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Thursday, February 2, 2023   WECA Political Update February 2, 2023

‘Recession Is Underway’ For Home Builders Construction Dive has concluded the recession is here. The housing industry downturn is poised to push the U.S. economy into a mild recession this year, according to the National Association of Home Builders’ chief economist. Elevated inflation and mortgage rates coupled with the high building material and construction costs that have plagued the industry since the start of the COVID-19 pandemic continue to take a toll on residential contractors, Rob Dietz said at a press briefing at the International Builders’ Show in Las Vegas. 2022 was the first time in 11 years that single-family starts declined, falling an estimated 12% to 999,000 units, the NAHB reported. “Our thesis is that recession is underway,” Dietz said. Story

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Republican U.S. House Candidates Outperformed 2020’s Presidential Results In 327 Districts Last Year Republicans in 327 congressional districts last year outperformed Donald Trump’s (R) 2020 vote totals in those same district boundaries. Democratic House candidates, meanwhile, outperformed Joe Biden in 68 districts (16%). Florida’s 26th Congressional District saw the largest swing towards the same party. Incumbent Mario Diaz-Balart (R) improved on Trump’s margin of victory in the district by 23.5 percentage points. Alaska’s at-large congressional district saw the largest swing in a district that changed party control. Incumbent Mary Peltola (D) won the state by 10 percentage points in 2022 after Trump won the state by 10.1 percentage points in 2020, resulting in a 20.1 percentage point swing toward Democrats. In two districts, the margins of victory in the 2020 presidential election and 2022 midterms matched: Texas’ 9th and Texas’ 35th.

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A New Pacific Legal Foundation Documentary, Trust Us, Reveals the Government’s ‘Expert’ Problem For nearly every aspect of American life—the food you eat, the house you live in, the way you raise your kids—there is an expert in the federal government who thinks you’re doing it wrong. In Trust Us, a new documentary from Pacific Legal Foundation, you’ll see how the U.S. federal government has funneled power to unelected experts who believe they can engineer solutions to all the country’s problems, with often-disastrous results for the American people. Trust Us is now available to watch for free on YouTube, Tubi, and commercial-free on Amazon.

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Arizona Republican Leaders Don’t Want Gov. Hobbs To Use Her Leftover Inaugural Fund for Democrats The top two Arizona Republican lawmakers want Gov. Katie Hobbs to put money left over from the inaugural celebration into a state account--where it can’t be used to elect more Democrats. In a hand-delivered letter Thursday, House Speaker Ben Toma and Senate President Warren Petersen called on her to surrender control of what’s left from the more than $1.5 million Capitol Media Services first reported she collected for the Jan. 5 celebration. At the same time, the costs listed totaled only about $207,000. Story

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Are Public Employee Unions Unconstitutional? A Commentary by Michael Barone. “How did it come to pass that public employee unions, which scarcely existed 60 years ago, have come to run public schools and myriad state and local government agencies? Answers to this question, which few people think about these days, come from Philip K. Howard’s latest book, “Not Accountable,” accompanied as in his earlier books (“The Rule of Nobody,” “Try Common Sense”) by outspoken outrage and generous dollops of common sense. The rise of public employee unions in the 1960s was not inevitable. President Franklin Roosevelt, who wanted his New Deal programs to deliver results, explained that “The process of collective bargaining, as usually understood, cannot be transplanted into the public service.” That was in 1937, when New Deal legislation sparked the drives that vastly increased private-sector unionization. In 1955, when private-sector unionization percentages peaked, AFL-CIO President George Meany opined confidently that it was “impossible to bargain collectively with the government.” More

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What is the Debt Ceiling? The U.S. federal government has reached the limit on the amount of debt it is legally allowed to accrue. Congress sets this amount, known as the debt limit, and has the power to raise it to meet the country’s financial obligations. Once the debt limit is reached, the Treasury Department has a limited number of tools, called extraordinary measures, that allow the Treasury to keep paying the government’s bills. The debt limit is the total amount of money the U.S. federal government is authorized to borrow to meet its existing financial obligations, including Social Security and Medicare benefits, salaries of members of the military, interest on the national debt, tax refunds, and other payments. It is impossible to overstate the negative consequences that would occur if the United States were to default on its debt. Click here to learn more.

By the Numbers:

$31.381 trillion: The current federal debt limit, which was last raised in December of 2021.

102: The number of times the U.S. government has increased the debt limit since World War II.

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2024 California Elections Democratic state senator and longtime appropriations chair Anthony Portantino officially announced his bid for CA-30 on Monday, hoping to beat out other ambitious LA-based Democrats for Rep. Adam Schiff’s seat. His challengers may include Assemblymember Laura Friedman, Los Angeles Unified School District board member Nick Melvoin, actor Ben Savage, and activist and 2022 challenger Maebe A. Girl.

