Capitol Alert AM Newsletter

Final hurdle for anti-fracking bill + Ending sales tax breaks for warehouses

Hydraulic fracturing is currently used on between 10% to 20% of all oil and gas wells on public lands in Central California managed by the Bureau of Land Management Bakersfield Field Office. The BLM is in the process of reviewing the proposed environmental impact of fracking on new oil and gas leases.
Hydraulic fracturing is currently used on between 10% to 20% of all oil and gas wells on public lands in Central California managed by the Bureau of Land Management Bakersfield Field Office. The BLM is in the process of reviewing the proposed environmental impact of fracking on new oil and gas leases. Bureau of Land Management Bakersfield Field Office

Good morning, California! We’re a mere four days from session’s end.

Senate gavels in at noon, the Assembly an hour later.

‘THIS LAND IS YOUR LAND’

A bill to prohibit new leases for oil and gas drilling on federal lands in California could be on the Assembly floor today for a vote on yet another effort by Democratic lawmakers to fight President Donald Trump’s environmental policies.

The Senate approved the measure with two votes to spare on a 23-9 margin last week, despite last-minute lobbying from the oil industry.

Relevant — The Trump administration announced earlier this year that it would open up nearly 1 million acres of federal land in California in the Central Valley and along the Central Coast to allow for more fracking of oil and gas. The decision ended a five-year freeze since the federal government last issued new fracking leases.

“The Trump administration has clearly demonstrated their desire to pursue aggressive energy policy with devastating impacts on our most beautiful lands,” said bill author Al Muratsuchi, D-Torrance. “We see this happening in other parts of the country and California is not going to sit idly by. We are going to fight back.”

Republicans representing the Central Valley, which would be more directly affected by both Trump’s effort, said the California bill would push the lucrative oil industry out of the Golden State and economically harm Californians.

“If we think this through, this could have dire consequences and completely run out folks in the fuel industry,” said state Sen. Andreas Borgeas, R-Fresno. “If they’re abiding by the rules and extracting in conformity with our safety protocols and environmental concerns, we’re punishing them and pushing them out of business.”

California Controller Betty T. Yee backs the bill, and Muratsuchi said he’s worked with state agencies that have a stake in the outcome, i.e. the Department of Parks and Recreation and the State Lands Commission, to earn their support.

TBD on the governor, however.

“Whether we’re talking about Yosemite National Park, or the (Giant) Sequoia National Monument, Muratsuchi said. “We’re optimistic that Gov. Newsom will recognize this as another opportunity to fight back against Trump to protect our most beautiful protected lands.”

TAX (UN)BREAKS

Gov. Gavin Newsom has a bill on his desk that, with his signature, would ban city tax deals that benefit major online corporations.

Senate Bill 531, backed by the League of California Cities, would prohibit local jurisdictions from funneling tax revenues to online retailers in exchange for their physical location in the district.

Companies can leverage their ability to send local sales tax to a warehouse, distribution center or other brick-and-mortar building in exchange for additional breaks from cities.

As a result, state Sen. Steven Glazer, D-Orinda, said that companies “profit doubly” by the agreement, because they’re allowed to keep “both the funding from their retail sales, and the public funds siphoned to them as a rebate.”

“Current tax law has created an environment that puts the power to allocate local sales tax into the hands of online retailers,” Glazer said, as noted in the bill analysis. “California cities are sending an estimated $1 billion in taxpayer dollars back to giant corporations each year – at a time when state and local governments are scrambling to fund public safety, roads, affordable housing, and tackling the homeless crisis.”

After first failing to pass the Assembly floor on a 36-21 vote in late August, the measure secured a 48-21 count on Thursday, thus sending it to Newsom’s desk. Several Democrats voted against the bill, with many more not voting at all.

Bloomberg BNA in June reported that a sales tax swap the city of Cupertino gave to Apple in 1997 returned at least $70 million to what is now the world’s second-most valuable company.

Other communities, including Sacramento County, have used the tax agreements to lure warehouses for online retailers.

Just two cities went on the record opposing Glazer’s bill. Fresno and Perris, argued the deals help attract business to their communities.

“In the end, if SB 531 is approved, Fresno will lose a key tool in its economic development arsenal,” Fresno Mayor Lee Brand wrote in an op-ed for The Bee in July. “And it will continue a California narrative where the rich get richer and the poor get poorer.”

OFF TO THE RACES

It’s official.

The primary votes for Assembly District 1 have been tallied and released by the Secretary of State’s office on Friday.

And so it boils down to:

Democrat Elizabeth Betancourt, with 38.6 percent, or 35,167 votes and Republican Megan Dahle, with 35.6 percent, or 32,427 votes.

The general election for the vacant seat is scheduled for Nov. 5, 2019. The spot was left open after now state Sen. Brian Dahle (Megan’s husband) won his Senate District 1 seat against Assemblyman Kevin Kiley, R-Rocklin, in June.

HAPPY BIRTHDAY!

September 8 — Assemblyman Freddie Rodriguez, D-Pomona

Best of The Bee:

Hannah Wiley joined The Bee as a legislative reporter in 2019. She produces the morning newsletter for Capitol Alert and previously reported on immigration, education and criminal justice. She’s a Chicago-area native and a graduate of Saint Louis University and Northwestern.
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