in California, whereas two years ago, housing prices were still rising by 21%. Nationally during the same quarters, housing prices nationwide rose by 0.8%. In addition, foreclosures in California were at 1.9% in 2007, well above the national average of 1%. As often occurs in economic downturns, the interior regions of the state were hit harder than the coastal regions. In the San Francisco metropolitan region, home prices fell by only 0.9.%; in Los Angeles, Santa Cruz, and San Jose, home prices fell by less than 4%. However, in Merced, Modesto and Stockton, home prices fell by 15% — the largest one-year decline in any California metropolitan region in at least 30 years. Construction permits also took huge dives in some interior regions, with declines between 2004 and 2007 of 60% in Riverside-San Bernardino, 63% in Modesto, 73% in Stockton, and 76% in Merced.
Posted on February 15th, 2008 — in Ballot Measures :: Economy and Business :: Elections and Voting :: Growth, Development & Infrastructure
The California Property Owners and Farmland Protection Act, which has qualified as Proposition 98 on the June 3 ballot, defines rent control as a form of eminent domain and if enacted would provide that any rent control ordinance in effect prior to January 2007 become essentially invalid. Most of the cash thus far for the initiative has come from landlord and property owners’ groups and the Howard Jarvis Taxpayers Association. Two groups that have signed on to oppose Proposition 98 are the AARP and the League of Women Voters.
There are currently 12 California cities with rent control ordinances, including several of the state’s largest urban centers: San Francisco, Oakland, Los Angeles, San Jose, Beverly Hills, Santa Monica, West Hollywood, Palm Springs, Los Gatos, Hayward, East Palo Alto, and Berkeley. (Thousand Oaks also had a rent control ordinance in effect but has gradually phased it out.)
Because California enacted vacancy decontrol measures in 1995, in communities with rent control, rental units have shown a huge discrepancy in price between vacated units, which landlords have been able to re-price beyond the standard allowable annual rent increase, and units with tenants who have remained put. Expect the number of vacated units (whether they are vacated voluntarily or involuntarily) in those communities to drastically rise if Proposition 98 becomes law.
Posted on January 28th, 2008 — in Economy and Business :: Growth, Development & Infrastructure
A recent report prepared for the California Business, Transportation, and Housing Agency points out that California is the only state in the nation without a formal international trade and investment development program. (The state used to have such a program, run from the Technology, Trade, and Commerce Agency, but that agency was disbanded by the legislature in 2003.)
The report mentions other states with significant international trade budgets, including Pennsylvania, which has a $20.7 million budget set aside for this purpose, and the report explores the implications of California, which has the eighth-largest economy in the world if it were an independent nation, failing to fund such a program, including loss of competitive advantage.
Posted on January 22nd, 2008 — in Ballot Measures :: Campaign Finance :: Elections and Voting :: Growth, Development & Infrastructure
As of January 18, money spent on the four Indian casino compact initiatives (Propositions 94-97) has shot over the $100 million mark, making the gambling initative battle the costliest in state history, according to an article from the Copley News Service. (The total is not all that surprising when you consider the flood of TV ads in support of and in opposition to the measures that have hit state airwaves in the past month.)
The four tribes advocating the ballot measures have collectively spent an estimated $82.7 million. The opposition to the measures, which comes largely from two other casino-operating tribes (the Pala Band of Mission Indians and the United Auburn Indian Community), a casino workers union, and the owners of the Hollywood Park and Bay Meadows race tracks, have spent an estimated $25.9 million.
See the IGS Library’s informative web resources covering the gaming initiatives here.
Posted on December 31st, 2007 — in Growth, Development & Infrastructure :: Resources and Environment :: State Disasters and Emergencies
The final report of the governor’s Delta Vision Blue Ribbon Task Force was recently released. It recommends several immediate measures to protect the Delta and the Suisun Marsh areas and to prepare for potential natural disasters involving those areas. Some of the significant recommendations:
- The state should protect critical areas from further development by acquiring title or easements to floodplains and taking other action to actively discourage further development on “land that could provide flood protection.”
- The state should set appropriate standards for levee improvements and use available bond funds “to address strategic levee and floodplain improvements.”
- “State government should embark upon a comprehensive series of emergency management and preparation actions within a few months.”
The report warns, “A two-in-three chance of a major earthquake within the next few years in or near the Delta make its levees vulnerable to sudden collapse. In addition, increased urbanization poses an imminent threat to the Delta by placing more residents and their property in a floodplain.”
The full report is available here.