In related news, Rep. Katie Porter will hold a fundraiser in Silicon Valley next month for her newly launched Senate bid, making her the latest critic of tech giants to make the pilgrimage to their cash-flush backyards. Porter will headline a fundraiser at the Palo Alto home of Sarah Sands, whose husband is venture capitalist Greg Sands. Like a fundraiser hosted by Sands for Sen. Amy Klobuchar (D-MN) earlier this month, the event was organized by the Bay Area fundraising group Electing Women Bay Area, according to the invite. The suggested contribution amount is $1,000.

And finally, Rep. Nancy Pelosi on Thursday endorsed Rep. Adam Schiff for the Senate primary, backing the former House Intelligence Committee chair only on the condition that Sen. Dianne Feinstein opts not to run again. “If Senator Feinstein decides to seek re-election, she has my whole-hearted support. If she decides not to run, I will be supporting House Intelligence Committee Chair Adam Schiff, who knows well the nexus between a strong democracy and a strong economy,” Pelosi (D-CA)—a two-time speaker of the House who stepped down from leadership earlier this year—said in an email. “In his service in the House, he has focused on strengthening our democracy with justice and on building an economy that works for all.”

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Labor provisions in the Inflation Reduction Act kicked in over the weekend for projects that want to take advantage of tax incentives. They’re meant to boost wages and job training opportunities. But developers, contractors, and investors need further guidance to maximize the IRA’s roughly $270 billion in clean energy tax credits. They’re still trying to figure out exactly when the apprenticeship requirements apply, how exemptions from the requirements are interpreted, and how to determine wages for specific renewable energy jobs. “If one party is willing to assume the risk of non-compliance, then projects are moving forward,” said Hilary Lefko, a renewable energy tax partner at Norton Rose Fulbright. “But if no one is willing to accept the risk of the consequences of not being compliant, then that’s halting investment, that’s halting construction, and projects won’t get built until people are more comfortable with the rules.” More broadly, the layering of domestic-content provisions on top of the clean-energy push complicates things. E&E News.

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Vacation Rentals Boom in Phoenix As Phoenix, Arizona, counts down to the Super Bowl on Feb. 12, the clock is also ticking for the region’s short-term rental owners, who are frantically getting their properties ready for the thousands of visitors, reports the Phoenix Business Journal. As many of the hotels in the area have already filled up, some homeowners have been able to list their properties on short-term rental sites like Airbnb and snag rates as high as $10,000 each night. For instance, Hózhó Scottsdale—an 11-bedroom, 12-bathroom property in Scottsdale complete with a lazy river—is already booked for the entire week before the Super Bowl for $11,770 a night. Maybe WECA’s Bob Bartlett could rent you a room!

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California’s High-Speed Rail Gains Another Capitol Hill Detractor The seemingly never-ending bullet train project didn’t have a terrific 2022, and, if trends are any indicator, things won’t look much better in 2023. For the newest member of the House Transportation and Infrastructure Committee, the stalling out of California’s bullet train means it's time to get serious about road expansions on the Valley floor. During The Sun’s interview with Rep. John Duarte (R–Modesto), Duarte touched on the major need to improve transportation in the region, starting with two key numbers: 5 and 99. More

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Thursday, January 19, 2023   WECA Political Update January 19, 2023

California Labor Commissioner Issues FAQs Clarifying Pay Transparency Law California enacted a pay transparency law (SB 1162) requiring employers with 15 or more employees to disclose pay scales in job postings beginning January 1, 2023. The Labor Commissioner recently issued guidance in the form of FAQs to address some of the unanswered questions regarding the interpretation and enforcement of the California Equal Pay Act.

The law expands pay data reporting requirements for California employers with 100 or more employees. It requires employers with 15 or more employees to include the “pay scale” for a position in any job posting. However, the law is silent on some key issues, such as: (1) how to determine the 15-employee threshold for coverage; (2) how to calculate the “pay scale;” and (3) whether positions that are not required to be filled by a California employee are covered (i.e., remote positions that may, or may not, be performed outside of California). The FAQs provide helpful guidance to address these questions.

The Labor Commissioner’s FAQs clarify the following:

  • Determining 15 Employee Limit: The Labor Commissioner’s guidance explains which individuals companies must count to determine whether an employer is covered under the law and, therefore, must disclose pay scales in job postings. Specifically, the law applies when (1) an employer reaches 15 employees at any pay period and (2) one employee is currently located in California. When calculating the 15-employee minimum threshold, “bona fide” independent contractors are excluded, while exempt employees, part-time workers, minors, and new hires are included.
  • Defining Pay Scale: The law defines “pay scale” as the salary or hourly wage range that the employer reasonably expects to pay for the position. The FAQs clarify that “pay scale” excludes bonuses, commissions, tips, or other benefits. However, if a position’s salary or hourly wage is based in whole or in part on either commission or a piece rate, then the commission range or piece rate the employer reasonably expects to pay for the position must also be included in the job posting.
  • Posting Requirements: The guidance clarifies when and how the new “pay scale” information must be disclosed. The FAQs explain that the “pay scale” must be included within a job posting if the position “may ever be filled in California,” either in-person or remotely. The wage info must be displayed in the job posting and cannot be included via a link or QR code. 

