Image via iStock

Good morning, California! It’s Monday, April 5.

I’m CalMatters politics reporter Ben Christopher, filling in for Emily Hoeven, who is enjoying a much-deserved week off.

A “gold rush” amid the calamity

This much is not news: California’s Employment Development Department, the state agency responsible for shelling out unemployment claims to millions of jobless Californians, is still a mess

But as CalMatters’ Lauren Hepler reports, that year-long mess has been very lucrative for a handful of tech companies and consulting firms

Since the beginning of the pandemic, the department has spent $236 million on contract workers, software upgrades and other patches to its overburdened and frayed system. With a little digging, Hepler found that nearly half of that — $103.8 million — went to just five vendors, some in the form of no-bid contracts.

The international consulting giant Deloitte has been the biggest beneficiary, taking in at least $69 million.

The contract bonanza is part of a “nationwide unemployment gold rush,” as companies have rushed to the rescue of public agencies unable to meet the unprecedented demand for unemployment assistance — and a surge in fraudulent claims.

At last count, 150,658 Californians have spent at least three weeks waiting for their payment. Another 906,744 claims are pending verification. 

  • John Coss of Thomson Reuters, which was awarded contracts totaling $4.2 million to help ferret out fraud: “States have been passed, and they’re outgunned by these fraud networks now. I just don’t think it’s possible to do it purely with staffing.”

What’s the state getting for all this spending?

According to the department, a lot. For example: The $9.5 million that went to the digital ID verification company, ID.me, has helped thwart $60 billion in fraud, said spokesperson Aubrey Henry.

Meanwhile, unemployed Californians including 46-year-old mother of three Stacy Lira are still having to play the role of “unemployment detectives.” Lira has spent countless hours on hold with the department every day to try to get the nearly $20,000 owed to her family unlocked. 

In February, Lira was diagnosed with COVID-19. Struggling to breathe, she was rushed to the hospital — but not before grabbing her unemployment records so she could keep calling from her bed.

  • Lira: “That day in there at the hospital, I almost wanted COVID to take over.”

______________

The coronavirus bottom line: As of Sunday, California had 3,580,351 confirmed cases (+ %0.1 from previous day) and 58,513 deaths (+0.2% from previous day), according to a CalMatters tracker.

California has administered 19,717,651 vaccine doses and 7,260,337 people are fully vaccinated..

Plus: CalMatters regularly updates this pandemic timeline tracking the state’s daily actions. We’re also tracking the state’s coronavirus hospitalizations by county and lawsuits against COVID-19 restrictions.


A Message from our Sponsor


1. Party like it’s 2019

Image via iStock

It might be a while longer before California life gets back to its pre-pandemic normal. But things are getting a little bit normal-er every day. 

On Friday, the federal Centers for Disease Control and Prevention gave fully vaccinated Americans the green light to hop on a plane, bus or train — with a mask on. The new guidance is based on mounting evidence that people who have been fully vaccinated and wait the recommended two weeks for immunity are much less likely to catch or transmit the coronavirus.

Also on Friday, the California Department of Public Health announced a series of new tweaks that further loosen reopening rules:

  • Indoor concerts and other performances will soon be allowed in counties where COVID-19 is not “widespread.” (Right now, that’s all but three).
  • Ditto for conferences, weddings and other gatherings, with attendance capped between 100 and 200 depending on the county.

The new rules go into effect on April 15. But there are conditions. And not everyone is going to like them. 

Large indoor events, for example, will only be “allowed if all guests are tested or show full proof of vaccination.” 

That’s sure to fire up what has already been a fiery debate around “vaccine passports” and the divide between the vaccine-haves and have-nots. But being able to attend weddings, go to concerts and spend a little bit less time on Zoom is yet another enticement for the vaccine-hesitant to go get that jab. Which might be the point. 

2. Pass the SALT?

Gov. Gavin Newsom; President Joe Biden. Photos by Anne Wernikoff, CalMatters; Gage Skidmore via Flickr

Late last week, Gov. Gavin Newsom joined five other blue state governors to ask President Biden to bring back one of coastal liberal America’s favorite tax breaks. 

For as long as the federal income tax has been around, taxpayers have enjoyed the ability to write off their state and local tax payments from their federal tax bill. That deduction has disproportionately benefited Democratic states and Democratically-controlled cities, which tend to have higher taxes. 

But in 2018, Republicans in Congress passed the Tax Cuts and Jobs Act, the signature legislative accomplishment of the Trump era, capping the amount that can be written off at $10,000 per year.

Now that Biden is mulling over a massive new infrastructure bill, Newsom and the governors of New York, New Jersey, Connecticut, Oregon and Hawaii want him to pop off that cap.

  • The Dem governors: “Like so many of President Trump’s efforts, capping SALT deductions was based on politics, not logic or good government. This assault disproportionately targeted Democratic-run states, increasing taxes on hardworking families.”

