Capitol Alert

Tim Donnelly raised less than $300,000 for his gubernatorial campaign in the second half of last year, leaving him with only $54,299 in cash on hand by the end of December, he reported Friday.

The Twin Peaks assemblyman is one of two Republicans bidding to unseat Gov. Jerry Brown this year. The Democratic governor reported earlier Friday that he had increased his war chest to about $17 million by the end of December.

Donnelly raised $291,063 and spent $286,069 from July 1 to Dec. 31, 2013. His contributions for the full year totaled $374,213. The Legislature's most outspoken gun rights and anti-illegal immigration advocate struggled to raise major contributions, relying on scores of individual donations of several hundred dollars or less.

Brown, a Democrat, has not yet said if he will seek re-election, but he is widely expected to run. The other Republican running, former U.S. Treasury Department official Neel Kashkari, did not start fundraising until earlier this month, when he announced his candidacy. His first financial filing is not expected until later in February.

Former Lt. Gov. Abel Maldonado, who dropped out of the race in January, raised $203,550 in the second half of the year and spent $181,274. He had an ending cash balance of $22,727 on Dec. 31.

PHOTO: Assemblyman Tim Donnelly, R-Twin Peaks, speaks in Baldwin Park Tuesday, Nov. 5, 2013. Associated Press/Nick Ut

It's not every day you receive encouragement from the dead. But that's what Kim Alexander, president and founder of the nonprofit California Voter Foundation, found in her mailbox earlier this week.

Along with lovers of American folk music everywhere, Alexander spent much of Tuesday mourning the death of legend Pete Seeger. Then she opened her mailbox to find a letter postmarked Beacon, New York.

That was the first clue. Alexander looked inside the envelope to find a note signed "94-year-old Pete," accompanied by a drawing of a banjo, and realized what she was holding.

"It was such an unreal, magical experience," Alexander said. "It's turned what started out as a very sad event into reminding us that his memory is very much alive, and his music is very much alive for all of us."

Back in August, Alexander had written Seeger a letter seeking advice on nurturing her monthly acoustic Sacramento jam session, which has grown from five regulars to some 200 occasional participants. A self-described "jamvangelist," Alexander grew up with folk music regularly playing in her house, including Seeger's iconic tunes.

Alexander said she wrote the letter partially out of the sense that Seeger "would not be with us forever," but she did not necessarily expect a response. The letter she received on Tuesday was dated Saturday, two days before Seeger's death. He had responded to her by writing notes in the margin, advising her on how to attract more people to the jam group.

Since sharing the story on social media, Alexander said she has seen a voluminous outpouring of interest in the story. To her, that broad response is in keeping with Seeger's legacy, which extends beyond his role as an acclaimed songwriter and activist.

"Those are all deserving accolades and he was all of those things but he was first and foremost a song leader," Alexander said. "He was always encouraging everyone to sing along."

PHOTO: An image of the letter, with Seeger's handwriting visible in the margins, courtesy of Kim Alexander.

When Neel Kashkari told conservative talk radio listeners in Los Angeles this week that he would not immediately move to lower taxes on the wealthiest Californians, he suggested his campaign for governor will diverge from a tax-cutting theme Republicans have pressed hard in recent years.

The position is strategic, not ideological. Voters in this Democratic state overwhelmingly approved a tax increase in 2012, and Kashkari — outflanked by a more conservative candidate, Tim Donnelly, on the right — will likely need support from independent voters to advance from the June primary election to a runoff against Gov. Jerry Brown in the fall.

On the "John and Ken" show Thursday, Kashkari assured his hosts that he believes "our taxes are too high" and wants to "get everyone to the table" to discuss them. But he said, "I don't think, politically, that's where we start."

Instead, Kashkari is embracing another, equally reliable conservative stand-by. One week into his campaign, Kashkari — like Arnold Schwarzenegger and Meg Whitman before him — is going after budgetary waste.

"To me, I think it's critical that we start getting our money's worth for the taxes that we're collecting," Kashkari said. "We spend more than $40 billion a year on K-12, and only about half of that money is actually getting into the classroom. Half of it is being spent on administration and overhead and other things."

That should sound familiar. In the Republican gubernatorial primary four years ago, Steve Poizner promised to fix a public education system "that wastes a lot of money," while Whitman planned to devote more funds to classroom teaching and less to "bureaucracy." Whitman proposed eliminating "waste, fraud and abuse" statewide, as did Schwarzenegger, the last Republican to occupy the governor's office. Experts said the amount of fat in the budget was overstated, and seven years after he took office, Schwarzenegger left Sacramento with a deficit.

Kashkari, a former U.S. Treasury Department official, has not put a number on the overall budget savings he believes he could find. But education is a focus of his campaign, and on that subject Kashkari went to his radio interview prepared. The basis for Kashkari's claim that classrooms are being shortchanged is a 2011 study that found direct spending in California classrooms declined from 59 percent to less than 58 percent of total expenditures from 2003 to 2009, even as total education spending increased.

The report, by Pepperdine University, is questionable for what it counted as "direct classroom expenditures." It included teacher salaries and estimated benefits, textbooks and materials and supplies, but not the cost of library or cafeteria workers, busing and building maintenance.

The report, produced with funding from the conservative Small Business Action Committee, stirred controversy when it was released several years ago. Now the study - or some version of it - is likely to feature prominently in Kashkari's campaign. If he can persuade voters that education money could be redirected from the bureaucracy to classrooms, he could propose any number of programs without needing to identify additional funding.

Kashkari has not released any detailed policy proposals, but on Thursday he expressed interest in vocational training and a longer school year, and he praised ideas advocated by former Florida Gov. Jeb Bush. Since leaving office, the former governor has been promoting his "Florida formula" for public education that includes assigning letter grades to schools while emphasizing vouchers, online instruction and reading tests that third graders must pass before being promoted.

Experts have debated the influence of these polices on student achievement in Florida, but Kashkari is inspired.

"They brought more choice to parents, they brought more power into parents, they provided more accountability," Kashkari said. "This is not rocket science."

PHOTO: Neel Kashkari speaks at an interview with The Associated Press in Sacramento on Dec. 4, 2013. AP Photo/ Rich Pedroncelli

Gov. Jerry Brown raised $7.1 million for his re-election campaign in the second half of last year, he reported Friday, increasing his total war chest to about $17 million by the end of December.

The Democratic governor has not yet said if he will seek re-election but is widely expected to run. He received major funding from labor unions and business interests, including oil and telecommunications companies.

Brown leads a small field of Republicans by a wide margin in early fundraising and polls.

Brown reported spending only about $208,000 in campaign operations last year, with most of that amount coming in the last six months of the year. In addition to various office and fundraising expenses, Brown reported "bonus" payments of $25,000 each to Angie Tate, a Democratic fundraiser, and Edward Ruthrauff, who worked on Brown's 2010 campaign before coming into the administration to be Brown's director of constituent affairs.

Assemblyman Tim Donnelly, R-Twin Peaks, has until the end of the day to file his year-end financial statement. Neel Kahskari, a former U.S. Treasury Department official, did not start fundraising until earlier this month, when he announced his candidacy.

PHOTO: Gov. Jerry Brown speaks at the California Chamber of Commerce's annual host breakfast in Sacramento on May 22, 2013. The Associated Press/Rich Pedroncelli

California's pot of school bond money may be empty, but school and community college districts have more than $37 billion in authorized — but unspent — school-construction bonds, according to a report by the state's debt commission.

Since November 2002, there have been 681 school and community college elections that yielded about $90.1 billion in voter-approved borrowing authority to build and modernize schools. Yet only about $52.6 billion of those bonds have actually been issued, according to the California Debt and Investment Advisory Commission report last week.

Voter-approved bond authority vs. issuance

Source: California Debt and Investment Advisory Commission

The report comes as several rounds of school bonds authorized by state voters — most recently in November 2006 — are nearly exhausted. Assemblywoman Joan Buchanan, D-Alamo, is working on legislation for a new state school bond in November, but no proposal has emerged.

Any plan for a new bond would have to win over Gov. Jerry Brown. In his proposed budget earlier this month, Brown voiced skepticism about local school projects relying on significant help from the state.

"Any future program should be designed to provide districts with the tools and resources to address their core facility gaps, but should also avoid an unsustainable reliance on state debt issuance that characterizes the current school facilities program," the budget summary reads.

The state board that distributes voter-approved school-construction money also has looked at the issue. A recent report called for major changes to the school facilities program, such as ending bond-funded purchases of portables and requiring districts to commit to spending to maintain new buildings.

In its report, the debt advisory commission said state law requires local school districts to have enough property tax revenue to make payments on the borrowing. But the recession likely upended that math and put a chill on bond sales.

"The data also reveals a marked jump in the percentage of the unissued authority post 2007," the report reads. "Falling property values, likely, could not support the increasing tax revenue that was required to service additional debt."

The property-tax outlook seems to be brightening. In its November fiscal outlook, the Legislative Analyst's Office projected that local property taxes would grow by about 7 percent a year.

In addition to the recession, another possible reason for locals' reticence to sell bonds was a lack of state matching funds, the report said.

PHOTO: Construction crews worked on the East Natomas Education Complex in March 2008. The complex features a new high school, a middle school, an aquatics center, and more. The Sacramento Bee/Autumn Cruz

State and federal water officials announced Friday that deliveries of state water to agricultural and municipal users south of the Sacramento-San Joaquin Delta, which had been slashed to 5 percent earlier, will drop further to zero due to the state's severe drought.

It will be the first time that the state has taken such drastic action.

"There's not enough water to go around," state Water Resources Director Mark Cowin said at a news conference. He also said that releases from severely depleted state and federal reservoirs would be dropped to the minimum necessary to prevent salt water intrusion into the Delta.

The reduction is one of a series of steps that water authorities are taking to curtail use because the state is in the third and worst year of drought, despite a light rainstorm that hit the northern part of the state this week.

Agricultural production accounts for most of the state's water use and is expected to be hit the hardest by the reduction. Municipal users in Southern California will fare better because the Metropolitan Water District that serves the area has reported fairly heavy reserves.

PHOTO: Cattle hoof prints mark the dry reservoir bed that normally stretches to Ione road in the east at the Van Vleck Ranch at Wednesday January 22, 2014 in Sacramento County, Calif. The Sacramento Bee/Paul Kitagaki Jr.

State Sen. Ted Lieu confirmed Friday he will run to succeed veteran Rep. Henry Waxman, joining a field of potential successors that already includes former Los Angeles Controller Wendy Greuel.

Lieu, whose Senate territory encompasses more than 80 percent of the 33rd Congressional District, called Waxman "a living legend."

"I am running because I love America. But our nation can do better," said Lieu, D-Torrance, a lieutenant colonel in the Air Force Reserves. "I have made the hard choices that helped turn California's budget deficit into a budget surplus; fought to protect our environment; co-authored legislation to divest California's pension funds from Iran's energy and nuclear industries; and authored landmark civil rights legislation. I will fight hard for my constituents in Congress as I have done in the state Senate."

33rd Congressional District

On Thursday, Waxman announced he would not seek a 21st term in the House of Representatives. Greuel followed hours later with a Twitter message saying she would "fight like Congressman Henry Waxman on issues important to our families."

Fran Pavley, D-Agoura Hills, and Assemblyman Richard Bloom, D-Santa Monica, have yet to indicate whether they plan to run. Others weighing a candidacy are Los Angeles County Supervisor Zev Yaroslavsky, Secretary of State Debra Bowen, former Democratic lawmaker Betsy Butler and Sandra Fluke, the women's rights activist.

Lieu's announcement includes endorsements from a veritable who's-who of elected officials and community leaders from inside and outside the heavily Democratic Los Angeles County congressional district that stretches from Malibu to the Palos Verdes Peninsula.

His entry into the race could yield more jockeying and set off another round of legislative dominoes should Bloom or Al Muratsuchi, D-Torrance, challenge for the Senate seat Lieu must relinquish. He was set to term out in 2018.

PHOTO: State Sen. Ted Lieu, D-Torrance, during a hearing at the Capitol in Sacramento, Calif., Tuesday, May 8, 2012. AP Photo/Rich Pedroncelli.

Two days after a jury found him guilty of eight felonies related to living outside the district he represents, Sen. Rod Wright introduced a bill that would allow people convicted of non-violent felonies to have their crimes converted to misdemeanors.

Wright did not attend the Senate's floor session Thursday, but legislative records show that on that day he introduced Senate Bill 929, which would grant new benefits to non-violent felons who are not sentenced to prison.

The bill says that a felony offense would be deemed a misdemeanor "if the court finds that certain circumstances apply, including that the defendant was not imprisoned in the state prison for the offense, the offense for which the defendant was convicted was not a serious or violent felony, as defined, the offense does not require registration as a sex offender, the defendant is not currently charged with and has not been convicted of an offense in the preceding 5 years, except as specified, and the defendant presents clear and convincing evidence that he or she has been rehabilitated."

While Wright has lost his chairmanship of the Senate Governmental Organization Committee, his Democratic colleagues have stopped short of asking him to leave office.

Yet it does not appear the felony-to-misdemeanor bill will advance. A spokesman for Senate President Pro Tem Darrell Steinberg said the legislation will not be referred out of the Senate Rules Committee.

"Putting the merits of the policy aside, it's the wrong author at the wrong time," said spokesman Rhys Williams.

Wright's office has not returned a call for comment.

A Los Angeles jury on Tuesday found Wright guilty on all eight felony counts he was charged with in a case that challenged whether he lived in the Inglewood home he claimed as his domicile when he ran for office in 2008. Prosecutors alleged Wright really lived in Baldwin Hills, a tonier area outside the district he represents.

Wright's sentencing hearing is scheduled for March 12. His lawyer has said he plans to appeal the case.

SB 929

Editor's note: This post was updated at 11:30 a.m. Jan. 31 to include comment from Steinberg's office and lack of comment from Wright's office.

PHOTO: Sen. Rod Wright, D-Inglewood, walks into the California Senate floor during the first day of session Jan. 6, 2014 in Sacramento. Hector Amezcua/Sacramento.

As evidenced by our recent report on Republicans fretting over their grim prospects in statewide races, the 2014 election is closer than you think. Soon, we'll see where the donation dollars fell in the latter half of 2013.

Today marks the campaign finance filing deadline for the second section of 2013, which means we'll see who gave what to whom between July and December. Contributions over $5,000 have to be reported more frequently, which allows us to feed you a steady diet of posts on contributions to the technically nonexistent re-election campaign of Gov. Jerry Brown, but the more comprehensive information that has to be in today will include smaller donations and help illustrate the state of Assembly and Senate races.

VIDEO: Car taxes again entered the political arena, a move Dan Walters says points to California's dire need for infrastructure dollars.

LEGALLY A LAWYER: The long odyssey of Sergio Garcia ends tomorrow. Despite passing California's bar exam, Garcia was prohibited from practicing law because he was brought to the country illegally as a child. A bill passed last year led the California Supreme Court to reverse its opposition, and Garcia will be formally sworn in on Saturday during a ceremony on the West steps.

POWER LUNCH: A pair of formidable Democratic women will be drumming up money in San Francisco today. First lady Michelle Obama and U.S. Rep. Nancy Pelosi, D-San Francisco, will be hosting a "women's lunch" for the Democratic Congressional Campaign Committee, with the price of admission running from $500 for an individual to $32,500 for couples seeking deluxe VIP access.

FILM CREDITS: The push to sustain tax credits for movie production is rolling. The topic will be on the agenda at a California Film Commission board meeting in Los Angeles this afternoon, with Assemblyman Raul Bocanegra, D-Los Angeles, expected to give an update on the legislative prospects.

PARENT TRIGGER: Speaking of the movies, those of you interested in education reform can check out a film screening today of "We the Parents," a documentary examining how parents in Compton invoked California's "parent trigger" law to take over a struggling school. The screening follows the Senate passing a resolution by Senate Republican Leader Bob Huff, R-Diamond Bar, recognizing National School Choice Week in California. In room 3191 of the State Capitol at 11 a.m.

