5

CA17: Five statewide officials endorse Honda

Five of California’s eight statewide constitutional officers endorsed Rep. Mike Honda on Monday for re-election over Democratic challenger Ro Khanna in the 17th Congressional District.

Honda, D-San Jose, issued a news release saying he’s humbled to have the support of Attorney General Kamala Harris, Insurance Commissioner Dave Jones, Treasurer John Chiang, Controller Betty Yee and Superintendent of Public Instruction Tom Torlakson.

“I share their deep passion and commitment to solving problems facing many of California’s working families,” Honda said. “They represent the very best of what our state has to offer and I look forward to continuing my work with them.”

Harris, currently the frontrunner for the U.S. Senate seat from which Barbara Boxer will retire at year’s end, said that “from improving public safety, fighting to end human trafficking, and ensuring the civil rights of all people are protected – Mike has always been there.”

Yee said “Honda has been a tireless advocate for the people of Silicon Valley: securing funding for BART expansion, boosting critical research in nanotechnology, and fighting to ensure that every child has access to quality education.”

And Torlakson called Honda “an unwavering ally to California’s students and teachers. As a former science teacher and principal, education has always been one of his top priorities. Mike is working across the aisle to improve science, technology, engineering, and math (STEM) education in our classroom’s, which will provide our children and country with the skills to stay competitive in this global economy.”

Among the other statewide constitutional officers, Secretary of State Alex Padilla has endorsed Khanna; Lt. Gov. Gavin Newsom endorsed Khanna in 2014 but has not yet made an endorsement for 2016; and Gov. Jerry Brown endorsed Honda in 2014 but has not yet made an endorsement for 2016.

7

Chiang urges CalSTRS to divest from gun maker

California Treasurer John Chiang is concerned that the state’s teachers’ pension system still has investments managed by a firm that hasn’t kept its promise to sell off its firearm-manufacturing holdings.

This all started with the December, 2012 schoolhouse massacre in Newtown, Conn., in which a Bushmaster AR-15-type semi-automatic rifle – which fit California’s definition of an assault weapon – was used to kill 20 children and six adults. Bushmaster – along with Remington, Marlin and several other firearm brands – belongs to the Freedom Group, which in turn is owned by Cerberus Capital Management.

Bushmaster XM15

Soon after the Newtown shooting, the California State Teachers’ Retirement System (CalSTRS) issued a statement expressing concern that Cerberus – which manages some private equity funds in which CalSTRS is invested – owned Freedom Group. But Cerberus had just announced that it intended to sell Freedom Group, so CalSTRS was satisfied.

Yet Cerberus still owns Freedom Group today.

“Two years ago, I was proud to support the effort of CalSTRS to divest from assault weapon manufacturers,” Chiang wrote this week CalSTRS investment committee chairwoman Sharon Hendricks. “I am frustrated that two years have passed and the Freedom Group remains in their portfolio, indirectly financed by the pension contributions of California teachers.”

Chiang acknowledged the pension fund is obliged to find sound investments, but “it must consider how those investments may be used to finance business interests that run counter to the beliefs of CalSTRS and its members.”

“We rightly determined that there is significant risk in investing in the Freedom Group, a business that manufactures weapons that are susceptible to sanctions, regulations, and actions that could be detrimental to the fund,” he wrote, urging the CalSTRS board to do whatever is necessary to fully divest from the Freedom Group.

Chiang also asked that Cerberus’ leadership attend the CalSTRS board meeting this Friday “to explain why the Freedom Group remains in its portfolio despite agreeing to remove it more than two years ago. It is vital that Cerberus understand the strong desire of CalSTRS, its Board, and teachers in California, that none of its funds be used to fund the manufacturing of weapons used to commit such terrible atrocities.”

4

State oversight avalanche bears down on ABAG

State officials are rushing to put new oversights in place following the embezzlement of almost $1.3 million by an Association of Bay Area Governments official from a bond-funded San Francisco development account.

