Assemblywoman Lorena Gonzalez and Sen. Ben Hueso agree on a few things when it comes to banking options in the southern San Diego communities they jointly represent.
They agree, for example, that there aren’t many. They agree that the lack of banks impacts individuals and small businesses, who can’t access capital to start new projects. They agree that this pushes many of their constituents into the arms of predatory payday lenders.
But they differ on whether the state should rein in some of those lenders’ practices, including by capping the interest rates on loans between $2,500 and $9,999.
Gonzalez is a co-author of AB 539, which would institute an interest rate cap of 36 percent on loans in that range, prohibit payment penalties and some other administrative fees and set minimum and maximum loan lengths.
Hueso was the only member of the Senate Banking and Financial Institutions Committee who declined to vote on the bill this week; six other members voted yes.
Hueso was sharply critical of the bill in a Wednesday hearing.
“If your bill passes, where are these people going to go? They’re going to go to the black market, they’re going to go to the underground economy, they’re going to go to lenders that are not regulated. Growing up, we used to have loan sharks in my neighborhood that hurt people if they didn’t pay. When someone is desperate, where are they going to go for help?” Hueso said. “It’s hard for me to ignore people that use these loans that need them. it’s hard for me to listen to them say if we take this away, they have nothing.”
Supporters of the bill think Hueso’s concerned about another group too: the lenders themselves.
A Sacramento Bee editorial noted : “After the California State Assembly resoundingly passed AB 539 by a vote of 60-4, the industry rushed to cut campaign checks to state Senators on the California Senate Banking and Financial Institutions Committee. The committee now controls the fate of AB 539.”
The most recent campaign finance statements that would show donations made after the Assembly vote won’t be made public until next month.
But available disclosures show that payday and other loan providers and their associates donated almost $24,000 to Hueso for the 2018 general election alone.
Gonzalez, for her part, also received $7,000 for her 2018 general election bid from Insikt Inc., a company that offers loans in low-income communities and bills itself as an alternative to payday loans.
When Gonzalez spoke about the bill on the Assembly floor, she said she used to believe – like Hueso does – that they were necessary for some people who couldn’t otherwise access money when they needed to. But over time, she said, she’s come to see the need for reforms.
“These stores unfortunately are preying on communities like mine where there isn’t other infrastructure. And we need to do more to bring people into our communities. We have to do more to incentivize lending in our communities – not just to individuals who are having a hard time but to folks who want to start a small business. We really need this kind of access to capital. But we have to stop what’s happening. It is just unconscionable.”
SB 330 Looms Large in San Diego Mayor’s Race
“They’re coming for our homes,” San Diego City Councilwoman Barbara Bry declared in an ominous campaign fundraising pitch for her mayoral campaign this week. “They,” presumably, are state lawmakers like Sen. Nancy Skinner, the author of SB 330, a bill that would limit new legislation intended to impede development and streamline project approvals.
She knocked her opponent, Assemblyman Todd Gloria, for voting for SB 330. The email drew sharp criticism from environmentalists and the chairman of San Diego’s Democratic Party.
As Scott Lewis pointed out this week, Bry hasn’t always been opposed  to state involvement in local land use decisions. When she was running for City Council in 2016, Bry wrote in a Voice of San Diego op-ed : “In discussing these issues, it is important to remember that the housing crisis cannot be solved entirely at the local level. Reforms in state planning laws would ensure more efficient local land use practices and simpler environmental reviews for affordable housing.”
Lawmakers Approve Data Privacy Audit
Lawmakers asked State Auditor Elaine Howle this week to open an investigation into how law enforcement agencies use automated license plate reader technology.
Sen. Scott Wiener, who introduced the proposal, said his aim was to protect residents’ privacy and ensure their information is being used properly at a Joint Legislative Audit Committee hearing Wednesday.
“When misused, this data and powerful analytics software accompanying it can be used as masked surveillance,” Wiener said.
The audit will include looking at how information collected by local law enforcement agencies is shared or can be accessed by other agencies, including U.S. Immigration and Customs Enforcement. Voice of San Diego previously found that the San Diego Police Department was sharing data  it collected through a network of cameras that scan license plates and record the date, time and GPS location of the cars that pass them with federal agencies, including Border Patrol. SDPD has since stopped sharing the data.
The audit will hone in on four agencies, not including any in San Diego.
“Whether you believe license plate readers are a useful public safety tool or not, one must recognize the need to ensure that law enforcement is acting as responsible stewards of our confidential locational data,” Dave Maass, a senior investigative researcher at the Electronic Frontier Foundation, told lawmakers Wednesday.
Assemblyman Randy Voepel, who represents Santee, did not vote for the audit and at a one point during the hearing waved his phone around, saying privacy is dead  and explaining how his wife uses his phone to track his location.
- EFF also asked the California Department of Justice this week to improve its oversight of the California Law Enforcement Telecommunications System , a system that links up multiple law enforcement databases, allowing agencies access to information they may not collect. EFF specifically highlighted a need to review the scope of federal immigration officials’ use of the database after Voice of San Diego revealed several instances where it appeared immigration officials accessed DMV information to help them track down unauthorized immigrants with no criminal history .
But Wait! More Audits!
Assemblywoman Tasha Boerner Horvath proposed two audits of the state’s higher education institutions that were approved Wednesday  after a nationwide college admissions scandal  and an audit found that California State University had been hoarding a $1.5 billion surplus .
So far, two University of California campuses have been connected to the admissions cheating scandal (and a Del Mar executive recently plead guilty to charges  related to the scandal at USC).
As a UC Berkeley graduate, Boerner Horvath said she was saddened by allegations in the scandal involving the university and thinks that although the UC system is doing its own internal audit, a state audit “can help assure Californians that the University of California is doing all it can to ensure the diversity and meritocracy that we value.”
The audit would review and assess system-wide policies regarding admission  and look at admissions for non-resident applicants and for special talent or achieved, such as artistic and athletic talent, at Berkeley, UCLA and UCSD and whether students accepted under these special criteria continued to participate in activities for which they were given special admission. The audit would also examine the relationship between the universities, the College Board, ACT and private admissions consultants.
The other audit would look at campus-based fees within the California State University system , such as “student success” fees, materials services and facility fees and student center fees. The audit would specifically focus on Chico State, Cal Poly San Luis Obispo, San Diego State and San Jose State, looking at the process for originating, approving and implementing the student fees and what systems are in place to assure they are used on what they are intended for.
Boerner Horvath noted that there were wide disparities in the fees between campuses. While tuition for the academic year for a full-time undergraduate is $5,742, she noted that at Cal Poly San Luis Obispo, these fees raised the total cost of attendance by thousands of dollars.
“It is critical that California State University provides additional transparency,” she said.
Golden State News
- Katie Orr has been doing great work illuminating California’s childcare affordability crisis. Her latest piece examines why childcare workers are paid so little even though they’re in high demand . (KQED)
- Some Uber and Lyft drivers say they were tricked or pressured into campaigning against AB 5 , Assemblywoman Lorena Gonzalez’s bill that would limit when businesses can classify workers as independent contractors. (Recode)
- Salmon fishing is booming in California . (Wall Street Journal)
- Four women, including a sitting Orange County sup
- ervisor, have accused Republican Assemblyman William Brough of sexual misconduct . Brough says it’s retaliation for “his attempts to rein in a local toll road agency.” (Los Angeles Times)
- California punk bands had an unlikely early champion : Chinese restaurants. (Topic)
- The state controller this week published updated data on the salaries of city and county employees .
- The reviews are in: Sen. Kamala Harris was the breakout star  of the Democratic debates. (NPR)
Katy Stegall contributed to this report.