Considering the Labor Commissioner’s FAQs, California employers should thoroughly review their job postings to ensure compliance with the new pay transparency law and the Labor Commissioner’s guidance. They should consult counsel before revising or posting new job positions in 2023. Story

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Cal/OSHA Approved COVID-19 Prevention Non-Emergency Regulations On December 15, 2022, the California Occupational Safety and Health Standards Board (Cal/OSHA) voted to adopt COVID-19 Prevention Non-Emergency Regulations (Non-Emergency Regulations). Approval by the Office of Administrative Law (OAL) is expected shortly, and the new regulations are expected to take effect this month. Although the new regulations include requirements like those currently found in the Cal/OSHA’s COVID-19 Prevention Emergency Temporary Standards (ETS), the Non-Emergency Regulations also incorporate significant differences that will change how employers engage with their employees and operate their businesses for COVID-19. Story

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California Legislators Have Refused to Fix CEQA. Davis Law Professor Offers Advice to Newsom and the Courts to “Take Charge” Chris Elmendorf is the Martin Luther King, Jr. Professor of Law at UC Davis and a longtime resident of San Francisco. He wrote this (#nottheonion) for the San Francisco Chronicle. “The California Environmental Quality Act — colloquially known as CEQA — has long been considered the state’s flagship environmental law. Debate over whether CEQA deserves to retain that status, however, has grown heated in recent years. The nub of the problem is that the law’s central premise doesn’t fit the great environmental problems of our day. It wouldn’t be hard for the Legislature to resolve CEQA’s flaws, but there’s no political will to do it. That’s because CEQA, in practice, is not just an environmental protection law. Trade unions have become experts at using the threat of CEQA litigation to extract labor agreements from developers. Time is money — literally — for project investors, and litigation and delay have become so costly that developers of high-value projects will gladly incur substantially higher labor costs to avoid it. On smaller, more financially marginal projects, however, developers can’t afford the extra labor costs or the risk of delay. So, these projects don’t get proposed at all. Perhaps not surprisingly, the trades have defeated almost every legislative proposal to streamline CEQA review of green projects — unless the bill comes with labor requirements that raise the cost of building the very things we need the most. A couple of years ago, the Planning and Conservation League Foundation convened a group of veteran CEQA attorneys from across the ideological spectrum to develop a consensus proposal for modest procedural reforms. Even this was too much for the trades, which killed it. Story

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2024 Election Season is On Politico notes it’s “game on” for 2024. “Thirteen months before the primary and 400 miles from her home base, Rep. Katie Porter held the first event of what promises to be a raucous U.S. Senate race. The Orange County Democrat kicked off her campaign with a visit to the East Bay’s Rossmoor Democratic club, a rich vein of three critical resources: donations, volunteers and high-propensity Democratic voters. It’s also all but impossible to win statewide without piling up votes in the Bay Area. ‘The fact that she’s here within a week of announcing her candidacy means Northern California is in her heart,’ Assemblymember Rebecca Bauer-Kahan told a crowd of hundreds in an intro speech (RBK is so far neutral in the Senate race.). Whiteboards were featured heavily — fittingly, since Porter built her reputation by grilling executives with her signature prop and is centering her campaign on countering entrenched interests. A few women in the audience had specially made “4 Katie!” mini whiteboards pinned to their shirts. An emcee screened a video of one memorable interrogation and recounted others to murmurs of recognition. Porter boasted about lobbyists cowering from ‘the whiteboard treatment.’ California, she said, needs ‘our best warrior in the Senate.’ In a possible preview of how she’ll approach Democratic rivals, she said it’s for ‘a fresh new voice.’ Porter was able to get in front of potential voters before the competition because she didn’t wait for Sen. Dianne Feinstein to confirm the pervasive presumption that she won’t seek another term. Before holding the cycle’s first campaign event on Tuesday, Porter issued the first strength-signaling fundraising release ($1.3 million in 24 hours) and rolled out the first high-profile endorsement (Sen. Elizabeth Warren, her mentor and former professor). But she won’t long have the field to herself. Rep. Barbara Lee has already said she’s in, and Rep. Adam Schiff shouldn’t be far behind. To differentiate themselves from rival Democrats, they’ll need to put in the time with the party faithful at Rossmoor-like clubs around the state. They’ll also need to raise enormous sums of money — and a key to that is accumulating numerous small-dollar donors, like the types of people who show up to a campaign event on a Tuesday night many months before they’ll cast a vote. Porter has demonstrated fundraising acumen — and some ground to make up. She raised more than $25 million last cycle but spent some $27 million to survive a bruising reelection race, leaving her with about $7.7 million at November’s end. Schiff, ensconced in his safe Los Angeles district, raised a similar amount but spent markedly less than Porter, leaving him with more than $20 million on hand. Lee, who is less of a fundraising juggernaut, had $54,000.”

