Capitol Alert

The latest on California politics and government

June 4, 2013
FBI raids offices of California Sen. Ron Calderon, Latino Caucus


The FBI this afternoon raided the Capitol office of Sen. Ron Calderon, D-Montebello, as well as the office of the Legislature's Latino Caucus, the Senate's sergeant of arms said Tuesday evening.

"This afternoon, agents from the Federal Bureau of Investigation served search warrants in the State Capitol at the office of Senator Ron Calderon and in the Legislative Office Building at the Latino Legislative Caucus office," said Tony Beard, the Senate's chief sergeant at arms, in a statement to the media.

"Those warrants are sealed by order of the Federal Court; therefore we have no further information," he said. "The Senate has and will continue to fully cooperate with the agents in this matter.

The FBI confirmed federal search warrants were issued in Sacramento.

Laura Eimiller, a spokeswoman for the agency in Los Angeles, said the search involved two locations, both related to the same investigation. She declined to discuss the investigation in any detail.

Neeki Bianchi, a special agent in Sacramento, said the investigation is "not a public safety issue."

Calderon, a business-friendly Democrat who is part of the Calderon political family dynasty, is serving out his final two years as a representative of the 30th Senate District.

Mark Geragos, Calderon's lawyer, said prosecutors "have no case," and accused them of acting inappropriately in disclosing that the FBI was conducting a search.

"The U.S. Attorney's Office should be ashamed of themselves," he said. "They have no case, so what they do is they leak the sealed information in an effort to hassle innocent people, and that's all the comment I have."

When asked about the nature of the investigation, Geragos said, "What they're going after is anything to divert attention from their own misfeasance or malfeasance."

He said, "All I know is that it's very easy to make an allegation when you've got search warrants that are under seal and don't have to defend it, and they should be ashamed of themselves."

Calderon flirted with challenging Democratic Rep. Linda Sanchez in a newly drawn House district in 2012, but dropped his candidacy after Sanchez secured the Democratic Party endorsement.

He chairs the Senate insurance committee as well as a special Senate committee on film and the television industry. Last year he authored successful legislation extending a program that offers tax credits to film producers.

Former Assemblyman Charles Calderon, the senator's brother, told The Sacramento Bee he has not spoken with him since the search warrants were executed.

"I'm shocked," Charles Calderon said. "Right now we don't know any facts, and without facts you speculate about the worst. But I know Ron and ... I am very confident that he'll be able to work through this and that when the facts do come out they will show him to have not been involved in anything."

The Latino Legislative Caucus, comprised entirely of Hispanic Democratic lawmakers, has come under scrutiny in the past for refusing to disclose information about donors to a nonprofit entity it controls called the Latino Legislative Caucus Foundation.

While there was no legal imperative for lawmakers in the Latino caucus to disclose that information, Assemblyman and then- caucus chair Tony Mendoza faced concern over what critics called unwarranted secrecy given the openness of counterparts like the Black Legislative Caucus. Under pressure from party leadership, Mendoza in July of 2011 released a list of donors who had poured more than $400,000 into the foundation since 2009.

More recently, Sen. Ricardo Lara, a Bell Gardens Democrat who currently chairs the Latino Legislative Caucus, canceled a Las Vegas fundraiser for Lara and the Latino Caucus Leadership PAC. The event was to be hosted by Station Casinos, which was been lobbying the Legislature to approve a gambling compact for the North Fork Rancheria of Mono Indians.

Recent filings show that the Latino Caucus Leadership PAC raised just over $74,000 in 2013 through the start of May, with the largest contributions coming from the plastic bag manufacturer Hilex Poly, a California real estate political action committee, NBC Universal and the Viejas tribal government.

Jim Sanders, David Siders and Jeremy B. White contributed to this report.

PHOTO CREDIT: The FBI raided the Capitol office of Sen. Ron Calderon, D-Montebello, and office of the Legislature's Latino Caucus, shown here on Tuesday, June 4, 2013. By Paul Kitagaki/The Sacramento Bee.

June 4, 2013
Coalition storms CA Capitol to rally against Medi-Cal cuts

healthcarerally.jpgThousands of doctors, nurses, unionized health care workers and Medi-Cal patients flocked to the Capitol on Tuesday to protest possible cuts to the Medi-Cal program.

Gov. Jerry Brown's proposed budget calls for a 10 percent reduction in payment to Medi-Cal providers, a move that opponents say would reduce the poorest patients' access to healthcare. He has shown no signs of backing down from the proposed cut.

The "We Care for California" Coalition, which includes health care providers, insurance firms and associations representing doctors and hospitals, organized more than 100 buses to bring protesters from across California to the rally.

Dave Regan, president of Service Employees International Union-United Healthcare Workers West, called upon SEIU-UHW members at the rally to make their voices heard to legislators.

