California's environmental litigation is a job killer

Posted by Dorothy Rothrock, Sr. Vice President, Government Relations on Nov. 23, 2011

For those who doubt that litigation risk in California is a job killer, I recommend that you read a November 14 piece in the Los Angeles Times, “Firms turning to environmental law to combat rivals.”

This blog will serve as my public letter to the editor. The one I sent was not placed.

Here's a portion of the article:

Environmental advocates say the focus on why groups use CEQA is misplaced. "You shouldn't really be looking at motivations of petitioners," said Doug Carstens, an environmental lawyer in Santa Monica who often files CEQA complaints. "Even if it's a solely economically motivated actor, if they're promoting transparency, good government, why not?"

It’s shameful that a California lawyer endorses the idea that lawsuits to enforce environmental laws can be “solely economically motivated.” The impact of this goes way beyond the sheer number of lawsuits and the size of awards and settlements - Companies spend uncounted millions to protect themselves against such litigation, with no environmental benefit. These are dollars that could be spent on expansions, modernization, and innovation to create new jobs.

The evidence is in – we are losing investment and employment to other states that are not hindering employers with costly litigation. Data from Site Selection Magazine shows that California is among the worst in the country in new manufacturing facilities and expansions, averaging only two percent of the country's new growth in the last decade.

Further, a recent study, commissioned by City Journal, used the National Establishment Time Series database to reveal the scope of California's problems -- "snuffed-out start-ups, unproductive big cities, poorer jobs, and tinier, weaker, or fleeing companies." One key statistic from the study: California had a net loss of 260,000 jobs from start-ups and closures in the last decade. In the 90's, we had a net gain of 776,000.

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California lost another 1,500 manufacturing jobs in November: Time for job creation 101

Posted by Dorothy Rothrock, Sr. Vice President, Government Relations on Dec. 20, 2010

On Friday we learned that California lost another 1,500 manufacturing jobs in November and that our overall unemployment is second worst in the country.

California Assembly Speaker John Perez showed his concern in his "welcome" speech to our new Legislature two weeks ago and said that increasing jobs for Californians is the main solution for the budget crisis.

We agree. But he didn’t take the time to describe what it takes to create a job. Let’s not assume that everyone knows.

Job Creation 101 - What creates a job? First you need an entrepreneur with an idea for a new or better way to do things, who can find someone to accomplish the work. Then the entrepreneur must develop and sell the product or service for more than the wages paid and other costs.

Do we have what it takes to create new jobs in California? Let’s break it down:

1. A good idea for new products or services

No shortage here – California is bursting with talent and innovation. We boast huge numbers of patents, venture capital investments and small business start-ups. But we are not alone. Other states and nations are getting better at this.

2. Market demand for the product or service

California is a large market with international reach – an ideal place for market research, to conduct early commercialization and connect with suppliers. Other locations are also favorable with greater ease of travel, communications, etc. The “flat earth” is lessening our advantage in this area.

3. Predictable costs of operation and ability to maintain or grow facilities

This is one area where California falls drastically short. The regulatory and tax environment is uncertain and punitive. Entrepreneurs justifiably fear that costs and taxes will go higher with little regard to impact on job creation. This is often reflected in surveys of CEOs and site selection managers. We are famous for long and uncertain timelines for licensing and permitting facilities. A businessowner recently summed it up perfectly: "It is not about a single regulation. It is about an attitude of no respect or concern for business of any kind in this state."

4. Total costs of operations, wages, and taxes are less than the price of the product or service

Another black mark for California. Costs for manufacturers are 23% higher than the national average, for example. Taxes are at the high end compared to other states. Wages are competitive, but taxes, workers' compensation, and other costs associated with each employee is high. Electricity costs 50% more than the national average. The ability to raise prices to overcome the higher costs is lower due to flat earth dynamics.