Dan Walters opines on the race here.

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And because Porter will give up her hard-won and costly house seat to run for Senate, it Opens Up a Desirable House Seat. There is a new contender for Porter’s opening House seat: Democratic state Sen. Dave Min is running for CA-47 with an endorsement from Porter, who said in a statement Min has “proven that he can win in this area while delivering on a progressive agenda.” Min finished behind Porter in the 2018 House primary. He joins a field that includes former Democratic Rep. Harley Rouda and former Republican Assembly member Scott Baugh. One big winner from this development is State Sen. Josh Newman of Fullerton. Last year, California’s redistricting commission put Min and Newman, both Democrats, in the same district. Min’s announcement spares Newman the prospect of an incumbent-on-incumbent fight. Min unseated Republican state Sen. John Moorlach in 2020, flipping one of that cycle’s most contested state Senate seats. He represents much of Porter’s district in the Legislature and could show strength with its large Korean-American electorate. More

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And another look at the Senate Race is Everyone for Themselves — “California’s shadow Senate campaign is already spilling out into the light,” said the Daily Beast’s Sam Brodey. “No matter how the eventual field shakes out, California politicos are bracing for a bruising intra-party battle royale. In the state’s election system, the top two vote-getters in the primary advance to the general election, regardless of party — which means that in this deep blue state, a Democrat-versus-Democrat matchup in November 2024 is not only possible, it’s likely.”

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Klobuchar Leery of Silicon Valley Influence: Their Cash, Not So Much Sen. Amy Klobuchar (D-Minn.), one the chief architects of last year’s Senate push to rein in tech giants, went to Silicon Valley to raise money for her reelection, according to a recent story. She held a fundraiser at the Palo Alto of venture capitalist Greg Sands and his wife Sarah. According to the invite, the event was organized by the Bay Area fundraising group Electing Women Bay Area. Greg and Sarah Sands are longtime Democratic donors who bundled at least $25,000 for Klobuchar’s 2020 presidential bid, according to an archived page on the campaign’s site. They also hosted fundraisers for Hillary Clinton in 2016 and Joe Biden in 2019. For Klobuchar, tonight’s fundraiser will take her onto the home turf of several top foes whose furious lobbying efforts last year sank the senator’s bipartisan antitrust push. Tickets started at $1,000 for guests to get face time with Klobuchar, who chairs the Senate’s antitrust subcommittee and has vowed to forge ahead with efforts to crack down on the dominance of tech companies like Apple, Meta, Amazon, and Google. And in case you’re wondering, no, I did not attend.

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And You Thought 2024 Would Be Biden vs. Trump? Five hundred and thirty-one people have filed with the Federal Election Commission (FEC) to run for president in 2024 as of January 17. The list includes 77 Democratic candidates (14.5%), 145 Republican candidates (27.3%), and 309 nonpartisan or minor party candidates (58.2%). This figure excludes candidates whose filings have expired or were identified as fake candidates (George Santos?). Any person running for president that raises or spends more than $5,000 for a campaign must file a Statement of Candidacy with the FEC within 15 days. To do so, that person must be a natural-born citizen of the United States, at least 35 years old, and a resident of the United States for at least 14 years. A Statement of Candidacy includes basic information like the candidate’s name and address and any campaign committees working for them. The number of filings in the 2024 election is the third-most in 40 years. In 2016, 1,762 candidates filed with the FEC to run for president. In 2020, 1,212 candidates filed.

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Ouch! Major Orange County Republican Group Lost on 96% of its Local Bets in Latest Election The Voice of OC reports: “They’ve been a dominant force in Orange County elections for decades. In the November election alone, the Lincoln Club of Orange County spent nearly $1 million on local races, weighing in on campaigns for county supervisor, city council, and school board. But this time, the club – one of the county’s most prominent GOP spending groups – lost most of its bets. A whopping 96% of the group’s major spending on local races went to support candidates who lost or opposed people who ended up winning.” Story

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Sinema Angles for Approps Sen. Kyrsten Sinema (I-Ariz.) is eyeing a seat on the powerful Appropriations Committee, according to two people familiar with the matter. Sinema is entering her fifth year in the Senate, a level of seniority that puts her in contention for the plum gig. However, there’s a new dynamic in town: Sinema left the Democratic Party to go independent, though she is still essentially a part of the Democratic Caucus. Regarding timing, Senate leaders are still working out the committee ratios, and it’s unclear when they will be announced.

And Sinema may have her hands full in 2024! The Washington Post reports Kari Lake, Blake Masters, Pinal County Sheriff Mark Lamb, and Karrin Taylor Robson are all “seriously” considering jumping into the 2024 Arizona Senate race. No word on former Governor Doug Ducey, whose race for Senate was torpedoed by DJT because Ducey wouldn’t embrace “the steal.”