Newsom joins a fellow Bay Area Democrat, House Speaker Nancy Pelosi, who said she was hopeful that a repeal of the cap would be included in the infrastructure proposal.

But that request puts Democrats in an awkward ideological position: 

  • On the one hand: Lifting the cap sticks it to Trump and disproportionately benefits taxpayers in blue states.
  • On the other: It would also disproportionately benefit the super rich. That’s because most people don’t pay more than the current cap of 10 grand in state and local taxes.

A 2020 analysis from the Brookings Institution found that 57% of the savings generated by repealing the cap would go to the top 1% of earners nationwide. But as a CalMatters analysis in 2019 found, some upper-middle-class Californians — particularly new homeowners — would also benefit.

3. Health care delayed

A nurse practitioner examines an elderly patient at a clinic in Guerneville in February 2020. Doctors fear a delay in preventative healthcare caused by the pandemic could lead to an influx in untreated health conditions. Photo by Anne Wernikoff, CalMatters

Millions of Californians spent the last year skipping birthdays, weddings and holidays. Many also skipped their regular doctors appointments, dental visits and even their urgent care needs. And that could have deadly consequences for years to come.

As CalMatters’ health reporter Ana Ibarra reports, a drop in oncology screenings, echocardiograms and other regular checkups all mean that thousands of new cases of cancer, heart failure and cerebrovascular disease will be diagnosed later — potentially after it’s too late.

  • Dr. Richard Bold, UC Davis Comprehensive Cancer Center: “Rather than finding it on a mammogram…the patient now comes in because they feel something and we’re making the diagnosis later on in the course of disease, which unfortunately means a lower likelihood of being cured.”

In the first few months of the pandemic, non-COVID emergency room visits dropped by 42% nationwide. And by August of last year, the number of California children visiting doctors through the state’s Medi-Cal program for low-income families dropped by 40% over the prior year. 

But first things first: Many health care workers are still focused on getting Californians vaccinated. That’s easier to pull off in some communities than others. 

In the High Desert town of Adelanto, where the poverty rate is high and internet connectivity is low, that sometimes means community health workers going door to door or car window to car window.


A Message from our Sponsor


CalMatters commentary

CalMatters columnist Dan Walters: California’s elected sheriffs — part law-enforcement officer, part politician — are feeling the heat in an era of heightened activism on criminal justice reform.

Broadband is a public good: High-speed, reliable internet is a necessary utility for Californians in 2021. It’s time policymakers start treating it like one, write Ranjitha Shivaram, Ph.D student at Stanford University and Josh Lappen, Ph.D student at Oxford University

Time to ditch diesel generators: California isn’t going to meet its ambitious clean power goals if we keep relying on dirty fuel for backup power, argues Bill Magavern, policy director for Coalition for Clean Air.


Other things worth your time

What the car accident that left 13 dead in Imperial County tells us about immigration across our southern border // New York Times

Los Angeles teachers’ want child care before returning to classroom // Politico 

Goodbye to California’s color-coded COVID tiers? Maybe soon. // San Francisco Chronicle

Pomona Congressmember Norma Torres has a new campaign opponent: The president of El Salvador // NPR 

Will our train-loving president provide a lifeline to California’s high-speed rail project? // Mercury News 

Central Valley GOP Rep. David Valadao is donating campaign contributions from scandal-plagued colleague to group that supports domestic violence survivors // Axios 

Careful what you ask for: Gov. Gavin Newsom navigates the politics of a statewide fracking ban // Los Angeles Times

Two Vallejo cops, including union head, fired over emails // San Francisco Chronicle 

After raising million with “deceptive” fundraising emails, Trump campaign beset by a tidal wave of refund requests — including some from California // New York Times

California average weekly wages jumped 12%. Here’s why that’s bad news // OC Register

LAPD officers open fire during three-hour standoff with “mermaid” // Los Angeles Times

Tracking the money in the race to fill Secretary of State Shirly Weber’s old Assembly seat // Voice of San Diego

After baseball nixes Atlanta for the All Star Game, San Diego raises its hand // Fox5 San Diego


See you tomorrow.

Tips, insight or feedback? Email ben@calmatters.org.

Follow me on Twitter: @FromBenC

Subscribe to CalMatters newsletters here.

Follow CalMatters on Facebook and Twitter.

CalMatters is now available in Spanish on TwitterFacebook and RSS.


We want to hear from you

Want to submit a guest commentary or reaction to an article we wrote? You can find our submission guidelines here. Please contact CalMatters with any commentary questions: commentary@calmatters.org .

Ben Christopher

Ben covers California politics and elections. Prior to that, he was a contributing writer for CalMatters reporting on the state's economy and budget. Based out of the San Francisco Bay Area, he has written...