Good morning, California.
“[F]ederal judges are appointed for life, not for eternity.” — U.S. Supreme Court, reversing a U.S. 9th Circuit Court of Appeals decision on equal pay because the opinion, written for the 6-5 majority by Judge Stephen Reinhardt, was announced on April 9, 2018, 11 days after the famed liberal jurist’s death.
Read all about it: Dems propose tax cuts
Tax cuts for cannabis and newspapers could be on their way.
Lower taxes on marijuana, tampons, diapers and newspapers are among a variety of state finance proposals from California’s dominant party.
Most closely watched: a cannabis tax trim introduced by Democratic Assemblyman Rob Bonta of Oakland, as detailed in The Sacramento Bee.
- Legal weed sellers say they need the tax break because they’re being undersold by illegal dealers.
- Given the growing clout of the marijuana lobby, expect that bill to get a favorable look.
Most, er, newsworthy: Assemblyman Marc Levin, a Marin County Democrat, has introduced legislation to eliminate the sales tax on newspapers and magazines.
- Gov. Pete Wilson pushed to raise the tax on newspapers in 1991 at the start of his administration, as part of a sweeping tax hike when the state faced a huge deficit.
- Wilson reversed most of the tax increases when the economy recovered. But one that remained was the sales tax on newspapers, which came only in paper form in those days.
Get ready to pay tax on online sales
A new bill brings more sales taxes to online shoppers.
Expect sales taxes on all virtually items sold over the Internet, under legislation that cleared its first hurdle Monday.
- California would follow 33 other states in implementing a U.S. Supreme Court decision, South Dakota v. Wayfair, that authorized states to levy sales taxes on online sellers.
- Sellers who gross $500,000 or more would be required to collect and remit sales taxes. The bill is by Assemblywoman Autumn Burke of Los Angeles and Sen. Mike McGuire of Healdsburg, sponsored by Treasurer Fiona Ma.
To be determined:
- Whether online retailers should have to remit taxes on past sales. They’re lobbying against any such requirement and Burke said Monday the issue of retroactivity would be dealt with in a separate bill.
- Whether plaintiffs’ attorneys should have the right to sue on behalf of consumers if retailers over-collect sales taxes.
The bill is on a fast-track and could be enacted by April 1. Without the legislation, the California Department of Taxation and Fee Administration could begin requiring out-of-state online retailers with $100,000 or more in in-state sales to register and begin collecting taxes.
- The goal is not small fry, but rather online retailers who make tens and even hundreds of millions in sales in California, including sellers based offshore.
One tax CA won't increase
The state's levy on wine, beer and spirits is America's lowest.
State lawmakers this year have introduced new or higher taxes on soda, water, batteries, oil, dialysis clinics, concealed weapons permits, bullets, and more.
- But one tax hike is unlikely: California’s levy on wine, beer and spirits, which is the lowest in the U.S.
Alcohol taxes haven’t increased since 1991 in California. That was during a recession when the budget was hemorrhaging. Several legislators have tried, without success.
- Democratic Sen. Jim Beall of San Jose tried in 2010 to add a dime a drink to alcohol fees to generate $1.4 billion a year for alcohol-related services, but the bill didn’t get out of its first committee.
- That same year, the wine, beer and liquor industry spent $1.7 million to help pass an initiative requiring a two-thirds vote to approve any new fees.
- And then-San Francisco Mayor Gavin Newsom vetoed a local measure to raise liquor fees to fund pay alcohol-related costs.
Alcohol’s toll in California was $38 billion annually then in lost productivity and costs for healthcare and criminal justice.
- Booze still results in 10,000 premature deaths a year in this state, the Centers for Disease Control and Prevention says.
Beall: “Alcohol has a bottomless pit of lobbyists. If I proposed an alcohol tax today, it would be the full employment act for lobbyists.”
Right to privacy, right to sue
Tech companies who misuse private info may soon be more easily sued.
Suing tech companies that misuse or improperly sell private information would be easier for Californians under legislation announced Monday.
- Attorney General Xavier Becerra added his clout by hosting a press conference at the Department of Justice in Sacramento with the bill’s author, Democratic Sen. Hannah-Beth Jackson, of Santa Barbara.
Jackson: “Our privacy has been taken from us. It is time we take it back.”
Jackson’s bill would amend the California Consumer Privacy Act, approved by lawmakers last year. It’s among several proposals that would variously strengthen or weaken aspects of the landmark law.
- Significant measures would need to go through the Senate Judiciary Committee, chaired by Jackson.
Bloomberg: Industry advocates see the right-to-sue amendment as an unnecessary complication to an already intricate law that survived detailed negotiations on enforcement mechanisms before it was passed last year. It already includes a narrow right for consumers to sue over data breaches.
- Significance to lawyers: Misuse of one individual’s information might not amount to huge damages, but the legislation would open the way for class action lawsuits and the potential of treble damages.
What’s ahead: Business groups will go all out to kill the provision allowing for a broader right to sue over the sale or misuse of private information. Congress is preparing to weigh in, in ways that could preempt state laws.
At last, timely disclosures for lobbyists
New bills aim to provide lobbying transparency.
Lobbyists and their employers are required to disclose the bills they work on and amount of money they spend—but only once per quarter. The quarterly reporting requirement is a vestige of a law passed in 1974, before computers and the Internet became things.
- As a result, the public has no clue about the level of spending for and against bills until the fights are faded memories. Some of us who track lobbying, including your correspondent here at What Matters, have complained.
Those complaints were heard by Assemblyman Kevin Mullin, a Democrat from South San Francisco, who has introduced legislation requiring that lobbyists and their employers file public reports once a month.
- Separately, Mullin has introduced legislation, the Issue Ad Disclose Act, which would require real time disclosure when advocacy groups spend money on ad campaigns involving specific bills intended to sway legislators’ votes. Well-heeled interest groups increasingly use the tactic.
Expect lobbyists to get worked up about both measures, which would tweak the voter-approved California Political Reform Act and require approval by two-thirds votes in both houses of the Legislature.
Mullin: “The public ought to know how money moves during the session.”
Commentary at CALmatters
A faster-speed rail is one approach to the high-speed rail project.
Jim Gonzalez, former San Francisco supervisor: Technology exists today to employ faster-speed rail service as soon as the tracks, right of way, and system controls are in place. This would be the most cost-effective approach toward making the Central Valley portion of the high speed rail project fully operational.
Dan Walters, CALmatters: Are “gerrymandering” and “ballot harvesting” unethical political practices? It often depends on who’s doing them.
Please email or call with tips, suggestions and insights, [email protected]
See you tomorrow.