State Treasurer John Chiang on Thursday announced a partnership with Senate President Pro Tem Kevin de León, D-Los Angeles, to conduct legislative oversight hearings to make sure money raised through government bond sales is safe from fraud, abuse, and mismanagement. Chiang also said he has created a special task force to develop best-practices guidelines on the care of bond proceeds that will be issued to all state and local governments.

California and its local governments over the past decade have issued more than $700 billion in public debt, Chiang noted in a news release.

“We rely on these borrowed moneys to build and maintain the critical infrastructure upon which our communities and economy depend – from schools and roads to levees and libraries,” Chiang said. “The ease in which one of ABAG’s leaders allegedly fleeced more than a million dollars in bond funds raises concerns regarding whether there are sufficient safeguards at the thousands of State and local agencies which are responsible for nearly three-quarters of a trillion bond dollars.”

And state Controller Betty Yee announced Thursday her staff will audit ABAG’s internal administrative and accounting controls.

“As California’s chief fiscal officer, I am charged with protecting state resources,” Yee said. “When public money goes missing, I need to determine how it happened and whether effective controls are in place.”

Yee’s audit will initially focus on FY 2012-13 and 2013-2014, but that might expand if investigators discover accounting weaknesses that may have affected earlier years. The Controller’s Office sent a letter today to ABAG asking that the association make available documents that will be used in the audit including ledgers, contracts, invoices, personnel records, meeting minutes, policies and procedures. The audit work will begin Feb. 20 and is expected to take a few weeks.

More, after the jump…
Continue Reading

8

No love for GOP in statewide race finance reports

Republicans are taking a drubbing in trying to raise money for California’s statewide elections, according to campaign finance reports that were due Monday.

Monday was the deadline to file reports for Jan. 1 through March 17, and there wasn’t much good news for the GOP. That might not be surprising, after state GOP Chairman Jim Brulte said recently that statewide races won’t be a priority for his party this year, given that only a few are even competitive (and he wouldn’t say which ones).

Even gubernatorial contender Neel Kashkari seems to have ended his honeymoon with contributors early. Though he said in February that he had raised $976,000 in his campaign’s first two weeks, the report he filed Monday indicated he has raised only about $1.34 million total so far – a signficant slowdown after that first burst, and a pittance next to incumbent Gov. Jerry Brown’s $19.7 million war chest.

So, here’s a sampling of how it’s shaking out as of now; all figures below are as of March 17, and I’ll be updating as reports come in.

Governor
Jerry Brown (D)(i) – $19,747,924 cash on hand; $0 debt
Neel Kashkari (R) – $903,478 cash on hand; $93,807 debt
Laguna Hills Mayor Andrew Blount (R) – $8,184 cash on hand; $19,832 debt
Assemblyman Tim Donnelly (R) – $10,766 cash on hand; $149,068 debt

Lt. Governor
Gavin Newsom (D)(i) – $1,915,093 cash on hand; $30,315 debt
Ron Nehring (R) –
George Yang (R) –

Attorney General
Kamala Harris (D)(i) – $3,164,966 cash on hand; $5,044 debt
Ronald Gold (R) –
John Haggerty (R) –
David King (R) –
Phil Wyman (R) –

Secretary of State
state Sen. Alex Padilla (D) – $614,426 cash on hand; $73,900 debt
state Sen. Leland Yee (D) – $134,556 cash on hand; $48,088 debt
Derek Cressman (D) – $77,317 cash on hand; $192,781 debt
Pete Peterson (R) – $1,638 cash on hand; $84,913 debt
Dan Schnur (NPP) – $260,441 cash on hand; $64,390 debt

Controller
Assembly Speaker John Perez (D) – $1,792,681 cash on hand; $6,089 debt
Brd of Equalization member Betty Yee (D) – $100,530 cash on hand; $35,672 debt
David Evans (R) –
Fresno Mayor Ashley Swearengin (R) –