PHOTO: In this photo taken Tuesday, Jan. 28, 2014, a woman counts U.S. dollar banknotes at a currency exchange office in Istanbul, Turkey. The Associated Press/Emrah Gurel.

The state's beleaguered transportation system deserves more attention from the Legislature than the trivial issues they focus on day in and day out, Dan says.

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PHOTO: Drivers navigate their vehicles through blowing sand east of Owen's lake on Highway 136 near Lone Pine, Calif. on November 21, 2013. The Sacramento Bee/Randy Pench

After more than three years away, former First Lady of California Maria Shriver returned to Sacramento Thursday to deliver a new report on women and poverty to the governor and legislators.

Her afternoon kicked off with a discussion of the report's findings at the California Museum, attended by dozens of the capital's most powerful women, including Secretary of State Debra Bowen and U.S. Rep. Doris Matsui, D-Sacramento.

Shriver emphasized that women's empowerment efforts must broaden from the "1 percent" and "talking about getting the corner office" to include the one-third of American women living in financial insecurity.

"They are looking for some help to give their family a life that's better than theirs," she said during the 45-minute conversation, part of Dewey Square Group's quarterly She Shares speaker series.

Calling on the government to get creative in how it helps women, Shriver said her work on this subject is largely influenced by her father, Sargent Shriver, who headed the War on Poverty in the 1960s. Shriver affectionately referred to him as "Daddy" as she spoke about initiatives like Head Start and low-income legal services.

When they're funded, Shriver said, "Those programs work."

Even as she spoke about raising a family, Shriver conspicuously avoided mentioning estranged husband Arnold Schwarzenegger. His name only came up once, when Shriver urged more bipartisan cooperation in the state and federal governments.

Having grown up a Kennedy, she joked, "I think the first Republican I met was Arnold."

With veteran U.S. Rep. Henry Waxman announcing his retirement earlier in the day, buzz also surrounded whether Shriver, a resident of his Los Angeles district, might enter the family business and run for his seat.

"No. Nope," she told The Bee after the event.

PHOTO: Maria Shriver meets event attendees before speaking about women and poverty at the California Museum on January 30, 2014. The Sacramento Bee/Alexei Koseff

California Senate leader Darrell Steinberg said today that he is removing Sen. Rod Wright from his position as chair of the Senate's Governmental Organization committee but is not asking the legislator found guilty this week of eight felonies to leave office.

"Where we stand today, there is no final conviction, but a jury verdict," Steinberg said. "Unless and until there is a final conviction for a felony I do not believe it is appropriate or necessary to expel Senator Wright or ask him to resign."

Steinberg said Wright plans to appeal Tuesday's convictions, in which a Los Angeles jury found him guilty of eight felonies for not living in the Senate district he represents. He said Wright asked to be removed from chairing the committee that oversees California's gambling and alcohol laws.

"What I'm trying to do, what I'm endeavoring to do, is to balance the fact that he has not been fully and finally convicted, with respecting the fact that a jury of his peers have rendered their part of the judgment, and to suggest a course of action that recognizes both of those things," Steinberg said.

Video: Sen. Steinberg talks about Rod Wright's future:

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PHOTO: Sen. Rod Wright, D-Inglewood, shown inside the Capitol in February 2009. The Sacramento Bee/Brian Baer

Democrats in the California Senate used their two-thirds supermajority Thursday to pass a measure that would ask voters if they want to repeal the state's ban on race- and gender-based preferences in government hiring and contracting and university admissions.

With the bare minimum number of votes needed - 27 - the upper house passed and sent to the Assembly Senate Constitutional Amendment 5, which would ask voters if they want to repeal provisions that became law 18 years ago with the passage of Proposition 209.

The measure by Sen. Ed Hernandez, D-West Covina, prompted lively debate between Democrats and Republicans on the Senate floor. Democrats argued that California's preferences ban has hampered opportunities for Latino and African Americans in the state to get into college and ultimately achieve economic mobility. Republicans argued that the way to make college attainable for more students of color is to improve the K-12 schools in their communities.

"Why aren't we challenging the education system in California, which in many cases is doing a terrible job," said Sen. Ted Gaines, R-Roseville, adding that charter schools and vouchers would allow parents more choices.

Sen. Kevin de León, the Los Angeles Democrat who is in line to become the next President Pro Tem of the Senate, countered that California's earlier use of preferences advanced his opportunities in life.

"If it weren't for affirmative action, I,Kevin de León, wouldn't be here today," he said.

PHOTO: Senator Ed Hernandez, D-West Covina during session in the Senate chambers in Sacramento, Calif. on Monday, March 11, 2013. The Sacramento Bee/Hector Amezcua.

California politicians grappling with a drought now have a third proposal spelling out which water projects should be placed in a bond on the November ballot.

Republican state Sens. Anthony Cannella of Ceres and Andy Vidak of Hanford today announced a proposal to put a $9.2 billion bond on the ballot. That's nearly $2 billion less than the bond legislators approved in 2009 but have delayed placing on the ballot.

Two Democrats are also working on water bond proposals that would cost less than the 2009 measure: Assemblyman Anthony Rendon of Lakewood and Sen. Lois Wolk of Davis.

The Republican proposal announced today prioritizes water storage and clean drinking water. It eliminates funding originally proposed for water supply in San Diego and Maywood; University of California research on climate change; and a raft of conservation and watershed restoration projects throughout the state.

"Water is life, it's food, it's jobs," Vidak said during a Capitol press conference this morning. "It's a crying shame to let precious water wash out to sea."

PHOTO: Visitors at Folsom Lake experience the long walk to the shoreline in 2011 due to the low water level. Lack of snow and rain has delayed the filling of the local reservoir. The Sacramento Bee/Randy Pench

One of the most entertaining orators in the state Capitol is the Democratic state senator who was convicted Tuesday of eight felonies for not living in the Los Angeles-area legislative district he represents.

Sen. Rod Wright -- who routinely speaks out during debates over vocational education, gun rights, energy policy and gambling -- often peppers his testimony with the kind of zingers you don't usually hear from elected officials. He talked about the "po-po" in discussions about the police; spoke out against bills he believed were "robbing the hood"; and often argued something was obvious by saying, "even Ray Charles can see that..."

Wright's colleagues playfully tossed the one-liners back at him on the last night of the legislative session last year, as he presented Senate Bill 470 around 9 p.m. Here's a video clip of the Wright-themed round of legislative bingo, in which lawmakers try to insert a list of certain words into their floor speeches, including quips from Senators Ron Calderon, Lois Wolk, Fran Pavley and Ben Hueso.

PHOTO: Sen. Holly Mitchell covers her ears jokingly as Sen. Roderick Wright talks to her and Sen. Hannah-Beth Jackson earlier this month. The Sacramento Bee/Hector Amezcua

Gov. Jerry Brown's political spokesmen took to Twitter to trash Neel Kashkari when the Republican's inconsistent voting record gained broader attention in recent days, and they jumped again when the shortcomings of another candidate, Tim Donnelly, came to light.

"The governor's been a regular voter his entire life," spokesman Dan Newman said, "and the Republicans haven't."

Both Kashkari and Donnelly failed to vote in many elections after turning 18, according to voter records, though they have voted in most presidential and gubernatorial contests in California.

Brown's voting record over the past two decades is far superior. But not perfect.

The Democratic governor has voted in 28 of 30 elections since the mid 1990s, according to the Alameda County Registrar of Voters.

One election Brown missed, in 1997, involved a tax for emergency medical services.

The other was more historic. Brown was mayor of Oakland when Audie Bock upset Elihu Harris, a former mayor, to win an Assembly seat in 1999. Bock became the first Green Party candidate in the nation to hold a state office. According to Alameda County officials, Brown didn't cast a vote.

Newman said Brown's recollection is that he did vote in that election.

Regardless, Newman said, in comparing the candidates' records "you've confirmed the stark contrast."

PHOTO: Gov. Jerry Brown speaks at an event in Oakland on Nov. 1, 2013. Associated Press/Marcio Jose Sanchez

Veteran Los Angeles Democratic Rep. Henry Waxman's retirement is likely to set politicians scrambling for his 33rd Congressional District.

As was the case a few weeks ago when longtime Rep. George Miller, D-Martinez, said he would step down, those entertaining a run could emerge from the California Legislature.

Lawmakers living in Waxman's heavily Democratic district are Sens. Ted Lieu, D-Torrance, and Fran Pavley, D-Agoura Hills, and Assemblyman Richard Bloom, the former mayor of Santa Monica.

Pavley said she this morning she is considering a run but hesitates to leave the state Senate, where Democrats hold a super-majority, for Congress, where Democrats are in the minority and may continue to be.

"I'll think about it, but my expertise is in state issues," Pavley said. "It's a wonderful district to represent. I know the people and the issues very well. But it's difficult times in Congress right now."

Bloom did not rule out a run but said he is still absorbing the news of Waxman's departure.

"I am considering it," Bloom told the Bee. "This news is very, very fresh, and I haven't even had a chance to have more than a 30-second conversation with my wife. So we'll be tossing this idea around over the weekend."

Lieu sent an email to supporters saying he is "seriously looking at running" for Waxman's seat and will make a formal announcement tomorrow. The email pointed out that Lieu's 28th Senate District includes over 80 percent of Waxman's congressional district.

"This morning I called Congressmember Henry Waxman and congratulated him on his remarkable service to our nation. Congressmember Waxman set the platinum standard for representing the best interests of his constituents as well as the overall quality of life for Californians and our nation," Lieu said in the statement. "Henry Waxman is a legend, not just in California, but in America."

33rd Congressional District

Rick Taylor, a political consultant for Zev Yaroslavsky, said the veteran county supervisor is weighing a run and is likely to make a decision soon.

"I think he's always wanted to be a congressman," Taylor said.

"If it was 20 years ago, I know the answer," he added. "Today, he's got to contemplate it."

Waxman's district, which runs along the coast taking in Malibu, Beverly Hills and south through Marina Del Rey and Torrance, is 44 percent Democratic and 27 percent Republican. It includes a high number of no-party preference voters.

Bill Bloomfield, the independent candidate who gave Waxman a tough race in 2012, is seriously considering running.

The list of other possible contenders is long and could complicate the battle for another highly-coveted prize in Los Angeles: a seat on the county Board of Supervisors. Do Sheila Kuehl or Bobby Shriver duck out of that race and take their shot at Congress?

Former City Controller Wendy Greuel, who waged a bruising race for mayor against Eric Garcetti could contend for the seat. As could termed-out Secretary of State Debra Bowen, who three years ago failed to make the runoff in a special election to replace Jane Harman for a South Bay-based congressional seat.

Laurel Rosenhall and Jeremy B. White of The Bee Capitol Bureau contributed to this report.

Editor's Note: This post has been updated to include comments from Bloom, Taylor and .Lieu

PHOTO: Rep. Henry Waxman, D-Calif., questions witnesses during a hearing on Capitol Hill in Washington. (AP Photo/ Manuel Balce Ceneta)

Sacramento's record winter stretch without rain has finally come to an end, but the California drought marches on -- and with it, California politicians' efforts to find a solution.

Gov. Jerry Brown, who yesterday spoke with President Barack Obama about the drought, continues his trip south with a visit to the Metropolitan Water District of Southern California in Los Angeles. Meeting with more than a dozen water leaders from across the region, he will discuss water management actions and the need for all Californians to conserve water.

Back in Sacramento, state Senators Anthony Cannella, R-Ceres, and Andy Vidak, R-Hanford, are planning to announce new legislation to address the water crisis during a press conference in Room 3191 of the State Capitol at 8:45 a.m.

VIDEO: Until the state deals with its massive unfunded liabilities, calling the budget balanced is wishful thinking, Dan Walters says.

SHRIVER STRIKES BACK: Former First Lady of California Maria Shriver returns to Sacramento today to discuss recent findings from The Shriver Report on the financial security of women in America. The conversation, part of Dewey Square Group's "She Shares" series, takes place at the California Museum on O Street at 12:30 p.m. and will be streamed live. In her first visit back to the capital since estranged husband Arnold Schwarzenegger left office in 2011, Shriver is also expected to deliver her report to the governor's office and meet with members of the Legislature.

TUNNELS TIME: Those interested in learning more about the controversial Bay Delta Conservation Plan can attend an informational open house from 3 p.m. to 7 p.m. at the Sheraton Grand on J Street. The events includes exhibits and will have project team members on hand for one-on-one discussions about the draft proposal and the draft environmental impact report, which were released last month.

PRISON POLICY: The Senate Committee on Budget and Fiscal Review holds a hearing on the cost of incarceration and prisoner rehabilitation at 10:30 a.m. in Room 4203 of the State Capitol. Among those slated to testify is former Orange County Assemblyman Chuck Devore, now the vice president of policy at the Texas Public Policy Foundation, a conservative think tank.

LUNCHTIME TALKS: A new survey from the Public Policy Institute of California examines public opinion of Brown's 2014-15 budget proposal and a wide range of other fiscal issues, immigration and health care policy. PPIC research associate Sonja Petek will discuss the results at noon at the Cathedral of the Blessed Sacrament on 11th Street.

How is California doing compared to other states and countries in providing accessible, high-quality and affordable health care? Dr. Patrick Romano, a professor at the UC Davis School of Medicine, will address that question at noon at the UC Center Sacramento on K Street.

PHOTO: Fields planted with forage seeds wait for rain at the Van Vleck Ranch in Sacramento County on January 23, 2014. The Sacramento Bee/Paul Kitagaki Jr.

Until the state figures out how to deal with its massive unfunded liabilities, any claim of a balanced budget is wishful thinking, Dan says.

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PHOTO: A bicyclist keeps her sweater handy with dark clouds looming as she rides in the shadow of the CalSTRS headquarters building on Riverwalk Park in West Sacramento on September 30, 2013. The Sacramento Bee/Manny Crisostomo

As the federal health care overhaul continues to divide Californians, President Barack Obama's approval here plunged to a record low, according to a new poll from the Public Policy Institute of California.

The president's job approval dropped to 46 percent among likely voters while state residents gave a collective shrug to the Affordable Care Act, his signature legislative achievement. Some 46 percent view the law unfavorably, 44 percent favorably.

Still, a large majority of residents say they plan to comply with the law, which requires nearly everyone to obtain insurance coverage or pay a penalty. Among the uninsured, 72 percent say they plan to acquire health insurance this year, 18 percent indicate they will not, and 9 percent remain unsure. Among those covered, 6 percent obtained it on their own, with the remainder receiving it from another source, such as their employer.

Despite California's comparatively smooth roll-out, fewer than half of the state's adult residents believe their online marketplace is working well, with the uninsured more likely to say it's not working (50 percent) than those with health care coverage (36 percent).

Covered California has struggled to attract certain demographics, namely young people and Latinos. Among racial and ethnic groups, African Americans (62 percent) were more likely than Latinos (52 percent), Asians (45 percent) and whites (39 percent) to say the program is working well.

The health care act is expected to play prominently in the midterm elections, where Republicans are harnessing disapproval for the law to retain their House majority and possibly regain control of the U.S. Senate.

While slightly more than half of the state's adults approve of their own congressional representative, likely voters are more divided: 48 percent approve and 42 percent disapprove. Democratic Sens. Dianne Feinstein and Barbara Boxer draw the approval of 49 percent and 48 percent of likely voters, respectively.

Californians' faith in a year of action described by Obama in his State of the Union Address Tuesday appears low. Roughly 60 percent believe Obama and Congress will not be unable to work together to accomplish a lot. At the time of Obama's inauguration, more than 80 percent believed there would be successful collaboration between the executive and legislative branches.

The survey, conducted with funding from The James Irvine Foundation, is based on interviews with 1,706 adult residents from Jan. 14 to Jan. 21. The margin of error is 3.8 percent to 4.6 percent in either direction.

President Barack Obama called Gov. Jerry Brown on Wednesday to discuss California's drought, as the governor prepares to meet Thursday with water officials in Los Angeles.

The White House said in a release that Obama called Brown "to receive an update on the situation in California and express his concern for the citizens impacted by the historic drought conditions facing the state - conditions that are likely to have significant impacts on the state's communities, economy and environment in the coming months."