"We deserve better than politics as usual. Better than the politics of disenfranchisement, the politics of erosion of care, the politics of saying 'it's somebody else's problem,'" Regan told the crowd. "And if we can't persuade the governor, we need to find two-thirds of this legislative body who know what the right thing is."

June 4, 2013
John Burton, Jim Brulte spar over crime, campaigns and fate of GOP

photo.JPGIndependent campaign expenditures are corrupting politics and young voters are reshaping California's electorate by eschewing parties.

Those were points of agreement in a talk between practiced adversaries John Burton, chair of the California Democratic Party, and California Republican Party chairman Jim Brulte during a Tuesday morning panel at an American Association of Political Consultants conference.

The talk began with a discussion of whether California has become a one-party state, given Democrats' legislative supermajority and control of every statewide elected office. Brulte, a former state senator who readily acknowledged his party's woes as he campaigned to lead California Republicans earlier this year, pointed to "failure to recognize changing demographics" and said Republicans have been too reluctant to venture into communities outside of their traditional power base.

"If we want to be successful we have to get outside of our comfort zone," Brulte said. "Too many Republican party leaders or Republican elected officials spend all their time talking to the choir."

June 4, 2013
Sports venue fights good fodder for political consultants

JD_STUTZMAN_01.JPGPolitical consultants around the country should find inspiration from Sacramento's saga to keep the Kings and look for opportunities to get involved in sports developments in their own communities.

That was the message a panel of political professionals told an audience of their peers at today's conference of the American Association of Political Consultants in Sacramento.

"When you're building arenas and stadiums, you really do need folks who have a very high political IQ," said Chris Lehane, a Democratic political strategist who is an adviser to Sacramento Mayor Kevin Johnson.

"This really is very similar to a political campaign and there is a huge role for a political consultant to play."

Rob Stutzman, a Republican political consultant who was involved in efforts two years ago to thwart the Kings move to Anaheim, said Sacramento was well armed to fight for its basketball team because it's home to so many people who make a living in politics.

"You're kind of mucking with a political town, so we know how to muck with you," Stutzman said.

"People in this town just scrambled politically because the advantage we had over anyone in Anaheim or Seattle... is that we really know how to fight... and on an issue like this, fight in a very bipartisan manner."

PHOTO: Political consultant Rob Stutzman, in 2003. The Sacramento Bee/John Decker

June 4, 2013
Layoffs at Anaheim's Honda Center become CA state budget issue

HondaCenter2.jpgThe layoff of more than 500 unionized concession workers at Anaheim's indoor sports arena, the Honda Center, has become a bone of contention in the state's budget.

The Assembly's version of the budget contains language that would prevent Anaheim Arena Management, the city-owned Honda Center's operating firm, from claiming state enterprise zone hiring credits for replacing the workers with a new crew.

Three weeks ago, the company announced that it would lay off 500-plus concession workers that had been employed by Aramark, whose concession contract expires on July 1. Anaheim Arena Management, which is taking over concession operations itself, said it would hire replacement workers at wages ranging from $8 to $14 per hour.

The layoffs have sparked protests from United Here Local 11, the union that has been representing Aramark workers at the stadium, home to the Anaheim Ducks hockey team and site of many other entertainment events.

In support of the union, Assembly budget writers inserted language that would prohibit Anaheim Management from claiming hiring credits under the state's enterprise zone program. Meanwhile, however, Gov. Jerry Brown has proposed a broader overhaul of enterprise zones to, he says, concentrate its benefits more narrowly on areas of high unemployment.

Brown's enterprise zone proposal looms as one of the most contentious issues in the budget as the June 15 deadline for its enactment approaches. It arose during Tuesday's meeting of the two-house budget conference committee without resolution.

The Honda Center management said in a statement that "our decision to take food service in-house was based solely on our relentless pursuit of giving our customers the very best entertainment experience possible. It had nothing to do with California Enterprise Zone tax credits, which we never had any intention of utilizing."

Editor's Note: This post was updated at 5:43 p.m.. on June 4, 2013, with the Honda Center statement.

PHOTO: The Honda Center in Anaheim, in 2009. Orange County Register/Miguel Vasconcellos

June 4, 2013
State budget committee ducks software taxation issue

MARKLENO2012.jpgThe Legislature's two-house budget conference committee rejected Gov. Jerry Brown's proposal to "clarify" the state's power to collect sales taxes on computer software Tuesday.

The eight-member committee unanimously approved a motion to leave the issue out of the budget, saying it will receive a full airing in separate legislation, rather than be included in a budget-related "trailer bill."

Nearly three decades ago, the Legislature and then-Gov. George Deukmejian decreed that custom software - programming for a large customer's specific needs - would be free of sales taxes, but state tax officials assumed that they could continue to tax off-the-shelf software. Software taxes generate about $300 million a year in state revenue, plus millions more for local governments.

Recently, however, that assumption has been challenged by a series of court decisions because another section of state tax law exempts ":technology transfers." Brown proposed, therefore, that a budget trailer bill give the state explicit power to tax non-custom software delivered on discs or other physical media.