5. Access to workers with the skills that are needed to accomplish the work to be done

California once had a world-class education system but we are sadly seeing this decline. Other states and nations are catching up. Manufacturing job creation is particularly hurt by the drop in career and technical education in the public schools. Two decades ago, 75 percent of our high school students enrolled in vocational courses, now barely 30 percent. Housing is also expensive in California, putting upward pressure on wages and discouraging qualified workers from moving to California.

6. Adequate public infrastructure to support commerce and operations (energy and water supply, transportation, etc.)

A troubling area for California. Budget deficits make it more expensive to borrow for public infrastructure and taxpayers are less likely to support new bonds while deficits and taxes are too high. The prospect of higher costs in the future to pay for crumbling infrastructure will dampen enthusiasm for new job creation in California.

Looks like we come up short in some critical areas. CMTA looks forward to working with Speaker Perez and his colleagues to address these concerns and add the jobs we need to bring California back in the black.

To fully understand the need for Job Creation 101 in California, have a look at the country's 14 most unemployed regions.

In 2011, every bill in our State Legislature should work toward improving one or more of these policies for job creation.

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Climate change causes some to rethink nuclear power

Posted by Dorothy Rothrock, Sr. Vice President, Government Relations on Dec. 10, 2007

It would have been unthinkable just two years ago.

The Senate Energy, Utilities and Communications Committee is conducting an informational hearing today in San Diego on the status of nuclear energy, which by itself is nothing new. But what is so different this year is that in addition to discussing nuclear waste, seismic safety and utility management of the state’s two nuclear plants, the committee will also discuss the role nuclear power plays in reducing greenhouse gases. In other words, nuclear power may have a future after all.

Committee chair Christine Kehoe (D-San Diego), while not exactly a champion of nuclear power, says it is time to reexamine our state’s energy portfolio. "We're not going to meet our greenhouse gas emissions goal unless we start taking some major steps to find cleaner ways to produce the tremendous amount of energy we need."

Once Taboo, Nuclear Power Experiences Renaissance in California:
http://www.voiceofsandiego.org/articles/2007/12/03/news/01nuclear120307.txt

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Don't let legal challenges interfere with AB 32 goals

Posted by Dorothy Rothrock, Sr. Vice President, Government Relations on Aug. 8, 2007

The state budget has not been finalized, in part because many Senate Republicans want to resolve the growing problem of challenges under California Environmental Quality Act for greenhouse gas emissions analysis and mitigation. We don't know how legislators and the Governor will settle the matter, but the problem is real and urgent.

CMTA and other associations involved in the AB 32 Implementation Group are interested in seeing that California's landmark law to cap greenhouse gas emissions is appropriately implemented. That includes developing regulations between now and 2012 that will cover emissions up and down the state. The challenge is that AB 32 directs the California Air Resources Board -- the state's air quality experts -- to develop the greenhouse gas reduction plan based on cost-effectiveness and technological feasibility. In addition, regulations must be developed out in the open with public hearings, testimony from all stakeholders and the deliberative process that California requires of all major regulations.

As provided in AB 32, we want CARB to develop greenhouse gas regulations before we impose, under authority of CEQA, project-by-project requirements that could delay or stall manufacturing, major infrastructure and housing projects. Of course, all other requirements of CEQA would remain in place and be complied with pending regulations or guidelines for greenhouse gas emissions. No rules or guidelines now exist in CEQA for how to conduct greenhouse gas emission analyses for public and private projects. As important as climate change policies are, we should take the time to do it right as provided by AB 32.

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4th post from Energy conference: LNG siting challenges a sign of the times

Posted by Dorothy Rothrock, Sr. Vice President, Government Relations on July 27, 2007

From William Booth, counsel for the California Large Energy Consumers Association:

Recent experience on the siting of liquefied natural gas terminals is "emblematic to California's approach to infrastructure and it isn't good."

"Two of the proposed LNG projects--one onshore, one offshore--were turned down, not going to happen. Both have gone to inordinate lengths to deal with envionmental issues. The opposition is fierce, organized and relatively sophisticated."

Decisionmakers, Booth said "are going to need to step up," adding, "We shouldn't let Malibu determine state energy policy."

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