Brown's office said the governor will meet privately "with more than a dozen water leaders from across Southern California" on Thursday. The Democratic governor announced a state of emergency earlier this month and urged Californians to reduce water use by 20 percent.

California is suffering through dry conditions for a third straight year, depleting reservoirs and leaving streams and rivers running low.

The U.S. Department of Agriculture has designated parts of California as primary natural disaster areas due to the drought. The designation makes certain farmers eligible for low-interest emergency loans to cover losses.

Among other measures, the White House said Wednesday that the Department of Agriculture is working with farmers and ranchers to "increase their irrigation water efficiency, protect vulnerable soils from erosion, and improve the health of pasture and range lands."

PHOTO: President Barack Obama speaks about the new health care law during a White House Youth Summit, in the South Court Auditorium in the Eisenhower Executive Office Building on the White House complex in Washington. Associated Press/Carolyn Kaster

A campaign by civil rights groups and their political supporters to reduce suspensions and expulsion of public school students due to their disproportionate effect on black and Latino youngsters may be paying off.

The state Department of Education reported Thursday that there were sharp drops of both kinds of disciplinary actions during the 2012-13 school year - 14.1 percent in the former and 12.3 percent in the latter - from the previous year.

State schools chief Tom Torlakson hailed the trend, saying in a statement, "Educators across California work hard to keep students in school and learning. It can be a challenge to find the balance between maintaining a safe learning environment and giving young people the tools and opportunities they need to succeed. But we're working with schools and districts throughout the state to do exactly that."

While the declines were similar among all ethnic groups, black and Latino students still had suspension rates higher than their proportions of the state's six million K-12 students, while those of white and Asian students were lower.

Critics have said that school officials are too quick to rid themselves of troublesome students, often by citing "willful defiance" as the cause, and have pushed legislation to make such discipline more difficult. "Willful defiance" suspensions dropped 23.8 percent in 2012-13 while expulsions for that rationale declined by 18.6 percent.

Overall, suspensions decreased from 709,596 to 609,471 and expulsions from 9,758 to 8,562.

A bill making it more difficult to expel students for willful defiance, Assembly Bill 420, cleared the Assembly last year and is pending in the Senate. Gov. Jerry Brown vetoed two bills on the topic in 2012.

PHOTO: Actors Marcenus Earl as Principal Burton, left, and Donald Calhoun as Thomas play out a scene from a production called, "Willfull" in a hearing room at the state Capitol in Sacramento on Wednesday, June 26, 2013. The people in the play are students, community members and actors who are supposed to have had personal experience with harsh discipline. The Sacramento Bee/Randall Benton

Delivering his first "State of the CSU" address Wednesday morning, California State University Chancellor Timothy P. White said the system would focus on closing the state's expected degree shortage over the next decade.

Speaking at the CSU Board of Trustees meeting in Long Beach, White said that California's economy will need 1 million more college graduates by 2025, a rate of degree production about 40 percent higher than current levels.

"That outcome weighs heavily on our shoulders," White said, noting that CSU grants nearly half of the bachelor's degrees handed out each year in California.

White announced a $50 million project designed to boost graduation rates over the next ten years by 10 percent among undergraduates who started at CSU and 5 percent among community college transfers. (The current six-year graduation rates for those groups are 51.4 percent and 71.6 percent, respectively, according to the chancellor's office.)

Though light on specifics, he said the plan would invest in seven key areas to "advance student achievement and high-quality degree completion," including increasing the number of tenure-track faculty rather than relying on adjunct professors, offering more cross-campus online courses to deal with bottleneck scheduling and bolstering the Associate Degree for Transfer program at the community colleges.

"We care about the public good of the university through the success of our alumni and our overall economic and social impact," White said. "For us to meet our state's projected workforce need and grow the state's economy, it requires all of us to work together."

PHOTO: California State University Chancellor Timothy White speaks during the University of California, Riverside commencement ceremony on June 12, 2011. Riverside Press-Enterprise/Stan Lim

Automobile insurance companies would be banned from using motorists' occupation and education levels in establishing customer premiums under a rule change sought by consumer advocates Wednesday.

Consumer Watchdog formally requested that California Insurance Commissioner Dave Jones, the auto insurance industry's chief regulator, bar companies from engaging in the practice.

The so-called "affinity groups" -- including lawyers, doctors and college graduates -- are getting special premium benefits from the insurance companies at the expense of others, Consumer Watchdog founder Harvey Rosenfield said from Los Angeles.

"It's middle-income and low-income people, who don't have fancy jobs and didn't get a fancy education, who end up subsidizing the rich folks who get these special breaks," Rosenfield said.

The case pits the state's preeminent consumer groups against one of their staunchest political allies. Consumer Watchdog and Jones have teamed up on a November ballot measure to give insurance commissioners the authority to regulate proposed health insurance rate hikes.

Insurance commissioners already have rate authority over auto, property and casualty insurance based on 1988's Proposition 103 written by Rosenfield. On Wednesday, he said the group's only recourse should Jones refuse to take up its request is to take legal action against his department.

Jones' Department of Insurance issued a statement saying it would consider the petition once it is received. The department noted that in several previous rate applications, Consumer Watchdog agreed to settlements that included affinity groups "and are aware that no group subsidizes any other group."

In December, Jones allowed Allstate Insurance Company to use occupation and education level in establishing auto insurance rates.

"After a public hearing in which Consumer Watchdog was given the opportunity to present its arguments to an administrative law judge, the judge upheld the settlement allowing Allstate to have separate rates for affinity groups and found that the settlement was fundamentally fair, adequate, and reasonable," the insurance department said in its statement.

The agreement called for the company to institute an overall .2 percent rate reduction rather than the originally proposed 6.1 percent rate increase.

Consumer Watchdog then filed a request for reconsideration with Jones' office. The group argued that allowing the affinity groups was unfairly discriminatory and constituted ratings factors that were never adopted by regulation and violate the insurance code.

PHOTO: Insurance Commissioner Dave Jones speaks at a candidates forum at Sac State organized by the Asian Pacific Islander American Public Affairs Association in 2010. The Sacramento Bee/Hector Amezcua

The transformative potential of new aerospace technologies repeatedly became the focus of debate for the California Assembly on Wednesday.

Lawmakers overwhelmingly passed bills to cultivate California's burgeoning private spaceflight industry and to give more clarity to local agencies hoping to use unmanned aircraft systems, or UAS, commonly referred to as drones.

"The right answer is to embrace this technology because it is the future," said Assemblyman Jeff Gorell, R-Camarillo, after noting that other states have weighed outright bans on drones.

Assembly Bill 1327, sponsored by Gorell and two others, establishes the situations in which sheriff departments and state agencies can deploy drones. Law enforcement could use drones to monitor parks and forest fires without a warrant, for example, and non-law enforcement entities could obtain and use drones as long as they notify the public.

"Drones are going to be extremely important for hot pursuit, which is allowed in this bill, for search and rescue and, when you get a warrant, for continuous surveillance" of a location, said Assemblyman Bill Quirk, D-Hayward, a joint author.

The bill also addresses some of the privacy concerns spurred by the increasing prevalence of unmanned systems by requiring agencies to destroy drone-collected data within six months if it is not part of an ongoing law enforcement investigation. It would ban weaponized drones.

A separate measure by Assemblyman Al Muratsuchi, D-Torrance, would codify a ten-year tax break for properties used by the private space flight industry.

"With this bill California can grow and permanently establish this exciting new industry in our state," Muratsuchi said.

While members from both parties overwhelmingly backed Muratsuchi's bill, it drew criticism from Assemblyman Phil Ting, D-San Francisco, who warned about enshrining a tax break that could become difficult to dislodge.

A former San Francisco assessor-recorder, Ting referenced California's 1972 decision to offer tax relief to the then-nascent software industry, a decision Ting says has come back to haunt policymakers. He noted that removing tax exemptions require a two-thirds majority.

"I'm not saying that we shouldn't help SpaceX or the space industry," Ting said, referencing a Hawthorne-based firm, but he warned about setting a precedent in which "we'll be back here for some other giveaway for some other industry."

PHOTO: The Yamaha RMAX remote controlled helicopter sprays water over a vineyard at UC Davis' Oakville station in Oakville on Wednesday, June 5, 2013. The Sacramento Bee/ Randall Benton.

Gov. Jerry Brown has appointed Michael Picker, a senior adviser to the governor on renewable energy, to the powerful California Public Utilities Commission, Brown's office announced Wednesday.

Picker, of Sacramento, will resign his position with the administration before joining the regulatory board, Brown's office said. He will also resign from his seat on the Sacramento Municipal Utility District board, which he won in 2012, the administration said.

Picker, 62, was chief of staff to former Sacramento Mayor Joe Serna Jr. in the 1990s and worked as an adviser to both Brown and former Gov. Arnold Schwarzenegger.

Like Brown, Picker is a Democrat. He will fill the vacancy left when former Commissioner Mark Ferron announced his resignation due to health reasons earlier this month.

The position requires Senate confirmation. It pays $131,952 a year.

PHOTO: Michael Picker, 2012. Courtesy Michael Picker.

The California Supreme Court, which had been asked by Gov. Jerry Brown's administration to intervene in litigation challenging California's high-speed rail project, referred the case to a lower court Wednesday and ordered its expedited review.

The court transferred the case to the 3rd District Court of Appeal and ordered both sides to submit filings by Feb. 10.

The action comes after a Sacramento Superior Court judge in November ordered the California High-Speed Rail Authority to rescind its original funding plan for the $68 billion project. The court found the plan failed to comply with provisions of Proposition 1A, the initiative in which voters approved the project in 2008.

The Brown administration said in an appeal to the Supreme Court on Friday that lower court rulings "imperil" the project, threatening state and federal funding.

The troubled project is proposed to connect Los Angeles and San Francisco. The project has been delayed, with state officials now hoping to begin construction in the Central Valley this year.

PHOTO: A view of a high speed train moving through a wind farm in the proposed high speed rail network. Rendering by Newlands and Company Inc.

After a decade away from politics, Republican Ron Unz is plotting his return to the campaign trail.

Unz, the multimillionaire former gubernatorial candidate, credits as the inspiration for his comeback an unlikely figure: former U.S. Secretary of Labor Hilda Solis.

Then a Democratic state senator, Solis was the public face of a 1996 ballot initiative to raise the minimum wage to $5.75 an hour. Despite closely following a federal increase, the California measure passed with 61 percent of the vote.

"The numbers were so strong there really wasn't any opposition," Unz recalled in an interview.

Now, he's working to qualify a ballot measure of his own to lift the minimum wage to $10 per hour in March 2015 and $12 per hour a year later. The minimum wage is set to increase from $8 an hour to $9 an hour on July 1, and to $10 by 2016, under a bill signed last year by Gov. Jerry Brown.

Unz characterized his more rapid timeline as a win for taxpayers.

"What we are seeing is the classic case of businesses privatizing the benefits of their low-wage workforces and socializing the costs," he said.

His push comes amid renewed focus by both major political parties on income inequality ahead of the midterm elections for Congress. On Tuesday, President Barack Obama through an executive order said he would raise the minimum wage for federal contract workers to $10.10 an hour -- "because if you cook for our troops' meals or wash their dishes, you should not have to live in poverty," he said in his State of the Union Address.

Obama said he would continue to urge Congress to extend the hike to all workers, arguing that the federal minimum wage is worth about 20 percent less than it was when Ronald Reagan made the first of several annual addresses as president.

With California facing a massive teacher pension shortfall, Assembly Speaker John A. Pérez, D-Los Angeles, unveiled an effort Wednesday he hopes would fully fund the system.

An influx of revenue has allowed California to emerge from years of yawning deficits and protracted budget fights, and the pressure is mounting for the state to do something about an avalanche of liabilities that runs into the hundreds of billions.

Of those looming obligations, a substantial chunk comes from the gap between how much the California State Teachers Retirement System takes in and how much it will owe retired educators. Gov. Jerry Brown estimated in his budget this year that the liability has grown to $80.4 billion and would require a $4.5 billion annual infusion to balance the books.

"While we know our revenues will fluctuate up and down, our long-term liabilities are enormous and ever growing," Brown said in his State of the State speech earlier this month.

Pérez calculates the liability at $71 billion, somewhat lower than Brown. And on Wednesday, the speaker called for a plan that potentially includes increased contributions from all three contributors to the system -- the state, school districts and individual teachers.

"Further delays only mean further costs and further exposure for the state's General Fund," Pérez said. "The fix," he added, "must begin this year."

The process will likely get underway with a February hearing, said Assemblyman Rob Bonta, D-Alameda, chair of the Assembly Public Employees, Retirement and Social Security Committee.

"Since the contribution rates for CalSTRS are set by the Legislature and not the retirement board," as is the case with the California Public Employees Retirement System, "it is the responsibility of the governor and the Legislature to determine the best way to address the funding shortfall," Bonta said.

Regardless of how contributions from teachers and districts might change, Pérez said, California retains an obligation to support the retirement fund,

"The state created this fund in the first place," Pérez said, adding that "for us to suggest that we back out at this point would create an undue toll on those other funding sources.

PHOTO: Assemblyman Rob Bonta D-Alameda, in Assembly chambers in Sacramento, Calif. on Monday, March 11, 2013. The Sacramento Bee/Hector Amezcua

Gov. Jerry Brown's "Wall of Debt" doesn't include a big brick known as unfunded teacher pensions. Obligations to current and future retirees total $80.4 billion more than the California State Teachers' Retirement System has assets to cover.

Brown's budget summary earlier this month promised that his administration would begin working with the Legislature, teachers and CalSTRS to create a plan that would fully fund the pension system within 30 years. That will require at least $4.5 billion per year--and much more as the obligations continue to grow.

Assembly Speaker John A. Pérez and Assemblyman Rob Bonta, D-Alameda, take a first stab today during a news conference at 10 a.m. in Room 317 of the State Capitol. Pérez and Bonta, chair of the public employees, retirement and social security committee, will discuss ideas on how to address CalSTRS' unfunded liability.

VIDEO: If state Sen. Rod Wright loses his seat after being convicted of voter fraud, it will be a huge loss to the Legislature, Dan Walters says.

SOCAL CHRONICLES: Gov. Brown swings south today, attending the California State University Board of Trustees meeting in Long Beach before heading over to Beverly Hills to deliver remarks at a dinner hosted by the American Jewish Committee.

Speaking of the CSU, Chancellor Timothy P. White will deliver his first "State of the CSU" address at 11 a.m., sharing system-wide policy priorities and his vision for the next school year. The speech will be webcast.

ADULT ED HEARING: The Senate Education and Assembly Higher Education committees will hold a joint informational hearing on adult education, covering its recently history, current landscape and unmet needs in both community college and K-12 districts. Representatives from the California Department of Education, the California Community Colleges Chancellor's Office and the Legislative Analyst's Office, among others, are scheduled to testify at the 9 a.m. hearing in Room 4203 at the Capitol.

FREE CLINIC: As the flu season kicks into high gear, Anthem Blue Cross is sponsoring a free flu vaccine clinic in Room 127 of the State Capitol from noon to 4 p.m. The shots are available to the general public.

PHOTO: A bicyclist keeps her sweater handy with dark clouds looming as she rides in the shadow of the CalSTRS headquarters building on Riverwalk Park in West Sacramento on September 30, 2013. The Sacramento Bee/Manny Crisostomo

If state Sen. Rod Wright, D-Inglewood, loses his seat after being convicted of perjury and voter fraud, it would be a major loss of knowledge and common sense, Dan says.

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

See other Dan Walters Daily clips here.

PHOTO: Senator Rod Wright, D-Inglewood listens to the vote on the budget plan on Feb. 18, 2009. The Sacramento Bee/Brian Baer

Republican Neel Kashkari, criticizing Gov. Jerry Brown for his support of California's high-speed rail project, released a web ad Tuesday panning it as "a symbol of Sacramento having the wrong priorities."

The online-only ad, the first issue ad of Kashkari's campaign, comes a week after the former U.S. Treasury Department official announced his candidacy for governor.
In the video, Kashkari, wearing blue jeans and seated in a leather chair, calls the project the "crazy train."

