In This Issue:

• HISTORY MADE AS NEW SPEAKER SWORN-IN

• GOVERNOR RELEASES REVISED BUDGET

• WORST OF THE WORST LEGISLATIVE BILLS

• GOVERNOR'S ENVIRONMENTAL AND ECONOMIC LEADERSHIP AWARDS

• FEDERAL TAX “EXTENDERS” PASSAGE URGED

• SMALL BUSINESS LOANS FOR ENERGY-EFFICIENT EQUIPMENT

• CALIFORNIA COMMERCIAL REAL ESTATE SUMMIT JUNE 10-11

• CBPA 2008 CALENDAR

HISTORY MADE AS NEW SPEAKER SWORN-IN

Karen Bass (D-Los Angeles) has been sworn-in as the first African American woman leader of either chamber of the California Legislature. As the new Speaker of the California State Assembly, Ms. Bass has narrowed her goals while holding the office to “budget, budget, budget.” We congratulate Ms. Bass on earning such a high achievement and look forward to working with her.
 

GOVERNOR RELEASES REVISED BUDGET

Governor Arnold Schwarzenegger has submitted his revised 2008-09 state budget plan to the legislature. It is a budget that tries to address California’s $17.2 billion budget deficit. It’s a budget that is being roundly criticized from every conceivable angle. Although the Governor’s staff describes the spending plan as fully funding education under Proposition 98, not raising taxes and establishing a rainy day fund to address California's chronic budget problem, Democrats in the Legislature have described it as being “D.O.A.”.

Click here to read the Governor’s May Revise Press Release.

Click here to read the Senate pro Tem Democratic Response.

Click here to read the Assembly Republican’s Response.

Depending on which political insiders you speak to, this will either be the shortest budget impasse in history, since the problem is so bad there isn’t much to fight over; or it will be the longest budget impasse in history because the shortfall is so big there will be too much to fight over.
 

WORST OF THE WORST LEGISLATIVE BILLS

Today marks the First House Policy Committee Deadline in the California State Legislature. To commemorate this special day we have pared down the list of 400 bills we are working on to the ten (or so) worst bills that are still alive. Enjoy!

AB 1065 (Lieber; D-Mountain View) Severely impedes commercial and residential development by requiring all new buildings use 50% less energy by 2020 and 80% less energy by 2030. This is technically impossible for most building types.

AB 2030 (Lieu; D-Torrance) “Zero Net Energy” for commercial. Would debilitate commercial development by requiring all new buildings generate 50% of used power onsite using “sustainable” technology. This is technically impossible for most non-residential building types.

AB 2046 (Jones; D-Sacramento) Would essentially halt residential and commercial development by fundamentally altering water planning by obligating new development water assessments be done to drinking water standards.

AB 2112 (Saldana; D-San Diego) “Zero Net Energy” for residential. Would severely hinder residential development by requiring all new buildings generate 50% of used power onsite using “sustainable” technology. This is technically impossible for most residential building types.

AB 2153 (Krekorian; D-Burbank) “Zero Net Water” for development. Would stall residential and commercial development requiring unobtainable water conservation standards.

AB 2514 (Eng; D-Monterey Park) Severely complicates commercial and residential development by applying the “Sacred Sites” process to any development where non-native American human bones are found.

AB 2558 (Feuer; D-Lost Angeles) Allows for a “climate change mitigation fee” which undermines the AB 32 process and adds another layer of taxation that will severely harm businesses.

AB 2616 (DeVore; R-Irvine) Overturns the Pruneyard case and erodes private property rights by mandating that large retailers allow protestors and signature collectors to stand at the entrances and exits of their facilities.

AB 2678 (Nunez; D-Los Angeles) Hurts the existing housing and commercial real estate markets by requiring that before a building is sold the current owner conduct an energy audit and make some yet to be determined upgrades to the energy efficiency. Many buildings will simply not be sold as homeowners and small businesses will not be able to make such investments during escrow.

AB 2939 (Hancock; D-Berkeley) Authorizes local jurisdictions to supplant Title 24, the state building code, with private building standards such as LEED.

AB 2973 (Blakeslee; R-San Luis Obispo) Mandates that a structural engineer consultant report building structural information to local officials and denies the right for a building owner to redress grievances in court.