Treasurer
Controller John Chiang (D) – $2,037,770 cash on hand; $376 debt
Greg Conlon (R) –

Insurance Commissioner
Dave Jones (D)(i) – $1,578,714 cash on hand; $1,777 debt
State Sen. Ted Gaines (R) – $32,000 cash on hand; $12,451 debt

Superintendent of Public Instruction
Tom Torlakson (i) – $581,588 cash on hand; $4,624 debt
Marshall Tuck – $454,600 cash on hand; $65,668 debt
Lydia Gutierrez – $6,163 cash on hand; $21,865 debt

8

Assembly Dems to take aim at CalSTRS liability

Assembly Democrats say they’re ramping up an effort to solve the long-term, crushing unfunded pension liability in the California State Teachers’ Retirement System (CalSTRS).

“The Assembly will pursue a solution to the STRS shortfall this legislative session,” Speaker John Pérez, D-Los Angeles, said at a news conference today in Sacramento. “Further delay only means further cost and further exposure for the state’s general fund. We believe there must be shared responsibility for a funding solution between school districts, the state and teachers. Our end goal is a State Teachers Retirement system that is 100 percent fully funded.”

Assemblyman Rob Bonta, D-Alameda, said the Assembly Public Employees, Retirement and Social Security Committee he chairs will start holding hearings next month.

“I am eager to begin this process and confident that an equitable and permanent solution can and will be found to the CalSTRS funding problem,” he said. “Ensuring the long term financial security of California’s hardworking and dedicated teachers is a goal we are hopeful we can achieve this year.”

As Jessica Calefati reported Sunday, CalSTRS’ unfunded liability is around $80.4 billion and constitutes a huge chunk of the looming costs threatening the state’s long-term fiscal health.

State Treasurer Bill Lockyer and Controller John Chiang, both of whom serve on CalSTRS’ governing board, immediately welcomed the lawmakers’ call to action.

Perez and Bonta “are spot-on in calling for immediate action and shared sacrifice in addressing CalSTRS’ unfunded liability gap during the coming year,” Chiang said in a news release. “If lawmakers can meet the challenge with courage and fiscal prudence today, Californians can avoid a risis tomorrow that imperils not only teachers, but taxpayers and the education system in which they have entrusted our children’s future.”

It’ll be interesting to see how the state’s teachers’ unions buy into this (or don’t) especially regarding Perez’s call for “shared responsibility” including teachers.

The CalSTRS shortfall “does not have to be paid overnight,” the California Teachers Association states in its retirement position paper. “Like a mortgage, this is an amount that will need to be closed over a 30-year period. The shortfall has to be addressed, and teachers are committed to partnering with CalSTRS in finding a long-term funding solution.”

0

Drug charges against Nadia Lockyer dismissed

An Orange County judge dismissed drug charges Friday against former Alameda County Supervisor Nadia Lockyer, wife of state Treasurer Bill Lockyer, according to reports from the Associated Press and Los Angeles Times.

OC weekly coverA court spokeswoman told the AP the charges were dropped at prosecutors request; the Times reports she agreed to attend a drug diversion program.

Lockyer early in 2012 had claimed Stephen Chikhani attacked her in a Newark hotel room, but the state Justice Department investigated and eventually declined to charge him with any crime. As details emerged about Lockyer’s lengthy affair with Chikhani and their drug use, she resigned her supervisorial seat in April 2012.

Bill Lockyer filed for divorce a few months later, citing “irreconcilable differences” and seeking joint physical and legal custody of their son. Then Nadia Lockyer was arrested in August 2012 in Orange County and charged with felony methamphetamine possession and three misdemeanors: being under the influence of a controlled substance, possession of drug paraphernalia, and child abuse and endangerment. She spent several months in a residential rehabilitation program and has been under court supervision ever since.

Nadia Lockyer also was the subject of a lengthy cover story in this week’s OC Weekly.