"To me, it is not only a waste of money, it is a great example, it is a symbol of Sacramento having the wrong priorities," Kashkari says in the video. "If I were elected governor, we're going to cancel the bullet train and we're going to focus on the state's real priorities, which are jobs and education."

Yet the project's proposed financing includes a mix of sources including state bond funds, federal aid and private investment. Kashkari has yet to issue detailed policy proposals for education or jobs creation, his stated priorities, and he has not said how he would craft a state spending plan.

The $68 billion rail project is an issue Republicans believe they can exploit in attacking Brown. The Democratic governor is heavily favored in his likely re-election bid this year, but public support for the troubled project, a priority of Brown's administration, has fallen off since voters approved it in 2008.

The project, which is planned to connect Los Angeles and San Francisco, is beset by legal challenges. The Brown administration on Friday asked the California Supreme Court to intervene in two lower court rulings that jeopardize its funding.

PHOTO: Neel Kashkari speaks at an interview with The Associated Press in Sacramento on Dec. 4, 2013. Associated Press/Rich Pedroncelli

With California preparing to offer driver's licenses to immigrants in the country illegally, the documentation needed to prove residency and the fate of personal information emerged as key concerns at a Department of Motor Vehicles hearing on Tuesday.

Gov. Jerry Brown last year signed a bill creating special licenses for immigrants, capping years of effort by Democratic lawmakers and immigration advocates. Now the action moves from the Legislature to the DMV, which is at work crafting regulations.

Dozens of people, many speaking in Spanish through interpreters, lined up on Tuesday to ask about how the process will play out.

The question of documentation was a dominant theme. Many speakers urged the DMV to accept a broad range of evidence establishing California residency, noting that many immigrants lack other forms of identification. Ideas included utility bills, baptismal certificates and union identification cards.

"You can put together where people live and that they're part of a community by taking a flexible approach," said Eric Vega, a professor at California State University, Sacramento and a member of the Sacramento Immigration Alliance.

Countering that call for a broader approach was Shelia Byars, a DMV driver safety hearing officer who warned of seeing "fraud out of control" during her 18-year career.

"A utility bill, for me, does not establish residency," Byars said. "If we're looking at other ways of establishing identity," she added, "then I think we need to go deeper than check-cashing cards and utility bills."

As the Legislature debated creating the licenses last year, the legislation's author for a time planned to shelve the legislation amid concerns that the distinct markings on the IDs - federal law requires a feature distinguishing the cards from traditional licenses - would expose immigrants to discrimination and potential deportation.

Those worries surfaced again on Tuesday. A speaker from the Coalition for Humane Immigrant Rights of Los Angeles asked the DMV to reassure immigrants about how application information will be used, "so we won't be full of fear." Others wondered whether the licenses could be used to reveal someone's immigration status in court.

"In a court of law or administrative process, that will create a stigma to the person judging them, whether a judge or a jury," said Noe Paramo of the California Rural Legal Assistance Foundation.

Assembly Bill 60 requires applicants to sign an affidavit saying they are ineligible for a Social Security number and cannot prove lawful presence. While the legislation contains language prohibiting discrimination on the basis of the licenses and a DMV official noted on Tuesday that the affidavits will not be public documents, advocates remain wary.

"We're very, very worried about this affidavit requirement because potentially it could have consequences in immigration proceedings - not only the affidavit but the license itself essentially becomes evidence the person is here unlawfully," Ronald Coleman of the California Immigration Policy Center said ahead of the hearing.

The potential cost of the licenses also fueled concern among speakers, with many speakers saying high fees would discourage working-class immigrants from obtaining the licenses.

"We also want to make sure that these driver's licenses are accessible," Coleman said. "We don't want there to be overly burdensome fees to impede community members from getting these licenses."

A Senate analysis found that offering the licenses could cost between $140 million and $220 million over three years, and Brown's 2014-2015 budget proposal seeks $64.7 million to accommodate an expected surge of interest with additional staff and temporary field offices.

PHOTO: Gov. Jerry Brown signs a driver's license bill for undocumented immigrants in Fresno City College in Fresno, Calif on Thursday, October 3, 2013. The Sacramento Bee/Hector Amezcua.

Most health insurance plans offered on the state exchange will now feature quality ratings, giving consumers a better idea about their past performance.

Covered California, the state exchange, announced Tuesday that it recently incorporated the quality-rating system in its website, with marks ranging from four stars for the highest performers down to one star for the lowest.

Federal law requires the rating of plans, but officials here noted that the rating system's California debut comes about two years ahead of the mandate. Executive Director Peter V. Lee said his exchange is among the first in the nation to offer consumers a quality-rating system.

"We want to give consumers all the available tools to help them assess and choose plans in their regions," Lee said. "We are proud of the ratings in each of the exchange plans and recognize this is a preliminary look at exchange health plans."

Lee previously expressed concern that incorporating the ratings for some plans and not others would dissuade people from enrolling. His original recommendation called for implementing the ratings system for all plans offered on the exchange during open enrollment in 2015.

Health policy groups and highly-rated plans suggested the exchange simply add language to those plans explaining they had yet to receive any ratings. They sided with exchange board members who strongly recommended adding the ratings as soon as possible.

"We are pleased that those are in place and that folks can take advantage of it," said Anthony Wright, executive director of Health Access California. He also expressed gratitude that the exchange "didn't go down the path that everybody got four stars."

Ratings are a key tool for customers and an important signal to insurers, Wright said. As the exchange and insurers begin negotiations for next year's plans, insurers know that the exchange will look at consumer ratings as well as price, he said.

The ratings, based on consumer experiences, will be familiar to users of Amazon and Yelp where customers assign grades to products, movies and restaurant experiences. In this case, each insurance plan in the marketplace is compared with plans across the western region of the country.

Scores come from the Consumer Assessment of Healthcare Providers and Systems. Four-star plans placed in the top 25 percent of all of those rated. Three, two and one stars were awarded to plans ranking 50-to-75 percent, 25-to-50 percent and 0- to-25 percent, respectively.

PHOTO: The executive director of Covered California, Peter V. Lee, speaks to members of the media during the launch of Covered California in Rancho Cordova on Oct. 1, 2013. The Sacramento Bee/Randall Benton.

A Los Angeles jury today convicted Sen. Rod Wright on all eight felony counts he was charged with in the case that questioned whether he lived in the district he represented, potentially sending the Democratic state legislator to eight years in prison.

A sentencing hearing has been scheduled for March 12.

Wright will not automatically lose his seat in the Senate, according to Senate secretary Greg Schmidt. That would only happen if two-thirds of the 40-member Senate votes to expel him.

State law requires legislative candidates live in the district they seek to represent. Prosecutors in Los Angeles alleged Wright did not live in the Inglewood home he listed as his address when he ran for office in 2008, and instead lived in Baldwin Hills, a swankier community outside the boundaries of his working-class district. They charged him with eight felony counts -- two counts of perjury, one count of filing a false declaration of candidacy and five counts of fraudulent voting.

Wright pleaded not guilty, and argued he met all the legal criteria for running in what was then the 25th Senate District, including moving possessions into the Inglewood home he had owned since 1977 - where the woman he considers his stepmother lives - and registering to vote at the address.

A major focus of Wright's trial in Los Angeles Superior Court was the legal distinction between a "domicile" - a long-term home - and a "residence," or temporary dwelling. Wright said he bought the Baldwin Hills home in 2000 to use as an office for his real estate investment business and never considered it his legal domicile.

Neighbors testified that they routinely saw Wright at the Baldwin Hills house, while Wright's tenant at the Inglewood home testified she had never seen him spend the night or fix a meal in Inglewood, according to the Los Angeles Times.

Yet Wright testified that he never claimed a homeowners tax exemption, registered to vote or applied for a driver's license using the Baldwin Hills address. He cited a Tuolumne County case in which the court ruled that a local official could claim a home she once lived in as her legal domicile even though she had moved away.

Senate leader Darrell Steinberg said he would consult with lawyers and colleagues before deciding whether the upper house will take any action against Wright.

"Senator Wright is a well regarded colleague," Steinberg said, conveying visible sadness as he talked about the verdict.

Here's a video of Steinberg responding to the verdict moments after it came in:

PHOTO: Sen. Rod Wright in the state Capitol on August 20, 2009. The Sacramento Bee/Hector Amezcua

Editor's note: This post was updated at 12:55 p.m. to include the sentencing date and a response from Senate President Pro Tem Darrell Steinberg.

Proponents of a proposed ballot measure to more than double the vehicle-license fee to pay for road improvements have decided to drop efforts to put it on the November ballot.

The "California Road Repairs Act of 2014" would have phased in a 1 percent hike in the license fee -- the equivalent of property tax on a home -- to raise from $3 billion to $4 billion annually. The fee has been .65 percent of a vehicle's market value since the late 1990s, with a temporary increase to 1.15 percent from May 2009 through June 2011.

But Monday, Will Kempton, the executive director of Transportation California, said his group and the California Alliance for Jobs "have decided to put our initiative on hold."

"We'll continue to work with stakeholders, the Legislature, the administration and the public to identify and implement a solution to our transportation infrastructure problems," Kempton, a former Caltrans director, said in an e-mail.

The measure had been cleared earlier this month to begin collecting signatures to qualify for the ballot.

Kempton and other supporters point to a huge backlog of road improvement projects in California, with little new money to pay for them. Yet supporters also were well aware of the difficulty in getting the public to back an increase in the license fee, which has a prominent place in the mindset of the state's car-centric culture.

Past increases have not been popular. In mid-2003, then-Gov. Gray Davis raised the fee to 2 percent, what it had been before lawmakers began reducing it in the late 1990s. The increase contributed to his defeat in the recall election that October and the victory of Arnold Schwarzenegger.

PHOTO: Will Kempton, the then-director of the California Department of Transportation, testifies before the Assembly Transportation Committee in 2005. The Sacramento Bee/John Decker

For more than a decade, California lawmakers worked to pass legislation allowing undocumented immigrants to obtain driver's licenses in the state.

After numerous failed efforts and one close call -- in 2003, then-Gov. Gray Davis signed a bill that was repealed by Arnold Schwarzenegger before it became law -- Gov. Jerry Brown finally signed AB 60 last October. The Department of Motor Vehicles is expected to begin issuing special licenses by 2015.

Now comes the hard part.

One of the biggest battles over granting driver's licenses to undocumented immigrants was whether those identification cards would be somehow visually distinct from licenses for legal residents. When AB 60 finally passed, it was with an amendment requiring a distinguishing mark on the front and back of the immigrant license. Those details, however, still must be worked out.

At 10 a.m., the California DMV conducts it first public hearing to assist in the development of regulations for the implementation of AB 60, including what documents will provide sufficient proof of identity and state residency to apply for a license. The meeting takes place in the auditorium of the Secretary of State building at 11th and O streets. A live webcast will also be available.

VIDEO: The bond fund that finances school construction and repairs has run out, but Gov. Jerry Brown is unlikely to support placing a new one on the November ballot, Dan Walters says.

DON'T DEPORT: In more immigration news, state Sen. Ron Calderon, D-Montebello, hosts a press conference at 9 a.m. in Room 3191 of the Capitol calling upon President Barack Obama to stop the deportation of undocumented immigrants who are eligible to become legal citizens. Calderon introduced a similar resolution to the Senate last week, the first bill his office has promoted since he made headlines last fall in an FBI corruption investigation. The event is part of part of a national day of action organized by the Protect Our Families Campaign.

METHODS REVIEW: The recently declared drought has only fanned the flames of controversy surrounding the Bay Delta Conservation Plan, which proposes constructing two enormous tunnels to bring water under the Sacramento-San Joaquin Delta to southern California. Over the next two days, an independent science panel meets to discuss the scientific soundness of the plan's "effects analysis" section, which assesses the likely impact of the tunnels on species of concern and the ecological process of the Bay-Delta system. The meeting begins today at 8:30 a.m. at the Red Lion Hotel Woodlake Conference Center.

INSURANCE EVALUATION: The California Office of the Patient Advocate releases its annual California Health Care Report Cards at 9:30 a.m., rating the commercial insurance offered by the state's ten largest health maintenance organizations, six largest preferred provider organizations and over 200 medical groups.

LEGISLATIVE DIRECTORY: Every lawmaker, with their staff and their committees, is available at your fingertips on the Capitol Alert Insider Edition app. Subscribe here for iPad and iPhone.

PHOTO: A customer waits in line at the Department of Motor Vehicles office in south Sacramento on Aug. 17, 2006. The Sacramento Bee/ Randall Benton

The bond fund that finances school construction and repairs has run out, but Gov. Jerry Brown is unlikely to support placing a new one on the November ballot, Dan says.

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

See other Dan Walters Daily clips here.

PHOTO: Pleasant Grove High School students get off their bus onFeb. 20, 2009. The Sacramento Bee/Hector Amezcua

By Michael Doyle
McClatchy Washington Bureau

California can keep its strict animal welfare standards after all under a long-awaited farm bill finished by congressional negotiators early Monday evening.

As they wrapped up the overdue legislation, lawmakers dropped a controversial House provision that would have blocked California and other states from imposing stricter animal confinement rules. The decision clears the way for more California lawmakers to support the multi-billion dollar bill that funds both crop subsidies and food stamps.

"This is a victory for state's rights," Rep. Jeff Denham, R-Calif., declared Monday, adding that that the omitted animal welfare provision "would have led to a race to the bottom for agriculture production laws nationwide...and imperiled the fate of California egg producers."

Two years late, the farm bill now set for House approval on Wednesday spans 959 pages and authorizes myriad agriculture, conservation, research and nutrition programs. Once a relatively routine legislative exercise conducted every five years, this latest farm bill has until now stymied House Republicans who had initially pushed for much steeper cuts in the Supplemental Nutrition Assistance Program, formerly known as food stamps.

The final farm bill cuts the supplemental feeding program by roughly $8 billion over 10 years, compared to a $39 billion cut originally passed by House Republicans. The savings primarily come from tightening a current system that has tied nutrition program eligibility to receipt of a very small amount of fuel aid.

"We're still providing support for those who are most in need," Rep. Jim Costa, D-Calif., said Monday. "I think, given all the difficulties we've faced, and while there are things I wish were different, that this bill seems like something I can support."

A three-page veto message from Gov. Jerry Brown isn't stopping Sen. Jim Beall from his effort to allow victims of molestation more time to sue their abusers.

The San Jose Democrat said today that he plans to introduce two new bills on the issue later this week, despite the unusually long veto message his SB 131 got from the governor last year. In rejecting Beall's measure to extend the statute of limitations for civil suits against abusers, Brown wrote that limiting the window of time for seeking retribution goes back to Roman law and is an issue of basic fairness.

SB 131 was one of the most heavily lobbied bills of 2013, with the political arm of the Catholic Church working hard to defeat it. Opponents argued the bill unfairly went after abusers in the private sector while not allowing victims of public institutions any additional opportunity to sue. Supporters said the extra time would allow people who had suppressed memories to seek justice when they are recovered.

Beall said his new bills -- one addressing criminal law, the other civil law -- include some major changes he hopes will satisfy the governor. Instead of opening up an opportunity for past victims to sue their abusers, the new bills would address future cases. The bill changing the civil statute of limitations would apply to both public and private entities, and change the current age cut-off from 26 to 40 for victims to sue.

"Hopefully he'll find more agreement with these two bills that look forward prospectively in terms of the statute of limitation laws, similar to Minnesota, Illinois, Florida and other states, as opposed to the previous bill, which looked backwards," Beall said.

"These two bills both apply to any and all people, not public versus private. That issue has been dealt with in these two bills."

PHOTO: Senator Jim Beall, D-San Jose, in the Senate chambers on March 11, 2013. The Sacramento Bee/Hector Amezcua

The state's health insurance exchange is handing out six-figure contracts to a pair of consultants and a new marketing director that officials say will enhance the sustainability and help expand the program.

Covered California Executive Director Peter V. Lee said the consulting contracts would give the agency the "the exceptional staff and resources we need to make history."