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California’s Top Oil Regulator Abruptly Exits: SV Sun reports “For the second time in two years, the Golden State’s oil czar is hitting the exits after ruffling one too many feathers with environmental activists. Uduak-Joe Ntuk took over running California’s Geologic Energy Management Division (or CalGEM) in late 2019 after his predecessor, Ken Harris, was sacked by Gov. Gavin Newsom for quietly approving a hefty number of fracking permits. Since Newsom took office, Sacramento has focused on virtually eliminating all oil production. CalGEM (formerly named the clunky “DOGGR”) has retained its position as the most demanding regulatory agency to balance ongoing needs with Sacramento’s demands.”

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Solar Struggles: Three environmental groups filed an appeal this week, insisting the California Public Utilities Commission (CPUC) reconsider a decision to slash the prices utilities must pay new rooftop solar customers for excess power. The Center for Biological Diversity, Protect Our Communities Foundation, and the Environmental Working Group said in a news release announcing their appeal that the change “threatens the growing rooftop solar market and puts affordable and resilient renewable energy out of reach for most communities.” The CPUC sharply reduced the rates for customer-generated power in a December decision that also eliminated a solar tax. Commissioners said the change was aimed at encouraging new customers to add battery storage at their homes to help offset heavy energy usage during California evenings when solar generation stops. A CPUC spokeswoman said the program has essentially subsidized electricity prices for wealthier Californians who can afford rooftop solar. The appeal asks the CPUC to reconsider the analysis that led to the December net metering decision and to reverse it, saying it fails to fulfill state statutes that require growth of distributed renewable generation, including among disadvantaged communities. I, for one, am not holding my breath. The CPUC was unanimous in voting for NEM 3.0, and I doubt any commissioner, much less a majority, will say, “Whoops, my bad.”

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And We’re Done Republican David Shepard conceded his race for Senate District 16 (Sanger). His statement reads: “Thank you to the constituents of Senate District 16. This race has been historically close, and as the recount draws toward the end, I believe our path forward to victory is no longer feasible. From our 22-vote deficit, our recounting of ballots closed the gap to 13 votes. This means that nine voters who initially were prevented from voting in this election had their votes tallied. This election has exemplified the saying that, ‘every vote counts.’ Although the result is not the one we had hoped for, I am so incredibly thankful for the team that surrounded me during the recount and believed in me and my candidacy for state senate.” Shepard is a supervisor of table grape operations for his family’s farming company EW Merritt Farms.

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Thursday, January 5, 2023   WECA Political Update January 5, 2023

Arizona Senate 2024 According to Politico, Rep. Ruben Gallego (D-Ariz.) is ramping up his political operation ahead of an expected entry into the Arizona Senate race against newly independent Sen. Kyrsten Sinema. Gallego has recently hired a pollster, interviewed paid media firms, and started hiring veterans from the successful campaigns of Sens. John Fetterman, Mark Kelly, and Raphael Warnock. Since Sinema announced her party switch, Gallego has reportedly received more than 25,000 individual financial contributions.

And, Arizona Republican Rep. Andy Biggs is at the forefront of efforts to keep California Republican Kevin McCarthy (R-Calif.) from being Speaker of the House. Biggs, the former head of the far-right House Freedom Caucus, was the first Republican to challenge McCarthy's bid. Rep. Paul Gosar (R-Ariz.) formally nominated Biggs. Eli Crane (R-Ariz.), a freshman, was among about 20 House Republicans who consistently sided with someone other than McCarthy. Story

And, California Republicans fear McCarthy's loss would be theirs as well. Politico reports, "For many GOP lawmakers in California, McCarthy is not only a friend and former colleague. He's a source of campaign cash and proof that their party could still be relevant — at least outside the state. Now, that seems to be slipping away along with his grip on the speakership. 'He has been the most important Republican in California for the past decade,' said Rob Stutzman, a Republican consultant who worked under former Gov. Arnold Schwarzenegger when McCarthy was in the state Legislature.

But, the would-be speaker's ascent has also divided him from some conservative former allies who believe he has put ambition — and loyalty to Trump — over principle. Bill Thomas, the former Republican Congress member and onetime mentor, denounced his former aide in 2021 for enabling Trump's 'lies' about the election. 'I'm very troubled by what appears to be an active preference of a minority of elected officials that believe throwing bombs is their key to success,' said former Republican State Sen. Roger Niello, who served in the Assembly with McCarthy. 'Kevin McCarthy is not a bomb-thrower."

New Boss at California Labor and Workforce Development Agency (LWDA). The Sacramento Bee reported Gov. Gavin Newsom's top adviser on California labor issues abruptly left her post in December under uncertain circumstances. Natalie Palugyai, who Newsom appointed as secretary of the California Labor and Workforce Development Agency in July 2021, is no longer with the department, the governor's office and the agency confirmed. Before arriving in Sacramento, Palugyai was Senior Advisor for Strategic Initiatives at Johns Hopkins University in Baltimore. Palugyai replaced Julie Su after the U.S. Senate approved her as the next Deputy Secretary of the Department of Labor. Lest any of you readers be concerned for Palugyai's financial condition, Newsom appointed her to the Workers' Compensation Appeals Board. Salary: $170,464. Her replacement at LWDA is Stewart Knox, undersecretary since 2021. His new salary: $232,858.
 