Conference committee members were warned, however, that rapidly evolving technology could make writing such legislation difficult, and they decided to leave it out of the budget.

PHOTO: Sen. Mark Leno, D-San Francisco, shown here during session in the Senate chambers in March, is chairman of the two-house budget conference committee. The Sacramento Bee/Hector Amezcua

June 4, 2013
Dan Walters Daily: It's a three-way budget fight

With only 11 days to go, Dan wonders whether the Legislature will be able to put together a "real budget" before the June 15th deadline.

Have a question you'd like Dan to answer? Post it on our Facebook page.

See other Dan Walters Daily clips here.

June 4, 2013
AM Alert: Massive Sacramento rally challenges Medi-Cal cuts


In the dispute over whether Gov. Jerry Brown's budget should do more to repair the state's tattered safety net, the fate of a planned cut in Medi-Cal payments to providers has taken a prominent role. A coalition of health insurance firms (among them Anthem Blue Cross and Blue Shield of California), medical professional associations (including the California Hospital Association and the California Medical Association) and the Service Employees International Union-United Healthcare Workers West is busing thousands of advocates to Sacramento today for a huge Medi-Cal rally.

Lawmakers expected to speak during between 1 p.m. and 2 p.m. include Assemblyman Richard Pan, D-Sacramento, and Assemblyman Luis Alejo, D-Watsonville. There are a couple of bills dealing with Medi-Cal payments before the Legislature right now -- the one authored by Alejo made it out of the Assembly while the Senate version was re-referred to committee -- and Brown's proposed budget includes a 10-percent reduction that has been ensnared in a court fight since being approved in 2011 but was just upheld by a federal appeals court.

VIDEO: Dan Walters contemplates the obstacles in the way of the Legislature passing a budget on time.

SAFETY UNDERGROUND: Concerns about excavation safety burst to the surface with the San Bruno pipeline explosion back in 2010, and a subcommittee on gas and electricity infrastructure is taking a look. Starting at 9:30 a.m. in room 3191.

CONSULTANTS CONFER: The American Association of Political Consultants is holding a conference today at the Sheraton Grand, where attendees will hear panels on topics that range from international elections to the intersection of sports and politics (featuring The Bee's Marcus Breton and some prominent operatives talking about the still-of-Sacramento Kings) to a talk on ballot initiatives moderated by strategist Garry South. Democratic Party chair John Burton and California Republican party chair Jim Brulte will spar in a lunchtime talk on the state of California's political parties, moderated by USC professor and former Fair Political Practices Commission chief Dan Schnur.

CONTRACTORS COLLECT: Also in town are participants in the Associated General Contractors of America's lobby day. In a morning session at the California Chamber of Commerce building on K Street, members will discuss topics like workplace safety and transportation funding and will hear from Assemblywoman Susan Eggman, D-Stockton, CalTrans director Malcolm Dougherty, Department of Industrial Relations director Christine Baker and Steve Sands of the Contractors State License Board.

STUDENT DEBT: Student loans have been back in the news lately, with the president and Congress squaring off over a coming rate hike, and today a Public Policy Institute of California talk is examining the implications of rising tuition and a cumulative student debt load that is nearing $1 trillion. Speakers include David Alcocer, interim director of student financial support for the University of California, Debbie Cochrane of the Institute for College Access and Success and Hans Johnson and David Lesher of PPIC. From noon to 1:30 p.m. at the CSAC Conference Center.

LATINO PRIORITIES: Members of the California Latino Legislative Caucus are going to be laying out their agenda today during a 3 p.m. media briefing. After that, Assembly Speaker John A. PĂ©rez, D-Los Angeles, and members of the caucus are heading over to the California Downtown Association conference room on L street for a Dolores Huerta Foundation fundraiser, which trains community organizers. Huerta will be there as well, along with what is expected to be more than a dozen lawmakers.

PHOTO CREDIT: History is repeating itself at the Capitol as advocates rally against Medi-Cal cuts, just as they did during this April 15, 2008 demonstration organized by the California Medical Association. By Brian Baer/The Sacramento Bee.


Capitol Alert Staff

Jeremy White Jeremy B. White covers California politics and edits Capitol Alert's mobile Insider Edition. Twitter: @capitolalert

Amy Chance Amy Chance is political editor for The Sacramento Bee. Twitter: @Amy_Chance

Dan Smith Dan Smith is Capitol bureau chief for The Sacramento Bee.

Christopher Cadelago Christopher Cadelago covers California politics and health care. Twitter: @ccadelago

Micaela Massimino Micaela Massimino edits Capitol Alert.

Laurel Rosenhall Laurel Rosenhall covers the Legislature, the lobbying community and higher education. Twitter: @LaurelRosenhall

David Siders David Siders covers the Brown administration. Twitter: @davidsiders

Dan Walters Dan Walters is a columnist for The Sacramento Bee. Twitter: @WaltersBee

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