Jeffrey Rideout will stay on as senior medical adviser on a one-year contract worth more than $411,000. A consultant in the areas of clinical quality, network management, delivery system reform and clinical and network analytics, Rideout previously served in senior executive and chief medical officer positions with Cisco Systems and Blue Shield of California.

"I think Jeff really has provided great leadership to us partnering with consumer advocates, with clinicians, with out health plans, really about how do we make sure that our consumers get the best quality care possible," Lee said last week.

Rideout is on the faculty at the University of California, Berkeley Haas School of Business. He also works as a consulting professor at Stanford University in the Department of Health Research and Policy. Terms of his previous contract were not immediately available.

Ana Matosantos, who until recently served as the state's finance director, will advise state exchange leadership and staff in "financial sustainability and budgeting issues, and evaluation analytics," according to a news release.

Matosantos, who will earn $20,000 a month on a six-month contract, served in the administrations of Govs. Jerry Brown and Arnold Schwarzenegger. She previously worked in the California Health and Human Services Agency and for the state Senate.

"There's few people as sharp as Ana in understanding not just numbers but how to put the numbers in context," Lee said.

To help oversee tens of millions in advertising and dollars, Garrison Rios was named director of communications and marketing. Rios was a director for Monterey Park-based Care1st Health Plan. At Covered California, he will lead the a newly created position in charge of planning, monitoring and controlling communications, public relations and marketing, Lee said.

Rios is tentatively scheduled to start Feb. 3, and will earn $165,000 a year.

PHOTO: Ana Matosantos, then the state finance director, converses with Natalie Cardenas of Anthem Blue Cross after Matosantos spoke to business leaders about Gov. Jerry Brown's budget proposal on Jan 13, 2011. The Sacramento Bee/Hector Amezcua

California needs as much as $12 billion in additional school-building money and almost $5 billion in modernization money, according to estimates in a report to the state board that oversees school-construction dollars.

Voters have approved about $35 billion in school-construction and modernization bonds since 1998, most recently in 2006. But the money is nearly exhausted amid talk of crafting another school bond for a future ballot.

Officials, though, have called for changes to the state School Facility Program that awards bond funding. Last Wednesday's report to the State Allocation Board by the subcommittee on the school facility program included recommendations to discourage the use of bond money for portable classrooms, to require districts to commit to spend money maintaining bond-funded buildings, and to conduct an inventory of all school facilities.

The report does not suggest a specific dollar amount for a future school bond. The state needs anywhere from $6 billion to $12.3 billion in school-construction dollars, according to the report, and about $4.7 billion in modernization funding.

Gov. Jerry Brown also has raised concerns about the cost to the state of borrowing to build schools. In his budget proposal earlier this month, Brown wrote that a revamped school-construction program should "avoid an unsustainable reliance on state debt issuance that characterizes the current school facilities program."

The subcommittee included representatives of the Brown administration, schools superintendent Tom Torlakson, Assemblyman Curt Hagman, R-Chino Hills, and Assemblywoman Joan Buchanan, D-Alamo, who leads the Assembly Education Committee.

Buchanan is crafting school-bond legislation for the November ballot that will reflect some of the report's recommendations.

PHOTO: At right, Maiya Miller hugs Principal Shana Henry on the first day of school at Pacific Elementary school in Sacramento on Tuesday, September 3, 2013. The Sacramento Bee/Renee C. Byer

Stephen Glass, a former journalist whose career came crashing down after he was found to be a serial fabricator, has had his quest for a law license stymied by the California Supreme Court.

Glass in his 20s wrote acclaimed stories for The New Republic and Rolling Stone, repeatedly concocting events in more than 40 articles during the late 1990s.

A person must be of good moral character to practice law in the state. After a state bar court hearing four years ago, Glass presented several character witnesses and introduced evidence regarding a lengthy course of psychotherapy along with his own testimony and other evidence.

Many of those efforts, stretching from the time he was exposed in 1998 to the hearing in 2010, "seem to have been directed primarily at advancing his own well-being rather than returning something to the community," the justices wrote in their 35-page decision Monday.

"His evidence did not establish that he engaged in truly exemplary conduct over an extended period," the decision said. "We conclude that on this record he has not sustained his heavy burden of demonstrating rehabilitation and fitness for the practice of law."

The story of Glass' fall was depicted in the movie "Shattered Glass."

PHOTO: Stephen Glass, former writer for The New Republic, is seen in this video framegrab released by CBS' "60 Minutes, " Wednesday, May 7, 2003, in New York. Next week Simon & Schuster will publish Glass' "The Fabulist, "an autobiographical - but invented - account of his rise and fall at The New Republic. The magazine fired Glass in 1998 after determining there were fabrications in 27 of the 41 articles he had written. AP Photo/ CBS News

It's do-or-die time for legislation introduced in 2013.

Many of last year's holdover bills met their demise last week when they failed to advance from committee, and this Friday, they face another major deadline to get out of their house of origin.

As a result, the Legislature will be in overdrive this week. Though they typically only meet on Mondays and Thursdays, both the Senate and the Assembly have scheduled up to four floor sessions to get through everything. About 30 2013 bills are pending in the Senate, while the Assembly has more than 50.

The Senate plans to meet Monday at 2 p.m., Tuesday at 10 a.m., Wednesday at 10 a.m. and Thursday at 9 a.m. The Assembly has scheduled floor sessions for Monday at noon, Wednesday at 11 a.m. and Thursday at 9 a.m., with a Friday session on call if necessary.

VIDEO: New term limits and a majority freshman Assembly are leading to big changes in the Legislature, Dan Walters says.

GRAND OLD PARTY: The California Republican Party hosts its annual back-to-session bash tonight at 5:30 p.m. at Ella on K Street. Tickets start at $2,500. Here's hoping Coolio makes an appearance!

CUT THE RIBBON: And the soirees continue. Elizabeth Emken -- who ran against U.S. Sen. Dianne Feinstein in 2012 and is one of three Republican challengers to Rep. Ami Bera, D-Elk Grove -- hosts the grand opening of her campaign headquarters in Rancho Cordova at 5:30 p.m. Assembly members Kristin Olsen, R-Riverbank, and Don Wagner, R-Irvine, are scheduled to make an appearance at the event. Bera's 7th Congressional District is expected to be among the state's most competitive House races this year; Bera won with 51 percent of the vote in 2012.

NEW JOB: Congratulations to Elizabeth Stitt, former senior press aide to Assembly Speaker John A. Pérez, who starts work as a consultant with public affairs firm Swanson Communications today.

SNEAK PEEK: Why wait for the morning paper? We give you an early look at Sacramento Bee editorials and cartoons with Capitol Alert Insider Edition. You can download the app for iPad or iPhone here.

PHOTO: Twenty-eight of the new Assembly Members undergo orientation inside the Assembly Chambers on Nov. 12, 2008. The Sacramento Bee/Brian Baer

With Southern California politicians set to take control of both houses, new term limits and a majority freshman Assembly, the California Legislature could begin to look very different, Dan says.

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

See other Dan Walters Daily clips here.

PHOTO: Senators Kevin de Leon, D-Los Angeles talks with Senator Rod Wright, D-Inglewood during legislative informational hearings on gun laws on Jan. 29, 2013. The Sacramento Bee/Hector Amezcua

The Brown administration, which previously downplayed the significance of court rulings against California's $68 billion high-speed rail project, asked the California Supreme Court to intervene on Friday, saying the rulings "imperil" the project, threatening state and federal funding.

The request to the California Supreme Court comes after a Sacramento Superior Court judge in November ordered the state to rescind its original funding plan for the project. The lower court ruled the California High-Speed Rail Authority failed to comply with provisions of Proposition 1A, the initiative in which voters approved initial funding for the project in 2008.

The administration said in a request for expedited review that "the trial court's approach to these issues cripples government's ability to function" and could have implications for other infrastructure projects.

The state argues the normal appeals process could take years to resolve and is "not a real choice."

"Since the project's inception, opponents of high-speed rail have tried to block its construction," the filing said. "Now, two rulings of the Sacramento Superior Court - which are otherwise unreviewable as a practical matter - imperil the project by erecting obstacles found nowhere in the voter-approved bond act."

PHOTO: A view of a high speed train moving through a wind farm in the proposed high speed rail network. Rendering by Newlands and Company Inc.

State Controller John Chiang lacks the authority to determine whether a budget approved by the California Legislature is balanced, a court ruled, handing another legal victory to lawmakers whose pay he docked amid a standoff in 2011.

Chiang based his denial of legislative pay on a finding that lawmakers failed to pass a balanced state budget in an attempt to get in under a voter-approved pay deadline. The 3rd District Court of Appeal in Sacramento unanimously upheld a 2012 lower court decision, concluding that lawmakers must merely enact a budget bill in which revenue estimates for the coming year exceed the total of existing appropriations.

"At that point, the Controller does not have the authority to make an independent assessment that the budget bill is not in fact balanced because it relies on revenues not yet authorized in existing law (or in enrolled legislation) and on that basis withhold the salaries of legislators as a penalty for failing to enact a timely budget," the court said in its decision published Friday.

Chiang called the ruling a setback for important reforms voters made to the budget process three years ago.

"The ruling adopts the Legislature's argument that a budget is balanced if it -- without any independent verification -- says it is so," he said in a prepared statement. "This is a loophole that undermines the voters' desire to only pay lawmakers when they discharge their most important and fundamental duty -- to pass a budget that is both timely and truly balanced."

In 2010, California voters passed Democratic-backed Proposition 25 requiring lawmakers to surrender their pay and daily per diem checks for every day they exceed the June 15 deadline. The same law permitted them to pass budgets on a majority vote rather than two-thirds, a considerably higher feat requiring bipartisan action.

Following Chiang's action, the legal challenge was launched by Senate President Pro Tem Darrell Steinberg, D-Sacramento, and Assembly Speaker John A. Perez, D-Los Angeles. The filing specifically stated the Legislature was not seeking back pay.

Sacramento Superior Court Judge David I. Brown in 2012 ruled Chiang assumed budget duties reserved for lawmakers. The ruling essentially said the Legislature was free to determine whether a budget was balanced under the state constitution.

"The Legislature consistently made the necessary tough budget decisions over the last five years," Steinberg said Friday. "California is in much better shape as a result. Today's unanimous court decision is further affirmation of our difficult and responsible decisions."

PHOTO: California Controller John Chiang speaks at the Bee Capitol Bureau in 2011. The Sacramento Bee/Hector Amezcua

National Republicans today moved to dramatically curtail the process by which they select a presidential candidate, including granting a special exemption to California.

The new rules are meant to shave off months of 2016 infighting by tightening the primary schedule and moving up the national convention. The party would impose strict penalties for states that move their selection dates out of order, such as Florida and Michigan did in recent years.

It would essentially compress the schedule from nine months to five months, from Jan. 1 to about May 15. It also requires a 45-day window between any delegate-selection process and the convention.

But California, New Jersey and New Mexico could keep their later primaries without penalty, and still be seated at the national convention a few weeks later.

RNC Chairman Reince Preibus described the changes as "a historic day for our party."

Shawn Steel, a Republican National Committeeman from California, said the waiver for California was a necessity. "That's been locked in," Steel, who fought for the automatic waiver, said by phone from the winter meetings in Washington. "There was just no way that California could ever be excluded from the national convention. We are the largest party in the country, we got 5 million registered Republicans, that's more people than most states have in their entire population."

Given the late date of California's primary - it's now scheduled for June 7 - it's unlikely the Golden State would have an impact on the GOP nomination, Steel said. "It's entirely possible, if not likely, that the nominee will have all of the votes that he needs by May 15 without California," he said. "If it's a robust primary with robust candidates, we could still make the difference. Either way, the so-called 45-day (convention) cutoff rule doesn't impact us."

Another set of guidelines to be voted on this spring is designed to reduce the marathon schedule of debates as well as establish the sponsoring television networks.

"The bottom line is you'll never see George Stephanopoulos asking Republican candidates questions again," Steel said.

PHOTO: Shawn Steel, then-chairman of the California Republican Party, urges the recall of Gov. Gray Davis as he appears at a rally on the north steps of the State Capitol Building Feb. 22, 2003.

Union membership declined in California last year, the federal Bureau of Labor Statistics says in a new report.

The drop was from 2.5 million in 2012 to 2.4 million in 2013 and from 17.2 percent of the state's 14-plus million public and private workers to 16.4 percent, the BLS said in a nationwide report on union representation.

Other data have shown that the bulk of California's union membership is among school system and state and local government workers.

Nationwide, union members remained static at 11.3 percent of all workers. New York has the highest level of union membership, 24.4 percent, while North Carolina has the lowest, 6.4 percent.

PHOTO: Dennis Maxey, center, a Transbay Terminal worker from Oakland, joins members of SEIU Local 1000, representing 95,000 state employees as they rally at the Capitol on Wednesday, July, 1, 2009. The Sacramento Bee/Hector Amezcua

When California's political watchdog fined two conservative groups $1 million last year for not properly reporting $15 million in campaign contributions, it also told the recipients of the money to turn it over to the state.

At the time, one of the recipients -- the Small Business Action Committee -- put up a fight and said it had spent up all the money it had received and didn't plan to pay the state a dime.

The group is now changing course.

Today, the Fair Political Practices Commission announced that the Small Business Action Committee headed by Joel Fox has paid the state $300,000.

The money amounts to less than 3 percent of the $11 million the group received from Americans for Responsible Leadership, the Arizona-based group that admitted in October it had not properly reported its donations. Still, the FPPC's chief of enforcement said the payment is significant -- the second largest California has ever collected.

"$300,000 is a lot of money to any committee," said Gary Winuk.

"The purpose of the disgorgement law is to make sure even if you give a contribution and don't disclose the true source that every party down the chain is going to suffer the consequences, and I think that happened here."

The FPPC's pursuit of the campaign finance case has been watched around the country.

The Small Business Action Committee and another group called the California Future Fund were raising money to support Proposition 32 and oppose Proposition 30 on the November 2012 ballot. They received money from groups that acted as intermediaries in a large network of conservative fundraising groups with ties to industrialists Charles and David Koch, though the FPPC never uncovered evidence that the Koch brothers were themselves donors to the California effort.

By passing the money through several nonprofits, the groups were able to shield individual donors from being publicly identified as backing the effort to defeat Gov. Jerry Brown's tax measure and pass one that would make it harder for labor unions to mount political campaigns.

The California Future Fund is supposed to pay the state $4.08 million it received from a group that improperly reported its contribution. But Winuk said he thinks it's "extremely unlikely" that California will collect any more money in this case.

Fox, president of the Small Business Action Committee, said his group did nothing wrong in accepting the $11 million contribution but decided to pay some money to the state to put the issue to rest.

"We understood that fighting this lawsuit would incur large attorney fees and could be tied up in court for years," Fox said in a statement.

"Given that this is an election year with important issues we want to be engaged in, SBAC chose to put this lawsuit behind us."

Editor's Note: This post has been updated to include a response from Fox, clarify the Koch brothers' connection to the case and clarify that the the $300,000 is not a fine under the law.

PHOTO: Joel Fox. Courtesy of the Small Business Action Committee.

A state Senate report released Wednesday revealed what was apparently a deliberate cover-up of construction lapses on the eastern span of the Oakland-San Francisco Bay Bridge. The project was plagued by structural problems, including snapped steel rods, before it opened last September, years behind schedule and billions over budget. Tests and repairs continue.

Among the report's key revelations is the allegation that quality control managers found thousands of cracks in welds produced by a Chinese contractor. Rather than ordering the needed fixes, top managers from the California Department of Transportation replaced those who discovered the problems.

The report sets the stage for an informational hearing of the Senate Committee on Transportation and Housing at 10 a.m. in Room 4203 of the Capitol building. Sen. Mark DeSaulnier, D-Concord, who chairs the committee, told The Bee that he was "shocked" by the claims of a cover-up and blamed Caltrans' "insular culture."

Among those scheduled to testify at the hearing are Caltrans director Malcolm Dougherty and several other engineers and officials from the agency. It will be Caltrans' first public response to the accusations in the report.