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Tuesday, November 22, 2022   WECA Political Update November 22, 2022

I had planned to provide a more comprehensive overview of the November election, but as the editorial deadline approaches – and several California races are undecided – here is Politico’s take on some of the tightest races in California.

Races Still in Limbo Members of Congress targeted for defeat — both Democrats and Republicans — have held onto their jobs or, in one case, led a too-tight-to-determine race. Despite the tens of millions of dollars spent to dislodge officeholders in tight districts, voters chose to return their representatives to the House. But Republican challengers have a clear path to picking up a few seats in the Legislature by ousting Democratic state lawmakers — something we haven’t seen in several cycles — and a Republican could be unseated. To add to the drama, several races are separated by fewer than a thousand votes and two by fewer than twenty.

While Republicans managed to wrest control of the House from Democrats, in California, the two parties have fought to a draw. GOP Reps. Michelle Steel, Ken Calvert, Mike Garcia, and Young Kim bested Democratic challengers; Democratic Reps. Katie Porter, Mike Levin, Julia Brownley, and Josh Harder rebuffed GOP opponents. As a result, Rep. David Valadao has consistently led Democratic Assembly member Rudy Salas and had a 4,500-vote margin on Friday. However, the race has not been called (and we should note that, in 2018, it took weeks for Valadao to lose his lead for good).

On Friday, a prime legislative race came off the board as Democratic Assembly member Brian Maienschein’s Republican opponent, Kristie Bruce-Lane, conceded and ended one of the CAGOP’s preeminent seat-flipping opportunities.

But multiple Sacramento incumbents are in trouble. Republican Assembly member Suzette Valladares Martinez, whose rare pickup of a formerly Democrat-held open seat was a bright spot for the party in 2020, fell 511 votes behind Democrat Pilar Schiavo over the weekend. Democratic Assembly member Ken Cooley slipped 16 votes behind Republican staffer Josh Hoover on Friday. In contrast, state Sen. Melissa Hurtado — forced by redistricting to move rather than take on fellow Democratic Sen. Anna Caballero — trailed Republican farmer David Shepard by a few thousand votes. Democratic party PACs and outside interests spent more than $4 million to protect Hurtado and about $3.5 million to safeguard Cooley in the general election.

The final balance of power will swing on a few nailbiter contests for open seats: In the Central Valley, Republican farmer John Duarte had an 865-vote advantage over Democratic Assembly member Adam Gray for a spot in Congress, and Democrat Esmeralda Soria sat a couple of thousand votes above Republican ex-Sheriff Mark Pazin for a seat in the Legislature.

Further south, Democratic Palm Springs Council member Christy Holstege was just nine (9) votes ahead of Republican staffer Greg Wallis for a battleground Assembly seat. Holstege and Soria have participated in new member activities, including the speakership fight. [Politico]

And many of you will recall Senator Bob “Huggy Bear” Hertzberg, who authored SB 954 that prohibited the use of “industry advancement” credits on prevailing wages by non-union contractors. The Los Angeles Times noted A double defeat for the Hertzbergs: “Termed-out state Sen. Bob Hertzberg had hoped to win a seat on the Los Angeles County Board of Supervisors — but Lindsey Horvath, a progressive West Hollywood city councilmember, beat him. And Daniel Hertzberg, who sought to succeed his father in the Senate, lost to Caroline Menjivar, a military veteran who will be the first openly LGTBQ+ legislator to represent the San Fernando Valley. The two races mark a victory for political newcomers from the left over a nascent political dynasty.” So, let’s all drink a toast to LA voters!

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A Fight is Brewing Politico gave Rep. Mike Garcia’s victory over Democrat Christy Smith in CA-27 as Republicans’ 218th seat in the House — and majority control for the first time since 2018. Others gave that honor to Rep-elect Kevin Kiley (R – representing a vast swath of Northeast California). Whatever, the House is now under Republican control with Kevin McCarthy living by my eternal motto – “be careful what you ask for.” Why, you ask? McCarthy (whose election to speaker is not assured) will be tasked with leading the House with the slimmest (autocorrect kept changing that to slimiest) of majorities which means he will be continually whipsawed by a minority of his caucus who want to repeal the 2020 election, impeach the majority of Biden administration Secretaries, and subject the Biden family to countless hours of House Committee hearings while China prepares to invade Taiwan, Russia pummels Ukraine, DPRK perfects “the peoples’” ICBMs, and Iran builds more nuclear (pronounced – well – you decide) bombs. Sorry – not the best “Thanksgiving” soliloquy.

