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Highlights of the 2007 Legislative Year

Dan Carrigg is legislative director for the League and can be reached at carriggd@cacities.org.

 

 

In his 2007 State of the State address, Governor Schwarzenegger called for an era of "post-partisanship." Recently reelected, the governor was eager to build upon the legislative achievements of 2006, which included voters’ approval of the state infrastructure package, the enactment of AB 32 (Nuñez) climate change legislation, the increase of the minimum wage and other accomplishments. The governor maintained that 2006 proved politicians could set aside their differences and tackle California’s problems.

 

For 2007, the governor established ambitious goals, including developing a health care solution to provide universal coverage, expanding state investments in infrastructure to address water supplies and build new reservoirs, and enacting redistricting reforms.
But the successes of 2006 proved difficult to repeat. State budget conditions worsened, and declines in the housing market hurt the economy and soured revenues. Post-partisanship was a concept Republican legislators were slow to embrace; they were wary about health care solutions increasing costs for businesses or the state General Fund. Democrats -- led by environmental advocates -- voiced opposition to developing new reservoirs. The elements of political stalemate emerged. Jockeying for positions on a new round of initiatives began with the approval of a February ballot for a presidential primary and the qualification of a legislative term- limit extension initiative.
Budget Impasse Underscores Divisiveness
The year’s defining moment was the long and bitter stalemate over the state budget. The Assembly passed a proposed budget in the wee hours of July 20, 2007, and then -- prior to the Senate approving the budget -- promptly left town for their summer recess. The Senate Republicans, however, were in no mood to pass what the Assembly had sent them. They criticized the budget as being out of balance with available revenues and refused to vote for it until additional cuts were made. Concerns were also raised over climate change litigation filed by Attorney General Jerry Brown against businesses and local governments.
What followed were weeks of partisan finger-pointing, threats of recalls, refusals by the Assembly to return from their summer recess to reopen the budget, press conferences and an all-night "lock down" session with senators sleeping on their desks. The deadlock finally ended on Aug. 22 when the Assembly returned, the governor agreed to a specific list of "blue pencil" budget cuts, and Democrats agreed to approve SB 97 (Dutton), which contained some protection from climate change litigation for projects funded through the transportation bond.
League Makes Progress on Strategic Goals for Cities
The League board of directors had outlined three strategic goals for its 2007 activities:
1. Ensure fair and effective implementation of the 2006 infrastructure bonds, consistent with the needs of California cities;
2. Expand the supply of affordable housing by adopting reforms that reduce the barriers to improved planning and expand the financial resources available; and
3. Adopt statutory and constitutional reforms of the laws governing the use of eminent domain for private economic development purposes.
Progress on Infrastructure: Early in 2007, a League infrastructure task force made recommendations to the board to establish the League’s priorities, including a set of allocation principles. Of paramount priority was the aggressive allocation of the $1 billion in local streets and roads funding to cities from Proposition 1B. After extensive lobbying, and with the assistance of its network of regional representatives and individual city officials, the League successfully secured an allocation of $550 million for local city transportation projects for FY 2007-08.
The League also emerged as a leader in the discussions on legislation related to development in flood plains. Its policy committees and a special task force developed a set of principles that influenced the legislative discussions, including support for better local planning, and helped shape the final package signed by Gover nor Schwarzenegger.
Progress on Housing: Implementation issues associated with the passage of the $2.85 billion housing and infrastructure bond, Prop. 1C, dominated legislative discussions in 2007. Securing an appropriation and developing reasonable allocation criteria for the $850 million dedicated in the bond to infill infrastructure became a high priority for the League. Among funds allocated from this bond for 2007, $240 million was made available for a wide variety of capital improvements to support infill development, and -- consistent with the League’s recommendations -- $60 million is allocated for loans and grants to clean up brownfields. In addition, $95 million was allocated to assist transit-oriented development.
Beyond this, the League introduced a package of bills to:
  • Provide funding for local governments that approved housing;
  • Expand local infrastructure investment tools to support high-density housing;
  • Reform the Density Bonus Law; and
  • Return more local authority over group homes.
Through a combination of local grassroots advocacy by city officials (coordinated by the League’s regional public affairs managers) and lobbying activities in Sacramento, the League successfully defeated every major bill that would have undercut local land use authority over housing.
Progress on Eminent Domain: In an effort to enact responsible eminent domain reform, the League worked with a broad coalition of homeowners, local government and environmental and other groups to encourage the Legislature to place ACA 8 (De La Torre) on the statewide ballot. The goal was to address key concerns about using eminent domain to take housing and small businesses.
Early in 2007, it appeared that other groups with an interest in eminent do main reform were willing to strike a reasonable compromise. One group even initially helped draft and supported ACA 8. Unfortunately, that group later decided to pursue a much more sweeping measure by initiative (the California Property Owners and Farmland Protection Act), which contains numerous hidden agendas that would undermine major water supply projects and includes controversial provisions such as eliminating rent control, inclusionary housing and even routine zoning decisions.
With the issue politically polarized, it was not possible to secure the necessary two-thirds vote to pass ACA 8 -- although it was supported by a strong majority of Assembly members. However, the legislators who did not vote for the measure spoke in positive terms about the efforts to seek compromise undertaken by Assembly Member Hector De La Torre (D-50, South Gate). Due to legislative inaction, the battle has now shifted to the initiative process (for more information, see "An Interview with Assembly Member Hector De La Torre").
Another Bright Spot for Cities
In recent years, news for cities involving the state budget has usually been negative, but in 2007, the post-Prop. 1A (of 2004) trend of budget improvement for cities continued. Highlights included $35 million to cities to reimburse booking fees paid by cities to counties, and $238 million in COPS/Juvenile Justice grants.
The League was also successful in fighting off a legislative budget proposal that would have destabilized the Prop. 42 funding formula that allocates the sales tax on gasoline. Per the existing formula, cities and counties are scheduled to receive double their previous allocations beginning in fiscal year 2008-09.
Stay Informed
City officials are encouraged to participate in this strategic work by tracking legislative issues through the League website www.cacities.org and the weekly electronic newsletter, Priority Focus, and by working with their regional public affairs manager to establish and maintain good relationships with their legislators.