VIDEO: More people are leaving California for other states these days than moving here, Dan Walters says.

FUNDING FLAP: In a campaign finance case watched around the country, California's Fair Political Practices Commission demanded last October that two political action committees repay the state $15 million in contributions they had improperly reported. FPPC Enforcement Chief Gary Winuk will announce new action on the case at 10 a.m. at the FPPC building on J Street.

DEMOCRACY IN ACTION: State Sen. Jerry Hill, D-San Mateo, will be in Millbrae at 10 a.m. to announce the winner of his "Oughta Be A Law...Or Not" contest. The bill provides recourse for students whose scores for Advanced Placement exams or other standardized tests are cancelled because of "testing irregularities." Assemblyman Kevin Mullin, D-South San Francisco, will also be on hand to introduce companion legislation requiring test providers to release invalidated scores if there is no evidence of student misconduct.

SWEARING IN STYLE: This is a grand welcome to the state Legislature: Sebastian Ridley-Thomas, a freshman assemblyman from Los Angeles who won a special election in December, will be sworn in by California Attorney General Kamala Harris at a special community ceremony. Harris did the same earlier this month for state Sen. Holly Mitchell, D-Los Angeles, who previously held Ridley-Thomas' seat. The ceremony takes place Sunday at 2 p.m. at West LA College in Culver City.

TRACK BILLS ON MOBILE: What bills bear watching? Get automatic updates with the new Capitol Alert Insider Edition bill-tracking feature. You can download the app for iPad or iPhone here.

CELEBRATIONS: Happy birthday to state Sen. Lou Correa, D-Santa Ana, who turns 56 today.

PHOTO: The new eastern span of the San Francisco-Oakland Bay Bridge on December 4, 2013. The Sacramento Bee/Manny Crisostomo

Though births and foreign immigration keep California growing, more residents are leaving the state than coming these days, Dan says.

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

See other Dan Walters Daily clips here.

PHOTO: Immigrants take an oath of citizenship at a naturalization ceremony at Raley Field in West Sacramento on July 10, 2012. The Sacramento Bee/Renee C. Byer

Disposable plastic bags would be banned from grocery check-out stands in California and consumers would pay at least a dime for a paper or re-usable plastic bag a under a compromise proposal negotiated with key opponents of last year's bill to ban plastic shopping bags.

Lawmakers plan to unveil the deal tomorrow at a Los Angeles-area manufacturing plant.

Senate Bill 270 seeks to temper some manufacturing industry opposition by providing $2 million from state recycling funds. Plastic bag makers would be able to apply for grants to re-train their workers or re-engineer their operations to make plastic bags that meet new criteria spelled out in the bill.

The legislation is a joint effort by Sen. Alex Padilla -- the Los Angeles Democrat who authored last year's failed attempt to ban plastic bags -- and two of his colleagues who killed that bill, Sen. Kevin de Leon, D-Los Angeles, and Sen. Ricardo Lara, D-Bell Gardens. De Leon and Lara both have plastic bag factories in their districts and said last year that Padilla's SB 405 would eliminate too many jobs for their working-class constituents.

The three senators plan to introduce their new proposal at the Command Packaging plant in Vernon tomorrow, along with labor and environmental leaders.

Under their proposal, consumers would pay a minimum 10 cent fee for every shopping bag. Only plastic bags that meet certain thresholds for containing recycled content and being strong enough for more than 125 uses would be available in California. Re-usable plastic bags for sale in California would have to contain at least 20 percent recycled plastic, a bar that would go up over time to 40 percent, said Mark Murray, executive director of Californians Against Waste.

"We're trying to develop a criteria for an evolving market place," he said.

The bag requirements would take effect at large grocery stores in 2015 and at pharmacies and liquor stores in 2016.

PHOTO: Courtesy clerks Christia Johnson-Williams left, and Heather Roberts fill plastic bags with groceries at the Safeway store in midtown Sacramento on Monday June 11, 2007. The Sacramento Bee/Randall Benton

SALINAS — One day after delivering his State of the State address, Gov. Jerry Brown was back on the road Thursday, promoting education and prison policies in what he said will be an effort to "take a more active role" in working with local agencies.

"I'm going to devote myself, to the extent I have the time, to meet with local school districts and local law enforcement authorities to make sure that the state and the localities - and the local school districts - are operating in a very creative and intelligent partnership," Brown told reporters here.

He said he will focus on the ongoing implementation of prison realignment, in which the state shifted responsibility for certain offenders to counties, and on an education funding overhaul enacted last year.

The Democratic governor met with law enforcement officials in Monterey County, as he did in a two-day swing through the San Joaquin Valley last week. Brown, who has traveled relatively infrequently during the first three years of his term, is preparing for a likely re-election bid this year.

"I want to now take a more active role in working with localities," he said, "dealing with crime and dealing with educational success."

Brown's visit followed a State of the State speech that focused on fiscal prudence and was bereft of anything approaching a new policy pronouncement, and with only the barest mention of water and high-speed rail.

"You can only say too many things, and when you write your stories I didn't want you to say, 'Today Brown said, 1, 2, 3, 4, 5.' No, I only wanted you to say one thing: 'Brown said live within your means.'"

Monterey County Sheriff Scott Miller, who has been critical of realignment, said the program was "painful" and exacerbated jail crowding in his county, but he said it could be successful in the future.

Of the governor, Miller said, "He has an easygoing way about him, and I know he listens."

PHOTO: Jerry Brown speaks to reporters in Salinas on Jan. 23, 2014. The Sacramento Bee/David Siders

California's health insurance exchange failed to meet its first-class standards, frustrating tens of thousands of customers trying to enroll in coverage over the first three months of the program, officials said Thursday.

In a rare moment of public soul-searching, Covered California officials described the exchange's level of service as "completely unacceptable," and said they would apply the lessons to the next three months of enrollment commencing March 31.

"We know that thousands didn't have a good experience," Yolanda Richardson, deputy chief operations officer, told the exchange's board of directors on Thursday. "We're not satisfied with that. And we know we have a lot of work to do."

California continues to lead the nation with about 625,000 people enrolled in coverage. But long wait times and sluggish performance periodically plagued the exchange's customer service center and online enrollment portal.

"In many instances we did not meet our standard going back to our guiding principle of providing a first-class customer service experience," Richardson said, adding that the goal was to answer 80 percent of the calls in 30 seconds or fewer.

Wait times routinely exceeded one hour and in some cases were so long that customers were automatically disconnected, officials said.

The agency's inability to certify enough insurance agents and inaccurate or confusing notices mailed to consumers forced more of them to the phone lines and the internet. In some cases, they received no notices entirely, officials said.

The exchange is now working to add another 350 customer-service employees and a dedicated phone line for insurance agents. It also is ramping up its outreach to Latinos and other groups that experienced poor enrollment. Some 3,500 certified enrollment counselors are bilingual.

Executive Director Peter V. Lee said the exchange was boosting its marketing efforts in part thanks to a $155 million federal grant.

"Doing additional marketing is needed and is appropriate," Lee said, adding that in-person assistance will be a critical component in the coming months.

Earlier Thursday, Lee announced that former state Finance Director Ana Matosantos was hired as a senior adviser. Her compensation was not immediately known.

PHOTO: The executive director of Covered California, Peter V. Lee, speaks to members of the media during the launch of Covered California in Rancho Cordova on Oct. 1, 2013. The Sacramento Bee/Randall Benton.

Firearms manufacturer Smith & Wesson will no longer ship new semi-automatic pistols to California, preferring to turn away from the nation's most populous market rather than comply with a controversial new gun law.

The publicly-traded company posted the announcement on its website in reaction to the state implementing Assembly Bill 1471, which requires new or redesigned semi-automatic pistols have a "microstamping" feature that indelibly marks bullet casings with a unique code when a gun is fired.

The law doesn't apply to weapons purchased by law enforcement agencies.

"Smith & Wesson does not and will not include microstamping in its firearms," the company said in a press release dated today. "A number of studies have indicated that microstamping is unreliable, serves no safety purpose, is cost prohibitive and, most importantly, is not proven to aid in preventing or solving crimes."

Firearms companies and gun-rights advocates say the technology doesn't work. Earlier this month, the National Shooting Sports Foundation, a firearms manufacturers' trade group, sued the state for requiring microstamping for all new semi-automatic handguns.

Gov. Arnold Schwarzenegger signed AB 1471 six years ago, but it didn't go into effect until May 2013. The American Academy of Pediatrics, dozens of police chiefs supported it. Gun owners, manufacturers and 14 sheriffs opposed it.

At least one Smith & Wesson semi-automatic pistol has fallen off the state's list of firearms approved for sale, and more will follow, said James Debney, Smith & Wesson president and CEO.

He vowed to to "work with" the National Rifle Association and shooting sports foundation "to oppose this poorly conceived law which mandates the unproven and unreliable concept of microstamping and makes it impossible for Californians to have access to the best products with the latest innovations."

Editor's note, 3:04 p.m.: The post was amended to include AB 1417's exemption for law enforcement agencies.

PHOTO: California Highway Patrol Range Officer, J. Tomlinson demonstrates the CHP's new gun at the CHP Academy Range in West Sacramento on Tuesday May 16, 2006. The new gun is a Smith and Wesson .40 caliber TSW. The Sacramento Bee/ Randall Benton

California spent a below-average proportion of its state budget on education in 2012, vis-à-vis other states, but had one of the nation's highest relative levels of welfare spending, according to a new Census Bureau report.

The report lists California's expenditures from all funds, including federal aid, at $215.1 billion in 2012 and says that the $72.7 billion it spent on education represented 33.8 percent of the total, two percentage points lower than the national average.

At the same time, however, California spent $69.1 billion on welfare, or 32.1 percent, well over the national average of 29.7 percent and 8th highest among the states.

To look at the data another way, California spent more on education than the entire budgets of all but three other states - New York, Texas and Florida - and its welfare spending was higher than total spending of all but four other states, those three plus Pennsylvania.

PHOTO: Kindergarten teacher Katherine Hoffmore, left, works on a bead project with McKayla Parker, 6, right, where they learn to repeat patterns at Greer Elementary School in Sacramento on Jan. 17, 2013.

A busy Wednesday morning delivering his State of the State address and handing out Sutter Brown playing cards didn't keep Gov. Jerry Brown from heading to San Francisco to talk online education at the bimonthly meeting of the University of California Board of Regents. The regents' meeting concludes today with a session starting at 8:30 a.m.

Sitting in on part of Wednesday's meeting, Brown challenged regents to develop classes that require no "human intervention" and might expand the system's reach beyond its student body.

"If this university can probe into" black holes, he said, "can't somebody create a course — Spanish, calculus, whatever — totally online? That seems to me less complicated than that telescope you were talking about," referring to an earlier agenda item.

After receiving pushback from UC provost Aimée Dorr, who delivered the presentation, that students are "less happy and less engaged" without human interaction, Brown said those measurements were too soft and he wanted empirical results.

"Let's think of this as our little solar system," he said. "Can we somehow get beyond it and we're out there into the total human system of all 7 billion?"

VIDEO: Gov. Jerry Brown used to be an exciting speaker, but his addresses have gotten staid and cautious with age, Dan Walters says.

MAKING THE CUT: Friday is the last day for bills introduced in 2013 to get out of committee for a floor vote in their house of origin, so both the Senate and the Assembly appropriations committees have full dockets today. The Senate panel is scheduled to hear 42 bills, most of them items on its suspense file. The Assembly committee, meanwhile, has 59 pieces of legislation on the agenda.

EBBING ELECTORATE: Voter turnout in California is on the decline and the state has been pushing hard to increase the electorate. How have those efforts fared? The Public Policy Institute of California hosts a panel discussion on how to motivate more Californians to exercise their right to vote, featuring Secretary of State Debra Bowen and others. The event takes place at noon at the CSAC Conference Center on 11th Street.

DEGREE DEFICIENCY: A new report from California Competes, a council of civic and business leaders, says the state's higher education system is unprepared to address the demands of the economy and will produce 2.3 million fewer degrees than California needs over the next decade to remain competitive. During a webinar at 10:30 a.m., the group will outline its proposals for a long-term strategy to better guide higher education in California.

IN THE KNOW: Sick of sorting through a cluttered Twitter feed? Browse a curated list of Capitol tweets you need to read, brought to you by the Capitol Alert Insider Edition app. You can subscribe here.

PHOTO: This Wednesday, June 1, 2011 photo shows people as they walk through Sproul Plaza near the Sather Gate on the University of California, Berkeley campus in Berkeley, Calif.. The Associated Press/Eric Risberg

Gov. Jerry Brown's State of the State address this year illustrated how he has become too staid and cautious with age, Dan says.

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

See other Dan Walters Daily clips here.

PHOTO: Gov. Jerry Brown shows a card with the state budget as he delivers the 2014 State of the State address to a joint session of the Legislature on Jan. 22, 2014. The Sacramento Bee/Hector Amezcua

A group of California lawmakers have banded together to form a new legislative caucus focused on issues they believe matter to the Jewish community.

The Legislative Jewish Caucus will also form a political action committee to raise money to support Israel-friendly candidates, said Sen. Marty Block, the San Diego Democrat who chairs the new group.

"This isn't a religious based organization. We see this as an ethnic organization," he said.

"My guess is very few of the members would define themselves as being terribly religious, but we all consider ourselves to be part of the Jewish people."

The Jewish caucus includes five Senators and four Assembly members who identify themselves as Jewish, as well as a handful of other lawmakers who are not Jewish but want to participate, Block said. All participants so far have been Democrats, but Block said the group would welcome Republicans.

The Legislature has several caucuses organized around various identities, including race, sexuality and geography. The Jewish caucus will work to fight discrimination against all minorities, Block said, partly based on religious beliefs that favor equality, "but also out of a personal concern that if folks are treated unequally, Jews will be among those who are treated unequally."

Concerned that officials are leaving millions of fire-prevention dollars unspent, Senate President Pro Tem Darrell Steinberg said Wednesday that he will put off a Senate vote to confirm two appointees of Gov. Jerry Brown to the California Board of Forestry and Fire Protection.

The Senate Rules Committee recommended the confirmations of forestry board members of Stuart L. Farber, Jr. of Redding and and Mary E. Rickert of Fall Rivers Mill. Brown appointed both in March 2013.

Steinberg, though, said the full Senate will not consider the appointments until the Brown administration provides more information about how it proposes to spend the money generated by a $150 fee on properties in 31 million acres of state responsibility area. The fee will raise an estimated $76 million in 2013-14, according to Brown's budget plan this month.

"I just don't want money sitting there when there's a lot of prevention to be had," said Steinberg, the chairman of the rules panel, pointing to the drought and worsening wildfire danger.

Governor's appointees must be confirmed within one year. Farber's 365th day is March 19 and Rickert's is March 20.

The fire-prevention fee has been controversial since it was included in the 2011-12 budget. Opponents have gone to court to overturn the charge, which they call an illegal tax.

"Are we going to be able to quantify what we get out of it?" state Sen. Steve Knight, R-Palmdale, who voted against the legislation creating the fee in 2011, asked Wednesday. "How are we going to find out if this is helping or if this is hurting?"

PHOTO: California Department of Forestry and Fire Protection crews work to contain a wildfire that burned several acres of dense brush and threatened homes in Pollock Pines in Thursday May 15, 2008. The Sacramento Bee/Randall Benton

By Richard Chang

California Chief Justice Tani Cantil-Sakauye today said Gov. Jerry Brown's proposed budget shortchanges the judicial branch.

During a visit to The Sacramento Bee's Editorial Board, the top judge noted that $266.5 million is required to maintain current court service levels. Brown's budget proposal, however, provides only an additional $100 million in General Fund support for the court system.

Without more money, Cantil-Sakauye said, courts across the state will be forced to make drastic cutbacks, including layoffs, court closures and furloughs.

"All these programs are all good and well...but they're unenforceable unless there's a justice system," Cantil-Sakauye said.

She pointed out that cuts during the recession have hampered the courts' ability to efficiently handle cases. "Prior to the state's fiscal free fall, we were functioning well in my view," she said.

