AOC urges ‘no’ on Prop 22 + Are these CA sites ‘fake news’? + Low-income tax credits don’t pan out

Happy Thursday! We hope you’re enjoying the calm before election day.

FIRST UP: AOC wants you to vote ‘no’ on Proposition 22.

via Jeong Park...

Add Congresswoman Alexandria Ocasio-Cortez to the list of prominent Democratic politicians opposing Proposition 22, which would allow companies like Uber, Lyft and Instacart to pay drivers as independent contractors instead of as employees.

“If Prop. 22 passes, gig companies will have no responsibility to provide a living wage or benefits to gig workers - as they face unprecedented struggles during COVID-19,” Rep. Ocasio-Cortez, D-New York, said in a Facebook post on Wednesday.

Tech companies such as Uber and Lyft have poured nearly $200 million into supporting Proposition 22, saying the initiative will keep flexibility for their drivers while giving them benefits such as contribution toward their health insurance.

Labor unions and other opponents of the initiative say under Proposition 22, drivers will miss out on earning minimum wage as well as several benefits such as paid sick leave. While being outspent 10-to-1, the opponents of Prop. 22 have secured endorsements from several prominent Democratic politicians.

Presidential candidate Joe Biden and his running mate California Sen. Kamala Harris, whose brother-in-law is the chief legal officer for Uber, have urged voters to cast a ballot against Proposition 22. Vermont Sen. Bernie Sanders has also said he opposes the measure.

ARE THESE ‘LOCAL NEWS’ SITES LEGIT?

More than 70 California websites purport to be local news sources, but are actually part of a nationwide network of nearly 1,300 sites backed by a collection of conservative think tanks, political strategists and public-relations executives, The Sacramento Bee reports today in this story.

According to a recent investigation by the New York Times, these sites dispense with the unbiased coverage that’s the hallmark of mainstream journalism. Instead, they feature stories orchestrated by conservative operatives and, in some cases, are paid for by corporate clients attempting to gain publicity for a particular issue. Such “pay-for-play” tactics are considered well out of bounds in traditional news reporting.

The company that owns the sites, Metric Media, argues it’s a way to revitalize the local news that has struggled to stay afloat in the age of the internet, but media experts and political watchers say its a whole different kind of operation.

“It is literally fake news,” said Mike Madrid, a California Republican consultant.

WHO EXACTLY BENEFITS FROM THOSE LOW-INCOME TAX CREDITS?

Via Hannah Wiley...

It’s no secret California is facing a housing supply crisis, and needs every tool in the shed to get more units on the market.

Among those tools are low-income housing tax credits, a federal program that helps subsidize affordable housing development up and down the state of California by leveraging private dollars in construction.

Affordable housing advocates celebrated the 2019 and 2020 budgets for including $500 million in these credits, which they said was desperately needed money to keep struggling families sheltered.

But a new report from Smart Cities Prevail, a research nonprofit focused on prevailing wage and labor standards, shows that some of these credits are “disproportionately” benefiting wealthier investors and leaving low-income workers in the dust.

To start, the study determined more subsidies than necessary are being used to fund these affordable projects. For example, $1 each in federal and state credits provides just 94 cents and 80 cents, respectively, for projects. That extra change will cost taxpayers $217 million in 2020, the report includes, “or as much as $26,700 per LIHTC financed housing unit.”

Those “extra dollars” go straight in the pocket of investors, developers and builders, said Scott Littlehale, the study’s researcher.

Worse, Littlehale added, is that construction workers, those who are more likely to need affordable housing and who actually build the projects, are unlikely to see much benefit from those credits. Construction workers will “capture” just 14% of the 2020 projects, excess credits aside, according to the study, while investors like landowners, firm owners, real estate developers and banks grab 35% of every dollar.

“The burden gets shifted from developers,” Littlehale said, “onto construction workers and taxpayers who have to foot the bill.”

Littlehale also found that the majority of LIHTC units approved in the first half of this year do not require prevailing wage standards. Instead, construction workers on these projects are generally paid minimum wage.

The project is intended to shed light on a program meant to assist the most financially vulnerable Americans, Littlehale said. But what ends up happening is construction workers, primarily those of color and who’ve been hard hit by California’s housing crunch, are largely shoved from this assistance.

“It’s to shine a light on this question of what’s the purpose again of these programs,” Littlehale said, adding that if California is going to be “all in” on LIHTC projects, future construction should be linked to labor standards. That way, the program can deliver both economic and social opportunity while solving one of California’s greatest issues.

“Policies shouldn’t reinforce inequalities and the LIHTC programs shouldn’t be exempted from that reexamination,” Littlehale said.

QUOTE OF THE DAY

“There’s no question this has been a difficult year for the people of Los Angeles. But in this moment, so many have something to celebrate. Enjoy it.”

- California Sen. Kamala Harris tweeted after the Los Angeles Dodgers clenched the World Series Tuesday night. The jubilation hit a sour note after it was discovered that third baseman Justin Turner, who had taken to the field to celebrate with teammates, tested positive for coronavirus.

Best of the Bee

• California prison officials have been telling workers to shave their facial hair in order for their N95 masks to comply with safety regulations, but some workers don’t want to. Now, a California state worker union is fighting for workers rights to their beards and protection from COVID-19. via Wes Venteicher
• Several major environmental groups, such as the Sierra Club, are urging voters to say no to Proposition 22, saying the ballot measure over the future of gig workers could stifle the state’s fight against climate change. The groups content that rideshare companies would be forced to take more responsibility for their carbon emissions if they’re compelled to pay their drivers as employees. Prop 22 would exempt them from doing so. via Jeong Park
• Orlando Truitt was on a walk to a North Highlands market in Sacramento last February when he saw a sheriff’s car pull up to a neighbor and tell him to stop walking. Minutes later, the man was on the ground with five or six deputies on top of him. Truitt, a 66-year-old retired nurse, pulled out his cell phone to record the incident. Shortly after, Pruitt found himself in handcuffs and subject to what lawyers are now arguing was an illegal search and seizure and a violation of his civil rights. via Sam Stanton

This story was originally published October 29, 2020 at 4:55 AM.