Sacramento Report: Coronavirus Hearing Highlights Budget (and Tech) Challenges to Come

Government

Sacramento Report: Coronavirus Hearing Highlights Budget (and Tech) Challenges to Come

The state Senate’s website crashed as viewers tried to watch a special hearing vetting coronavirus spending, highlighting the fiscal and technical challenges ahead as the pandemic continues.

Image via Shutterstock

COVID-19 will be with us for a long time. Even after officials get a handle on the immediate public health emergency, the long-term impacts on budgets and services from the state on down are likely to be extreme.

Consider this: The Great Recession technically ended in June 2009 but affected California budgets well into 2012.

To help get a grasp of how the state is responding to the crisis, Senate President Pro Tem Toni Atkins announced the creation this week of a Special Committee on Pandemic Emergency Response. It’ll be vice-chaired by Sen. Patricia Bates, and Sen. Brian Jones will serve as a member.

In the meantime, lawmakers began returning to the Capitol Thursday for a special subcommittee hearing on COVID-19-related spending. At 2 p.m., just as the hearing was expected to start, the Senate website crashed. On Twitter, Atkins cited “technical difficulties due to the overwhelming number of visitors.”

Once the hearing got off the ground, Sen. Holly Mitchell, the budget committee chair, said her intention was to kickstart the Legislature’s role as an oversight body. Gov. Gavin Newsom’s advisers estimate that the state’s initial efforts to combat the coronavirus will total at least $7 billion.

Whether it’s even possible yet to take a full accounting of that money is unclear, because things are still moving fast.

In practice, the hearing served as an opportunity for finance officials and experts to answer initial questions about how those funds are being allocated — here’s an official summary. The stats and figures tossed out Thursday nearly all suggested that the state budget is gonna be screwed for a long time.

For now, state revenues are expected to come up short $35 billion in this year alone, and there could be an additional $85 billion shortfall after that. The unemployment rate brought by COVID-19 could exceed the 12 percent unemployment rate brought by the Great Recession a decade ago.

There was also an acknowledgement among officials that the federal government’s response will be crucial to California’s recovery because the federal government can run deficits and sets deadlines on interest loan repayments.

“The stimulus bill passed by Congress, even at $2.2 trillion, is really not enough to address our needs given the scale that we as well as other states across the country are facing,” said Vivek Viswanathan, chief deputy director for the state Department of Finance.

Jesse Marx

Bry Goes in on AB 5; Gonzalez Details Changes for Musicians

Assemblywoman Lorena Gonzalez is pressing ahead with changes to AB 5, the landmark law passed last year that limits when employers can classify workers as independent contractors.

On Friday, she unveiled details about legislation that will change and clarify how the law applies to musicians, which she said will be introduced when the Legislature reconvenes from its coronavirus hiatus.

In a statement, her office said the changes will preserve the rights of individual artists, engineers, producers, songwriters, composers, etc. to collaborate with one another “without application of the ABC test” and will allow for collaboration during live performances in certain cases without the test applying.

But for certain types of musicians whose performances are regularly consistent and controlled by a hiring entity – groups that perform consistently at theme parks, symphony and orchestra members, those performing as part of a tour or live theater production – the test laid out in AB 5 and the state Supreme Court’s Dynamex decision will continue to apply.

Meanwhile, San Diego City Councilwoman Barbara Bry is running for mayor of San Diego but continues to focus her campaign messages on state government efforts she believes are misguided.

Her campaign kicked off by rallying residents against SB 50, the effort to allow taller, denser home-building near transit.

Now, she’s pivoted to criticizing AB 5.

In three separate campaign messages this week, Bry took aim at the law.

In a Monday email, she lambasted legislators for codifying a “decades-old court ruling” into law. (Dynamex was decided in … 2018.)

“I think it’s incredible gross that [Bry] is using this pandemic to lie about what the state of CA is doing about UI & independent contractors,” Gonzalez tweeted in response.

In a Wednesday email, Bry wrote that “the gig workers who the Supreme Court and AB5 sought to protect were worse off than they were before the court acted.”

The next day, she applauded the governor’s executive order allowing independent contractors to seek pandemic relief funds without first filing a claim arguing they were misclassified by an employer. That same order, though, took pains to praise AB 5 and Dynamex.

The state announced a new website coming later this month that will allow independent contractors to seek unemployment benefits.

Sara Libby

Advocates Say Relief for Undocumented Immigrants Is Just a First Step

Gov. Gavin Newsom announced a $75 million disaster relief fund to support unauthorized immigrants in the state, who are not eligible for unemployment benefits and other relief, including what is provided under the CARES Act.

Approximately 150,000 undocumented adult Californians will receive a one-time cash benefit of $500 to deal with needs arising from the coronavirus pandemic. There will be a $1,000 cap per household.  People can start applying for the support next month. The funds will be dispersed through regional nonprofits that work with immigrant communities.

Grantmakers Concerned with Immigrants and Refugees, a network of foundations focused on immigrant issues, has committed to raising an additional $50 million to support direct financial assistance to families of undocumented immigrants on top of the state’s $75 million.

“We are grateful for the governor’s initial $75 million commitment by the state and the announced $50 million commitment in private funding, but we know that the hundreds of thousands of undocumented taxpayers and their citizen children deserve the same protections as all other Californians,” said Assemblywoman Lorena Gonzalez, who is chairwoman of the Latino Legislative Caucus, in a statement. “We thank the governor for this first step. We appreciate having the most forward thinking executive in the country and we will continue to protect all Californians, together.”

At the end of March, members of the Latino Caucus send Newsom a letter laying out several policies the state could adopt to provide emergency funding, tax credits and health care to immigrants living in California without legal status.

The first suggestion was the disaster relief fund. The second was to remove the prohibition on immigrant tax filer for the California Earned Income Tax Credit. The third was to extend Medi-Cal benefits to all low-income unauthorized adult immigrants.

There are approximately 170,000 unauthorized immigrants living in San Diego, according to the Pew Research Center. On Wednesday, Newsom said that unauthorized immigrants had paid $2.5 billion in local and state taxes last year.

While advocates applauded the move, they indicated that there is still much more to be done. The $125 million will likely only be sufficient to assist a fraction of the state’s more than 2 million unauthorized immigrant population. The one-time emergency grant is also a far cry from the monetary support that unemployment insurance provides.

“Undocumented immigrants are valued members of our community and they should have been included in all supports and services before and during this crisis,” said Kyra Greene, executive director of the Center on Policy Initiatives in San Diego, in a statement. “This initiative is a step in the right direction, but it is not enough.”

Maya Srikrishnan

Golden State News

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