Posted on December 21st, 2007 — in Growth, Development & Infrastructure :: Health Care :: Polls and Surveys
According to a recent Field Poll, Californians back the health reform package supported by Governor Schwarzenegger and Assembly Speaker Núñez (known as AB1X 1) by a margin of 64-23%. A somewhat narrower majority (63-33%) supports the idea of a 2% cigarette tax to pay for the reforms. As the director of the Field Poll, Mark DiCamillo, was quoted as saying in a San Francisco Chronicle article, “This is very significant support. There’s a lot of combinations of ideas that would not be palatable with the public — but this is one that the public is cheering on.”Media reports have noted that significant questions remain about the financing of the reform package and its legality under federal law, since a major component of the package involves mandatory employer contributions.
The Assembly approved the health reform package on Monday (without approving the approximately $14.4 billion that it will take to finance the reforms if they are fully implemented). However, State Senator Don Perata (D-Oakland) has issued a statement indicating that he will not be in favor of the Senate taking up consideration of AB1X 1 until the Legislative Analyst’s Office completes a fiscal analysis of the proposal’s possible impact on the state budget.
See our summary of the main points of AB1X 1 and other recent health care reform proposals here.
Update: The Governor and the Assembly Speaker on December 24 formally filed the health care reform package as an initiative for the November 2008 ballot. See details here.
Posted on December 17th, 2007 — in Economy and Business :: Growth, Development & Infrastructure :: State of the State
According to data released by the economic research and forecasting firm Global Insight last week, five of the 20 top overvalued housing markets are in California. 63% of housing markets nationwide are overvalued, according to the data.
The five housing markets in California that fell in the top 20 were (along with cost of an average house in the third quarter of 2007):
- Madera ($291,600; overvaluation 62.3%)
- Merced ($248,300; overvaluation 56.6%)
- Riverside-San Bernardino ($329,600; overvaluation 44.6%)
- Bakersfield ($219,300; overvaluation 42%)
- Los Angeles ($512,900; overvaluation 42%)
Posted on September 20th, 2007 — in Growth, Development & Infrastructure :: Transportation
Some of the worst-congested roadways in the United States are in Calfornia, according to a new report from the Texas Transportation Institute. This will come as no surprise to anyone who has to commute in the Bay Area or Southern California. In the Los Angeles metropolitan area, for example, the ratio of travel time in peak hours to free-flow traffic time is 1.92, which means that it takes an average of almost twice as long to drive somewhere in high-traffic situations as in traffic-free conditions.
What causes the congestion? The report points to several factors. For one thing, 70% of the gross domestic product and 69% of the jobs in the US are in the 100 largest metropolitan regions. That amounts to a lot of people and freight moving through consticted areas at the same time. Another factor: the supply of public transit and roadways, even though it has increased over the past 20 years, has not kept pace with the growth in population.
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Posted on July 19th, 2007 — in Demographics :: Growth, Development & Infrastructure
Although California is well ahead of the rest of the country, there are significant gaps in broadband availability and adoption in the state, according to a recent report from the Public Policy Institute of California. Unsurprisingly, the availability and adoption of broadband is higher in areas with higher incomes and higher population densities.
Nationally, 39% of households had access to broadband at the end of 2005, which is up from 7% at the end of 2000. The comparable figures for California: 10% at the end of 2000 and 47% at the end of 2005. Possible explanations for the higher rates of broadband availability and adotpion in California include (a) more “favorable demographics” (comparatively higher incomes, more education); (b) more profit in offering broadband because of the higher population density and generally higher incomes in the state; and (c) state policies favoring wider deployment of broadband services.
Factors that feed into the gap in broadband availability and adoption include (a) neighborhood income, (b) the presence of personal computers in the household, (c) ethnicity (Hispanics and African-Americans are less likely than whites and Asians to have broadband), and (d) regional differences (the Central Valley and areas of Northern California north of the Sacramento Valley are far less likely to have broadband than coastal counties and the Inland Empire).
Posted on July 6th, 2007 — in Education :: Growth, Development & Infrastructure :: Tribal Gaming
A recent report from the California Budget Project dissects the governor’s proposal to privatize the state lottery and finds it wanting in several respects. According to the report, the proposal overestimates the amount of money that the state would likely get from privatization (in the range of $13-18 billion rather than the $37 billion claimed by the governor’s office).
Privatization would also likely conflict with existing or pending tribal gaming compacts. It would also more likely than not wind up enticing low-income Californians, who already buy the bulk of lottery tickets, to spend more money on the lottery.