SB 375 (Steinberg; D-Sacramento) Would all but stop commercial and residential development through imposing an impossible land use scheme.

SB 445 (Torlakson; D-Antioch) Allows for a “climate change mitigation fee,” which undermines the AB 32 process and adds another layer of taxation that will kill businesses.

SB 974 (Lowenthal; D-Long Beach) Imposes a “container tax” on all goods coming in and out of California ports.

Click here to look up bills and read the text.
 

GOVERNOR'S ENVIRONMENTAL AND ECONOMIC LEADERSHIP AWARDS

The Governor’s Environmental and Economic Leadership Award Program is the State of California’s highest environmental honor. The program recognizes individuals, organizations, and businesses that have demonstrated exceptional leadership and made notable, voluntary contributions in conserving California’s precious resources, protecting and enhancing our environment, building public-private partnerships and strengthening the State’s economy.

Competition is open to all California residents, businesses, non-profit organizations, professional and trade associations, communities, state and local government entities, tribes, and federal agencies operating in California.

The awards will be presented for voluntary achievements undertaken or completed in 2007 or culminated during 2007. Projects are deemed ineligible if they are the result of mitigation, litigation, or required by legislation.

If you know of any project that has focused on sustainability or energy efficiency, you should submit a nomination. And yes, you should nominate yourself!

Click here for more information. Deadline is May 30, 2008.
 

FEDERAL TAX “EXTENDERS” PASSAGE URGED

A large and diverse coalition of business, labor, and nonprofit organizations (including real estate groups such as BOMA International, ICSC, and NAIOP) have banded together to urge Congress to approve legislation to extend a set of tax provisions that either expired at the end of 2007 or will at the end of this year.

Among the proposed tax extenders are provisions for leasehold improvement depreciation and brownfields remediation. The extenders also include a one-year extension of the deduction for energy efficient commercial buildings. The legislation would provide for another one-year “patch” to the alternative minimum tax (AMT).

S. 2886 would retroactively extend both commercial real estate provisions to the beginning of 2008 through 2009. Among other things the bill would:

*Extend the energy-efficient commercial buildings deduction for five years (through December 31, 2013).
*Extend for one year (through 2008) the special 15-year cost recovery period for certain leasehold and qualified restaurant improvements. Absent an extension of this provision, the cost recovery period for these facilities would be 39 years.
*Extend for one year (through 2008) the provision that allows for the expensing of costs associated with cleaning up brownfield sites.
*Extend the 30% investment tax credit for solar energy property and qualified fuel cell property and the 10% investment tax credit for microturbines for six years (through the end of 2014).
*Increase the $500 per half kilowatt of capacity cap for qualified fuel cells to $1,500 per half kilowatt of capacity.
*Provide a new 10% investment tax credit for combined heat and power systems.

SMALL BUSINESS LOANS FOR ENERGY-EFFICIENT EQUIPMENT

The California Public Utilities Commission (CPUC) wants to expand a pilot program under which the state’s investor-owned utilities (IOUs) offer no-interest loans to small businesses to buy energy-efficient equipment. It is reported that Southern California Edison (SCE), for example, may propose raising the cap for loans to small businesses from $50,000 to $100,000 and increasing the payback timetable to 10 years for loans to institutional customers such as cities and schools. The goal is to help small businesses buy new equipment that is so efficient that the energy savings will cover the monthly loan payments. In an October opinion, the CPUC told the IOUs to create or continue on-bill financing pilot programs for small businesses and to work on plans for institutional and residential customers.
 

CALIFORNIA COMMERCIAL REAL ESTATE SUMMIT JUNE 10-11

California Commercial Real Estate Summit (CCRES) will be held in Sacramento on June 10 and 11, 2008. This event is the one time of year that industry leaders from all sectors of the commercial, industrial, and retail real estate industry converge on California's Capitol to meet with policymakers. The summit gives you an opportunity to meet other industry leaders from across the nation, high-level staff from Governor Schwarzenegger's Administration, and California State Legislators. Click here for more information and to register for the event.
 

CBPA 2008 CALENDAR

June 10-11, 2008
California Commercial Real Estate Summit
Hyatt Regency, Sacramento, CA

October 23, 2008
Awards Dinner
Island Hotel, Newport Beach, CA