PHOTO: California Supreme Court Chief Justice Tani Cantil-Sakauye answers questions from The Bee's Editorial Board at the offices of The Sacramento Bee in Sacramento on Wednesday, January 22, 2014. The Sacramento Bee/Randall Benton

By Ben Mullin

Gov. Jerry Brown had an unlikely ace up his sleeve while attempting to woo reporters during his State of the State address today: Sutter Brown.

The 10-year-old Pembroke Welsh corgi appeared on several playing cards given out to members of the media before the governor began his annual speech to the Legislature, drawing mixed reactions.

The playing cards, which appeared in a variety of suits, each featured dog-related aphorisms regarding prudent spending, accompanied by a picture of Sutter Brown's face. The reverse side showed a year-to-year bar graph of California's budget with the heading "huge deficits follow balanced budgets."

"A prudent corgi knows to nibble at his kibble," read one card, which featured a picture of the dog wearing a blue and gold crown. "Save some biscuits for a rainy day," read another.

Senator Holly Mitchell, D-Los Angeles, seized the opportunity to promote upcoming legislation, tweeting,

@SutterBrown I'm barking and growling because I hate poverty! #SB899 #RepealMFG

— Holly J Mitchell (@HollyJMitchell) January 22, 2014

After reporters asked via Twitter how the governor's office intended to pay for the cards, the governor's press office responded in a tweet, saying that Brown and his wife will foot the bill:

"No state funds were spent on printing playing cards #GoFish," the tweet read.

Emerging from a closed-door meeting of Assembly Democrats, Speaker John A. Pérez, D-Los Angeles, said his caucus unanimously supports making Assemblywoman Toni Atkins, D-San Diego, the next Speaker.

The announcement ends months of speculation about who would take over the leadership post once Pérez leaves office at the end of 2014. Pérez emphasized the fact that not a single member of the 55-member Democratic caucus dissented from the selection of Atkins.

"It was unanimous going into the room, it was unanimous coming out of the room," Pérez said. "There was absolute unanimity about peoples' support and excitement about having Ms. Atkins as the next speaker.

A formal vote will come some time in the spring, Pérez said. The timeline for Atkins formally taking over has not been fixed.

"It's the work of transition that will dictate the timeline," Pérez said. "It is not an insignificant institution."

The selection of Atkins marks a few milestones: it is the first time an openly gay woman will lead either chamber of the California Legislature. Atkins will also be the first lawmaker from San Diego to helm the Assembly.

With Sen. Kevin de León, D-Los Angeles, set to take over as Senate president pro tem later this year, California is also on the verge of a situation with scant precedent: having both legislative leaders hail from Southern California.

While lawmakers have historically chosen a northerner to lead one house and a southern lawmaker the other, Pérez dismissed the appearance of a tradition as "an artificial construct." Atkins said the district she represents will have little bearing on how she manages the caucus.

"We are Californians first," Atkins said. "I've had good conversations with my colleagues, and we are consistently unified that we are all doing the work of California," she added.

A Virginia native whose vowels still bear the slight twang of her upbringing, Atkins served on the San Diego City Council and as interim mayor before winning election to the Legislature in 2010.

Atkins said her priorities this year, including during budget negotiations, will not differ from the framework already set forth by Assembly Democrats.

"I think our caucus agenda has been set," she said.

PHOTO: Speaker John A. Pérez, and Assemblywoman Toni Atkins discuss Atkins becoming the next speaker in the State Capitol building in Sacramento, Calif. on January 22, 2014. The Sacramento Bee/Jeremy B. White.

Two Republicans bidding to unseat Gov. Jerry Brown this year criticized the Democratic governor Wednesday for failing to mention California's nation-high poverty rate in his State of the State address.

"Governor Brown may claim a California comeback, but the truth is that he has forgotten the millions of California families who are struggling," Neel Kashkari, who announced his candidacy Tuesday, said in a prepared statement.

The former U.S. Treasury Department official said it is "outrageous" that Brown did not address poverty.

The only other Republican actively campaigning against Brown, Assemblyman Tim Donnelly, R-Twin Peaks, was similarly critical.

He said in a prepared statement that the Democratic governor "has repeatedly failed to address how he intends to get the state back to work and return prosperity to California."

Brown, who has raised millions of dollars for a likely re-election bid this year, made passing reference to "struggling families" near the end of his annual address, but he largely avoided the issue.

Republicans have criticized Brown on the economy since the U.S. Census Bureau reported last fall that 23.8 percent of Californians live in poverty under a calculation that includes the cost of liming.

Brown told National Public Radio's "All Things Considered" last year that the poverty rate is "the flip side of California's incredible attractiveness and prosperity," as many immigrants to the state are unskilled.

PHOTO: Neel Kashkari speaks at an interview with The Associated Press in Sacramento on Dec. 4, 2013. AP Photo/ Rich Pedroncelli

Gov. Jerry Brown spoke for about 17 minutes during Wednesday's State of the State speech — an address that would have been even shorter but for several diversions Brown made from his prepared text.

Here is Brown's address, as delivered, as well as a word cloud showing which words the Democratic governor used the most.

"Thank you. It seems like people are kind of excited. And so am I. I did come here to speak to all of you in 1975, a long time ago. Some of you may have forgotten or probably weren't born then. I came here in 1959 for the first time in my (inaudible) garb as a Jesuit seminarian, my Roman collar, my little black suit, I sat right down there and looked up at my father give his first state of the state back in 1959. Lieutenant governor, I appreciate change but I also value continuity. I used to say take the ins and throw them out and take the outs and throw them in. I don't say that anymore. My message is, there is no substitute for experience.

"Anyway, here I am. I am here today to report on the state of our state, choosing to ignore those who say that Article 5 of our Constitution, which requires the governor to report to the Legislature, is outdated; that you can't report on the condition of our state from Sacramento because California is too spread out and too diverse. It occurred to me that these critics - who have long recited our state's decline - perhaps have nothing to say in the face of California's comeback - except, "please, don't report it." Well, I'm going to report it, and what a comeback it is: A million new jobs since 2010, a budgetary surplus in the billions...in the billions -- but don't spend it, that's the point -- and a minimum wage rising to $10 an hour.

Here are some reactions to Gov. Jerry Brown's State of the State address.

Republican gubernatorial candidate Neel Kashkari

Governor Brown may claim a California comeback, but the truth is that he has forgotten the millions of California families who are struggling. 24 percent of our fellow Californians live in poverty. Yet how many times did the Governor mention poverty in his 17-minute address? Not once. That is outrageous.

The state of the state is devastating for millions of Californians. Our schools are ranked 46th in the nation. Nearly 18 percent of Californians are out of work or stuck in part-time jobs. People don't want welfare. They want good jobs. Yet instead of doing the hard work of fixing these problems, Governor Brown is focused on touting record-high spending and building a crazy train that the state doesn't want and can't afford.

Let there be no doubt: The status quo is unacceptable and we can't let Governor Brown get away with it.

Senate President Pro Tem Darrell Steinberg, D-Sacramento

Assemblywoman Shirley Weber, D-San Diego

The Governor did a great job of reporting what we've done to improve the state's fiscal situation and telling us about the work that lies ahead. But I'm hoping that now we will create a greater vision for California in terms of and dealing with issues of poverty, educational achievement and creating opportunity for everyone.

We all agree that we've got to create more jobs, but we also have to create the capacity in individuals to be ready for those jobs. We can talk about the greatness of California - and it is a great state, no question, with Silicon Valley, our high tech industry and research institutions. But are average Californians ready to work in these industries? Probably not. We will need to focus on preparing our kids for these jobs now

I agree that it's important to give school districts flexibility, but we also have to focus on accountability. What happens when a school doesn't succeed? What happens when a school board doesn't properly use the funding? We need to make sure that funds specifically set aside for improving the academic performance of disadvantaged students are actually spent on closing the Achievement Gap.

Gov. Jerry Brown said today that California is continuing its "comeback," with a budget surplus and an improving economy, but he urged the Legislature to restrain spending.

"This year, Californians have a lot to be proud of," Brown told a joint session of the Legislature in his State of the State address. "For a decade, budget instability was the order of the day. ... But three years later, here we are, with state spending and revenues solidly balanced, and more to come."

However, Brown said the state budget is based on fluctuating revenue, and long-term liabilities are high. As he did in his State of the State speech a year ago, Brown offered the cautionary, biblical account of Joseph and the Pharaoh's dream of seven cows.

"Boom and bust is our lot and we must follow the ancient advice, recounted in the Book of Genesis, that Joseph gave to the Pharaoh," Brown said. "Put away your surplus during the years of great plenty so you will be ready for the lean years which are sure to follow."

The 17-minute speech was the final State of the State address of Brown's third term. The 75-year-old Democrat is widely expected to seek re-election, and the speech served to preview his campaign.

Brown has made construction of a $68 billion high-speed rail system a priority of his administration, despite fierce opposition from Republicans. Brown is also seeking to push forward his $25 billion plan to build two tunnels to divert water around the Delta to the south.

A drought emergency Brown announced last week has only heightened controversy around that plan.

Brown said that "among all our uncertainties, weather is one of the most basic. We can't control it. We can only live with it, and now we have to live with a very serious drought of uncertain duration."

He said, "We need everyone in every part of the state to conserve water," and he called for "further progress" on his tunnels plan.

Join Bee columnist Dan Walters for Q&A and a discussion of the governor's State of the State speech.

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Another week, another big speech from Gov. Jerry Brown: With the announcement of his budget proposal and the declaration of a drought emergency out of the way, Brown now turns his attention to the annual State of the State address, in which the governor has an opportunity to make the case for his 2014 policy agenda.

The speech, which takes place in the Assembly Chambers of the Capitol at 9 a.m., could end up touching upon many of the same topics as last year. The controversial high-speed rail and Delta water tunnel projects, both of which Brown voiced support for in his 2013 address and repeatedly since, remain in development limbo. The "philosophy of loyalty" developed by Josiah Royce, a Grass Valley-born thinker in the 1800s, may also make an appearance.

At 8:30 a.m., Capitol Alert will launch its live blog, including Twitter feeds, reaction and streaming video of the speech. Columnist Dan Walters will host a live chat starting at 11:45 a.m. Come to sacbee.com/live for all the coverage.

VIDEO: With little chance to win the California governorship, Republican candidates are battling for the future of the state party, Dan Walters says.

REGENTS ROUNDUP: As part of the bimonthly University of California Board of Regents meeting, which kicks off today in San Francisco, the leaders of the state's three higher education branches will gather to discuss the future of California's Master Plan for Higher Education. The document, adopted in 1960, lays out the role of each system in serving the state's students. UC President Janet Napolitano, California State University Chancellor Timothy P. White and California Community Colleges Chancellor Brice W. Harris plan to share with the UC Regents how they are collaborating to strengthen the Master Plan. The discussion is the fourth and final item on the agenda for the meeting's 1 p.m. session, which will be webcast live.

MAYOR MAYHEM: Sacramento will be filled with more politicians than usual this week as local representatives from across the state descend upon the Sheraton Grand on J Street for the League of California Cities' New Mayors and Council Members Academy. The three-day conference, beginning today at 8 a.m. and continuing through Friday, trains newly-elected and veteran officials on the legal and practical framework in which a city operates.

INSIDER OF THE WEEK: Who will be the latest politician skewered on the pen of cartoonist Jack Ohman? Find a new portrait every Sunday on the Capitol Alert Insider Edition app. You can sign up here.

PHOTO: Gov. Jerry Brown, center, delivers his State of the State speech to California legislators in the Assembly chambers at the Capitol on Jan. 24, 2013. The Sacramento Bee/Hector Amezcua

With Gov. Jerry Brown practically unbeatable, Neel Kashkari and Assemblyman Tim Donnelly, R-Twin Peaks, are really running to determine the future of California's Republican party, Dan says.

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

See other Dan Walters Daily clips here.

PHOTO: Assemblyman Tim Donnelly, R-Twin Peaks, announces he's running for California Governor, in Baldwin Park, Calif., on Nov. 5, 2013. The Associated Press/Nick Ut

It's not often you see a lawmaker lobbying her colleagues to kill a bill because she thinks it insults her husband. But that's what happened Tuesday as Sen. Carol Liu made the rounds on the Senate floor asking fellow senators to withhold their votes when Senate Bill 434 came up.

Liu, a Democrat from La Cañada Flintridge, is married to Michael Peevey, chair of the powerful Public Utilities Commission. The bill she was trying to kill would bar future PUC chairmen from sitting on the boards of nonprofit organizations created by the commission that regulates utility companies in California.

"I don't think the bill has anything to do with public policy," Liu said after the vote. "I think it's a jab at my husband, period."

Peevey sits on the boards of two nonprofits, which the PUC created as part of PG&E's 2004 bankruptcy deal and the mergers in 2005 of four major telecom companies. Chairing the commission that regulates the industry while sitting on the boards of the nonprofits the commission created is a conflict of interest, says Sen. Jerry Hill, D-San Mateo.

"You're taking public money that has transparency in public, it has full oversight, it has full accountability, and turning it over to a nonprofit where their actions, and future fundraising, is all behind closed doors," said Hill, who carried the bill Liu tried to kill Tuesday.

"To me, it's a clear conflict of interest that should not be allowed to continue into the future."

The contest to become California's next Assembly speaker could be over, with multiple lawmakers and staffers telling The Bee that Assemblywoman Toni Atkins, D-San Diego, has secured enough votes to lead Assembly Democrats.

The race turned decisively in Atkins's favor this weekend, sources said, when key lawmakers decided to lend their support to Atkins. Currently the majority floor leader, Atkins would become the first openly gay woman to serve as speaker.

A San Francisco-based organization that just last week backed Assemblyman Rich Gordon, D-Menlo Park, sent out a release praising Atkins.

"The Bay Area Council congratulates Assemblymember Toni Atkins of San Diego, whom we understand has secured the votes to become the next Speaker of the California Assembly," Jim Wunderman, President and CEO of the Bay Area Council, said in the statement.

The Bay Area Council's endorsement of Atkins marked a swift reversal from the group's decision last week to promote Gordon in an effort to ensure the next speaker hailed from Northern California. That came right after Senate President Pro Tem Darrell Steinberg, D-Sacramento, anointed Sen. Kevin de León, D-Los Angeles, as his successor.

There had been speculation that de León's elevation would come at the expense of Assembly speaker candidates from Southern California. But former and current lawmakers discounted the notion that the Legislature must have one leader from Northern California and one from Southern California.

Both the Senate and the Assembly need to elect new leaders this year, with Steinberg and his Assembly counterpart, Speaker John A. Pérez of Los Angeles, forced out by term limits.

PHOTO: Assemblywoman Toni Atkins, D-San Diego speaks with Assembly Speaker John A. Perez, D-Los Angeles as the Assembly members wait for bills from the Senate side at the State Capitol in Sacramento on Friday, June 14, 2013.

Hourly workers in California would be able to accrue paid sick days under a bill introduced by Assemblywoman Lorena Gonzalez, D-San Diego.

Gonzalez cast Assembly Bill 1522 both as a financial security net for workers and as a public health measure. She noted that many workers who do not receive paid sick days work in the food industry, where sick workers risk infecting consumers, or with more vulnerable populations such as young children and the elderly.

"If you're an hourly worker and you're sick you have to choose if you're going to pay the bills or take a day off," Gonzalez said, noting that single mothers face a challenge caring for sick children if they cannot take a day off.

The measure would require California employers to give paid sick leave to employees who have worked at the job for at least 90 days. Employers could cap each worker's total sick days at three per year.

Gonzalez said guaranteeing sick days would also diminish health care costs, both by preventing diseases from spreading for lack of treatment and by not requiring workers to resort to emergency care, Gonzalez argued.

"We know that it's about four times more expensive when a mother takes her child to the emergency room after hours rather than being able to take time to take them to a doctor to prevent further sickness or address sickness," Gonzales said.

While the California Chamber of Commerce has not yet taken a position on the bill, they and other business interests have opposed similar efforts in the past. A series of paid sick day bills by former Assemblywoman Fiona Ma could not attract enough votes to overcome pro-business arguments.