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Democrats Poised to Take Majority on Orange County Board of Supervisors for First Time in Decades Democrats are on the cusp of having a controlling majority on Orange County’s Board of Supervisors for the first time in nearly 50 years. The latest election results Thursday evening – which reflect 97% of all ballots cast across Orange County (OC) – had Democrat Katrina Foley holding her lead over former State Senator, Republican Pat Bates, 51.2% to 48.8%. Bates reportedly called Foley “to congratulate her.” This south OC 5th District seat decides which party will have a majority on the board. The last time Dems had control – they adopted a countywide PLA – you can bet the building trades are poised with a PLA for early adoption in 2023. [Voice of OC]

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“Back In the Saddle Again!” One week after securing his sixth term in the Assembly, Asm. Jim Patterson (R – Fresno) is throwing himself right back into the campaign trail. First elected under California's current legislative term limits scheme, Patterson is set to reach his maximum twelfth year in Sacramento in 2024. So on Wednesday, while guest-hosting lunchtime rush radio in Fresno, Patterson uncorked what has long been an open secret: he's planning on running for Fresno County Supervisor in 2024, opening up a challenge against a fellow Republican.

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Budget Deficit Projected The State’s Legislative Analyst (LAO) released a report this week – titled Economic Conditions Weigh on Revenues – that reported on several economic factors California will face next year. The LAO concludes these could push the State back into a budget deficit. Facing rising inflation, the Federal Reserve — tasked with maintaining stable price growth — repeatedly enacted significant interest rate increases throughout 2022 to cool the economy and slow inflation. The more prolonged inflation persists, the higher the Federal Reserve increases interest rates in response and the greater the risk to the economy. The chances that the Federal Reserve can tame inflation without inducing a recession are narrow. Reflecting the threat of a recession, the LAO’s revenue estimates represent the weakest performance the State has experienced since the Great Recession.

Under this outlook, the Legislature would face a budget problem of $25 billion in 2023-24. (A budget problem — also called a deficit — occurs when resources for the upcoming fiscal year are insufficient to cover the costs of currently authorized services.) The budget problem is mainly attributable to lower revenue estimates, which are lower than budget act projections from 2021-22 through 2023-24 by $41 billion. However, lower spending in certain areas has partially offset revenue losses. As a result, over the subsequent years of the forecast, annual deficits would decline from $17 billion to $8 billion. (Chump change.)

The Assembly Speaker and other legislative leaders have indicated they want to continue spending. Still, the LAO cautions, “We discuss the State’s reserves, which are the State's key tool available to address budget problems. We urge lawmakers to begin planning the 2023-24 budget without using general purpose reserves and, instead, to save those reserves for when the State faces a recession.” Let’s hope the Legislature and Governor Newsom heed this recommendation! But signals suggest “no.” Assembly Budget Chair Phil Ting (D - San Francisco) told Politico, “Projections are just that — projections.” (Awesome analysis, sir.)

As CalMatters reported earlier this year, California adopted a $308 billion budget that will provide refunds to most taxpayers in the State, pour resources into expanding abortion access, and extend health care to more undocumented immigrants. The final agreement, which includes $234.4 billion in general fund spending, is similar to a placeholder budget that the Legislature passed earlier to meet a constitutional deadline. But at Newsom’s insistence, new spending commitments were slashed by several billion dollars, and some appropriations will only be triggered in future years if revenue estimates hold up. As the state eyes another potential economic downturn, reserves will grow to nearly $38 billion, including more than $23 billion in the general rainy-day fund.

So, if the State does face a deficit, unless spending is cut or additional revenue (taxes and fees) is raised, the State would be forced to spend the entire general rainy-day fund or cut services – and this is before what some economists are forecasting – a moderate recession in 23-24!

The tax rebate program, debated for months, was the centerpiece of the budget deal. Under the $9.5 billion plan, more than 95% of taxpayers — those making as much as $250,000 a year, or $500,000 if they file jointly — are supposed to receive a payment this fall. The amounts vary based on income and whether the recipients have dependents, so a low-income family with children will receive $1,050. In contrast, a single taxpayer with a higher income will receive just $200.

With the new legislative year commencing on December 5, it will be interesting to see if the members take the deficit projections seriously – or if they will punt the ball to Governor Newsom. He might be forced to cut billions from next year’s budget.

By the way, David Crane of Govern for California agrees. Read his letter to the Legislature here..

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State Lithium Panel Recommends PLAs, Other Steps As reported in the Palm Springs Desert Sun, “California’s Lithium Valley Commission has finished a comprehensive report on how to maximize the development of the critical mineral and create jobs and economic opportunities while aiming to protect public health and benefit local communities.” The report included several recommendations urging “California to push to create a so-called ‘circular’ in-state economy related to lithium, from extraction through production, transportation and even recycling of batteries and other products. The report also calls for state and federal funding of badly needed infrastructure to implement commercial lithium production, including paved roads, transmission lines, and repaired or new bridges. It urges the State to incentivize companies to use Project Labor Agreements with area unions, to do local hiring and provide workforce training, but stopped short of asking the Legislature to mandate them explicitly in exchange for public funds.”

There is no direct online link to the final report, but it should be posted on the commission’s docket when it is complete.

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Do People Not Want to Work in Construction Anymore? Most of you probably saw this in Construction Dive but in case you missed it, “Construction is no stranger to labor shortages. Over several decades, funding that advocates for higher education as the primary career route for young adults has continued to increase, drying the well of entry-level workers for the trades. Many believe there is a sentiment that people don’t want to work with their hands anymore in what can be a dirty, back-breaking job.” Story

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Candidates Galore A combined 2,998 candidates ran for president in 2016 and 2020. On Nov. 15, former President Donald Trump (R) announced he would run for a second term — and filed the paperwork to make it official. Anyone can file to run for president with the Federal Elections Commission (FEC). In 2016 and 2020, 2,998 individuals filed to run for president with the FEC. In 2016, 1,786 candidates filed with the FEC; in 2020, that figure was 1,212.

Of the candidates who filed in 2020:

·        323 filed as Democratic candidates

·        164 filed as Republican candidates

·        65 filed as Libertarian candidates

·        23 filed as Green candidates

Of the candidates who filed in 2016:

·        228 filed as Democratic candidates

·        288 filed as Republican candidates

·        56 filed as Libertarian candidates

·        14 filed as Green candidates.

[Ballotpedia]

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CSLB Shares Additional Details Regarding Workers’ Compensation Insurance Requirement for Four License Classifications The Contractors State License Board (CSLB) is informing active licensees starting January 1, 2023; renewals will not be processed without proof of workers’ compensation insurance for license classifications C-8 (Concrete), C-20 (Warm-Air Heating, Ventilating and Air-Conditioning), C-22 (Asbestos Abatement), and D-49 (Tree Service), regardless of whether the contractor has employees. The new workers’ compensation insurance requirement for C-8, C-20, C-22, and D-49 licensees results from Senate Bill 216, which takes effect January 1, 2023. The only exception in SB 216 is for joint venture licenses, which will still be able to file a certificate of exemption if one of the joint venture license entities has a workers’ compensation insurance policy.

SB 216 also requires that all active contractors – with or without employees – have a valid Certificate of Workers’ Compensation Insurance by January 1, 2026.

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Brand Offers a Spicy Response in Lawsuit Defense A name is just a name on a bottle of hot sauce, especially when the back of the label and the company’s website says so. That’s the gist of the defense offered by Garner Foods Co. of Winston-Salem, North Carolina, in a federal lawsuit that contends the name “Texas Pete” and its packaging are deceptive because the product is not made in the eponymous state but rather in North Carolina. Attorneys for Garner Foods filed their response in the case recently seeking dismissal on numerous grounds, but particularly noting that the company is not in the least deceptive or misleading toward consumers because it makes clear products with the Texas Pete brand name are not made in Texas, reports Triad Business Journal's David Hill. “The back label of the product clearly states the location of its source as Winston-Salem, North Carolina,” states the motion to dismiss. “Nowhere on any of the product's labels does it state or represent that the product is made in Texas or is a product of Texas.” Plaintiff Philip White said in the initial complaint filed Sept. 12 in the Central District of California federal court that Garner Foods violated laws regarding unfair competition and false advertising by presenting or implying Texas Pete as made in Texas.

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And what will surely bring tears to faithful readers - NLRB Feels the Heat: The National Labor Relations Board “will likely be forced to pursue furloughs” if its funding isn't boosted in the next congressional spending deal, the agency's top officials warned last week. “At this point, the Agency has exhausted its ability to absorb cost increases through staff attrition, and operational efficiencies," board Chair Lauren McFerran and General Counsel Jennifer Abruzzo told key congressional appropriators. McFerran and Abruzzo’s appeal makes public what the NLRB had been signaling in communications with the unions representing agency staff. Now, don’t get me wrong. Having been furloughed once or twice in my adult life, I am empathetic to those being cast aside (Governor Wilson notified a small group of former Senate employees who were establishing the California Research Bureau, including yours truly, of cancelation of our employment MOU – on Christmas Eve. Who said Wilson had no sense of irony – or humor?) But come on, who thinks the House in the 118th Congress will toss a life ring to the NLRB?

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And Before You Go, Some Good News California’s new poet laureate, Lee Herrick, is a community college teacher from Fresno. Herrick, 52, is a writer and professor at Fresno City College and a teacher at the University of Nevada, Reno, at Lake Tahoe, The San Francisco Chronicle reports. He was born in South Korea and adopted by a family in Modesto as an infant. In appointing Herrick as California’s 10th poet laureate, Gov. Gavin Newsom praised his “vivid celebration” of the California experience. “Lee’s dedication to highlighting the diverse experiences of Californians, and making them so accessible through his poetry, makes him a perfect candidate for poet laureate,” Newsom said in a statement on Friday.

Happy Thanksgiving!

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