PHOTO: Assemblywoman Lorena Gonzalez, D-San Diego, receives applause from lawmakers as she walks down the center isle of the Assembly to take the oath of office at the Capitol in Sacramento, Calif., Tuesday, May 28, 2013. The Associated Press/Rich Pedroncelli.

Neel Kashkari, the former U.S. Treasury Department official who has been preparing to run for governor for a year, formally entered the contest Tuesday, pledging to improve public education and the jobs climate in California.

"That's my platform: Jobs and education," Kashkari said at a business luncheon at Sacramento State. "Jobs and education. That's it."

In declaring his candidacy, Kashkari, 40, joins Assemblyman Tim Donnelly, R-Twin Peaks, as the only Republicans actively campaigning to unseat Gov. Jerry Brown. Former Lt. Gov. Abel Maldonado abandoned his campaign last week.

"Millions of Californians are struggling," Kashkari said. "The status quo is unacceptable."

Kashkari's entrance into the race was widely expected. He left his job at Newport Beach-based Pacific Investment Management Co. a year ago, hired political advisers and spent recent months meeting with potential donors and giving newspaper interviews.

His viability as a candidate remains an open question, as he will only now begin to raise money and test his moderate social views with GOP donors and the party's base. Kashkari has never run for elected office and has said he cannot self-finance the effort.

Unseating Brown in this heavily Democratic state would be a tough task for a Republican, analysts believe, and raising money against him has proven to be exceedingly difficult. Donnelly has reported raising just more than $200,000, while Brown has raised more than $17 million.

Kashkari, a former Goldman Sachs executive, ran the $700 billion bank bailout known as the Troubled Asset Relief Program during former President George W. Bush's administration. He has said he will make poverty and education the focus of his campaign.

Announcing his candidacy at a luncheon at Sacramento State, Kashkari said the state's public education system is failing its students and leaving millions of residents in poverty.

"We have to grow the economy and create jobs," he said, "and give kids a good education at the same time."

Kashkari joins a long list of Republicans complaining about California's high poverty rate. Last fall, the U.S. Census Bureau reported a poverty rate in California of 23.8 percent, using an alternative calculation that includes cost of living, and the large number of Californians who are unemployed or marginally employed and looking for work.

Kashkari also criticized California's $68 billion high-speed rail project, garnering applause when he called the controversial project a "crazy train."

Democrats have painted Kashkari as a wealthy product of the private sector who had little interest in California politics before deciding to run for governor.

Kashkari, of Orange County, spent much of last year traveling the state, promoting his appearances at food banks and community centers on Twitter.

Kashkari's appearance Tuesday was his first speech since leaving his job at Pacific Investment Management Co. He had fueled speculation he would make his announcement there when, in an interview last week, he billed the appearance as a "major speech."

Kashkari supports same-sex marriage and abortion rights and voted for Barack Obama in 2008. He has opposed tax increases and supported efforts to limit the political influence of labor unions.

Brown, a third-term Democrat, has not yet said if he will seek re-election, but in addition to his fundraising he has hinted he will, and he is widely expected to run.

PHOTO: Neel Kashkari speaks at an interview with The Associated Press in Sacramento on Dec. 4, 2013. AP Photo/ Rich Pedroncelli

John Zierold, who ran legislative strategy in Sacramento for the Sierra Club during the 1970s and 1980s, as environmentalism became a powerful social and political movement, has died.

Former colleagues in Sacramento learned over the weekend that Zierold, who had retired to Kentucky, had died on Dec. 26 in Louisville at age 88. He had been preceded in death by his wife, Mary.

Zierold, who had worked in Europe as a U.S. intelligence operative during the immediate post-World War II era, began representing the Sierra Club at the Capitol in 1969, during the infancy of the environmental movement.

Zierold played pivotal roles in legislative battles for almost two decades over such issues as coastal protection, the California Environmental Quality Act, creation of the state Energy Commission, regulation of logging, and legislation designating "wild and scenic rivers" on which dams would be prohibited.

He also clashed with Jerry Brown during his first stint as governor over Brown's advocacy of a liquefied natural has terminal near Santa Barbara and a "peripheral canal" to carry Sacramento River water around the Sacramento-San Joaquin Delta — battles that Brown lost.

"He saved the Coastal Commission from defeat," Norbert Dall, a Sacramento environmental consultant who worked for Zierold during the period, said Tuesday, recounting Zierold's skills at working the legislative system. Dall also said that Zierold played a major role in rounding up key votes to elect Leo McCarthy as speaker of the state Assembly in 1974.

Zierold's survivors include a stepson, Marc Allaman, in Folsom.

PHOTO: Protesters hold signs during a July 19, 2012 rally sponsored by the Sierra Club to make their point regarding limits on levels of deadly soot pollution. The Sacramento Bee/Randy Pench

Is Neel Kashkari finally ready to declare his candidacy for governor of California?

The former U.S. Treasury Department official under President George W. Bush has been circling a campaign for months, and recently he's been making the rounds in Sacramento. Last Tuesday, he met with the Legislature's Republican caucuses.

He'll be at Sacramento State's Union Ballroom at 12:10 p.m. today to deliver the keynote address during the release of the 2014 Sacramento Business Review. Last week, he told The Bee that it would be a "major speech," adding, "You should come for that."

Sounds like something is brewing.

VIDEO: How Gov. Jerry Brown handles this drought could define his governship, Dan Walters says.

BILLS, BILLS, BILLS: Friday is the deadline for bills introduced in 2013 to make it through committee in their house of origin. With that cutoff looming, the Senate Appropriations Committee, the final stop before the floor, has a packed agenda for its meeting today: the panel is scheduled to hear 34 bills, including SB 637 from Sen. Leland Yee, D-San Francisco, which would require election officials in California to make early voting opportunities available, and SB 583 from Sen. Tom Berryhill, R-Twain Harte, which would create a new 12-month fishing license. The committee hearing will take place at 11 a.m. in Room 4203 of the Capitol.

LINKED IN: As he enters his final year in the Legislature, a major policy goal of state Senate President Pro Tem Darrell Steinberg has been the implementation of "linked learning," a program that connects high school education to career training. He plans to discuss the next step for the $250 million competitive grant fund during a 10 a.m. conference call with state schools superintendent Tom Torlakson, California Community Colleges Chancellor Brice Harris, and Tim Rainey, executive director of the California Workforce Investment Board.

CANNA-BIZ: As marijuana once again becomes a hot topic, the California Cannabis Industry Association hosts a welcome back reception for legislators tonight at 5 p.m. at Chops on 11th Street. The event, which includes manufacturers and distributors of cannabis products, aims to educate attendees on the best practices of the medical marijuana industry and push for its increasing professionalization. The association says it would like to see a bill pass this year that regulates medical marijuana under the Department of Alcoholic Beverage Control.

PHOTO: Neel Kashkari, who is exploring a possible run for governor in 2014, on Dec. 4, 2013. The Associated Press/Rich Pedroncelli

Now that Gov. Jerry Brown has declared a drought emergency in California, he will be held responsible for how it turns out in the long run, Dan says.

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

See other Dan Walters Daily clips here.

PHOTO: A pair of fishermen stand near the shallow water of the American River below Watt Ave on January 11, 2014. The Sacramento Bee/Randall Benton

Complaining that promised Sacramento dollars for her candidacy never showed up, Southern California real-estate agent Lonni Granlund has dropped out of the special-election race to succeed former state Sen. Bill Emmerson.

Granlund, a Yucaipa Republican, said in a statement that she had been recruited to run for the 23rd Senate District because "the prevailing sentiment was that the field of candidates was unimpressive and unable to tackle the state's anti-business philosophy."

"As a businesswoman I was viewed as someone with the skills to make a difference, but that's not enough in Sacramento," Granlund wrote on her campaign web site. "My friends, family and supporters generously stepped up to help reach the goals set for a viable campaign. Unfortunately the funding from Sacramento simply did not materialize."

Granlund, the ex-wife of former lawmaker Brett Granlund, continued, "As much as I would love to serve the people of the 23rd State Senate District, I cannot in good conscious continue in an underfunded campaign that has little or no possibility of success."

Granlund's dropping out comes two weeks before the filing deadline for the March 25 special election. A runoff, if no candidate gets a majority of the votes, is June 3.

Granlund's departure leaves Assemblyman Mike Morrell, R-Rancho Cucamonga, as the presumptive favorite in the Republican-leaning 23rd, which wraps from Rancho Cucamonga to Hemet. Calimesa Councilman Jeffrey Hewitt and San Jacinto Councilwoman Crystal Ruiz also have filed statements of intent to run for the seat.

23rd Senate District

PHOTO: Lonni Granlund, courtesy of Granlund campaign website.

SAN FRANCISCO — The plainest reason for a governor to call a drought emergency is to focus public attention on conservation, and Gov. Jerry Brown spent most of a Friday morning news conference focused exactly on that.

But the Democratic governor is aware that an ongoing drought could have significant implications for water policies central to his administration, including his $25 billion plan to build two tunnels to divert water around the Delta to the south.

Brown sought to use the drought to his advantage, arguing that the project will improve long-term water management.

"I think it makes the case that more water can be saved if you have a Delta facility," he said.

Brown also suggested the state will press the federal government to accelerate environmental reviews of the project.

Restore the Delta, a group opposed of Brown's plan to build the tunnels, issued a statement immediately after the news conference.

With the state now in its third straight dry year, the coalition said "there is no surplus water to export."

PHOTO: Gov. Jerry Brown declares a drought emergency in San Francisco on Friday, Jan. 17, 2014. The Sacramento Bee/David Siders

California lawmakers got to party like it was 1995 on Thursday night.

An annual back-to-session bash, courtesy of various special interest groups like the California Tribal Business Alliance, the California Bankers Association and the Distilled Spirits Council, allowed lawmakers and lobbyists to mingle among all the trappings of an opulent political event: a "cigar cabana," an ice sculpture, a taco bar and a martini station.

And, of course, some musical entertainment. In this case, the event's organizers enlisted hip hop artist Coolio to entertain the audience.

The event seemed to appeal mostly to the 20-to-30-something staffers who crowded close to the stage and shouted the lyrics to "Gangsta's Paradise" and "1 2 3 4" (lyrics: "1, 2, 3, 4, get your woman on the floor).

But a few legislators did join Coolio on the stage: Assembly members Rob Bonta, Steve Bradford, Sharon Quirk-Silva and Isadore Hall all availed themselves of the opportunity to get down.

Shortly after, an enthused Senate President Pro Tem Darrell Steinberg, D-Sacramento, took the stage to rue the fact that this would be his last back-to-session bash - he is forced out of office by term limits at the end of 2014 - and to hype his colleague, Senator Kevin de León, D-Los Angeles, as "the next pro tem of the California Senate," a distinction de León appeared to secure earlier this week.

PHOTO: Coolio performs at an event in Sacramento, Calif. on January 16, 2014. By Laurel Rosenhall/The Sacramento Bee.

SAN FRANCISCO - Gov. Jerry Brown declared a drought emergency Friday and urged residents to reduce water consumption by 20 percent statewide.

"Today I'm declaring a drought emergency in the state of California," Brown told reporters here, "because we're facing perhaps the worst drought that California has ever seen since records began being kept about 100 years ago."

The declaration come as the state suffers through dry conditions for a third straight year. It follows weeks of consideration by the Democratic governor amid pressure from lawmakers and water officials to act.

Brown had suggested for days that he was close to declaring the emergency, a formal act considered useful for raising public awareness and focusing the attention of federal officials who can accelerate some relief efforts.

In declaring an emergency, Brown directed state agencies to hire more seasonal firefighters, use less water and prepare a water conservation public awareness campaign.

Brown's appeal for conservation is voluntary, but he suggested the state could impose mandatory reduction measures if the drought lasts.

"As we go down the road - you know, January, February, March - we will keep our eye on the ball and intensify, even to the point of mandatory conservation," he said. "But we're not going to do that quite yet."

California is entering one of the driest winters on record after two dry years have already parched the state, depleted reservoirs and left streams and rivers running low. American River flows are at their lowest level in two decades, while Folsom Lake has receded so dramatically a Gold Rush-era mining town, long submerged, has been exposed.

The U.S. Department of Agriculture on Wednesday designated parts of 11 states, including California, as primary natural disaster areas due to drought. The designation, which includes Sacramento, Fresno and San Luis Obispo counties, makes certain farmers eligible for low-interest emergency loans to cover losses.

Meanwhile, water districts and local governments throughout the state have enacted conservation measures, including a water rationing order by city officials this week in Sacramento.

The last drought emergency in California was declared by then-Gov. Arnold Schwarzenegger in 2009 and lifted by Brown in 2011.

Last year, with the state becoming drier once again, Brown issued an executive order directing the State Water Resources Control Board and Department of Water Resources to expedite their processing of voluntary water transfers.

Editor's note: This post was updated at 10:44 a.m. to include additional remarks by Brown.

PHOTO: Gov. Jerry Brown addresses the media at Fresno City Hall on Monday, Jan. 13, 2014. The Fresno Bee/Eric Paul Zamora

The Legislature just came back in session last week, but lawmakers already have their first break to look forward to: Monday is Martin Luther King, Jr. Day. As a result, both the Senate and the Assembly will meet for brief, atypical Friday floor sessions at 9 a.m. before everyone heads home for the long weekend.

Not much is likely to happen, but it will allow legislators to collect their per diem allowances. Under the California constitution, lawmakers are granted tax-free living expenses on top of their salaries--as long as they are not out of session for more than three consecutive days.

According to the Assembly Rules Committee, the per diem rate was raised last month to $163 from $141.86 per day. That is still below its $173 peak from October 2008 to September 2009.

VIDEO: The path is clear for a landslide re-election for Gov. Jerry Brown, Dan Walters says.

APP-Y NEW YEAR: The Sacramento Bee is pleased to announce a major update and new design for the Capitol Alert Insider Edition app.

The new 2014 version:

• Works on both your iPhone and iPad with a single subscription.
• Offers faster access to our bills-to-watch guide and legislative directory, along with new district maps.
• Includes a new section on legislative committees.
• Lets Insider Edition app subscribers comment and share with one another.
• Includes all the previous Insider features, including early access to Field Polls and Bee editorials on state topics and a curated Capitol Twitter feed. Easily email chiefs of staff, schedulers and legislative directors from within the app.

To subscribe, go to www.sacbee.com/insider. It's free this week, $19.99 a month after that.

IT'S OFFICIAL: Gov. Jerry Brown's press office sent out a mysterious e-mail yesterday saying that he would be making a "major announcement" in San Francisco at 10 a.m. As reported last night, Brown is expected to declare a drought emergency in California, which farmers and Central Valley lawmakers have been calling for for several weeks.

STOPPED IN ITS TRACKS: Should California's proposed high-speed rail finally get off the ground this year, construction would begin along a 130-mile stretch in the Central Valley. That region has voiced some of the loudest criticism of the plan, however, and calls to kill the project have only intensified. State Sen. Andy Vidak, R-Hanford, and Assemblyman Jim Patterson, R-Fresno, will be in Fresno today at 1:30 p.m. to announce new legislation aimed at stopping the project.

MLK EVENTS: Several local groups are planning rallies at the Capitol over the long weekend to commemorate King. On Saturday, Occupy Sacramento will host a march and noontime rally at the west steps "continuing the legacy of Dr. King" by calling for a living wage, immigrant rights and more. Monday's 33rd annual "March for the Dream" makes a stop at the north and west steps around 10:45 a.m. before continuing on to the Convention Center for a diversity expo.

CELEBRATIONS: Happy birthday to Assemblywoman Kristin Olsen, R-Modesto, who turns 40 on Sunday.

PHOTO: Twenty-eight new assemblymembers undergo orientation inside the Assembly chambers on Nov. 12, 2008. The Sacramento Bee/Brian Baer

With a viable challenger yet to emerge, could Gov. Jerry Brown approach the record re-election rate of former Gov. Earl Warren?, Dan wonders.

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

See other Dan Walters Daily clips here.

PHOTO: Gov. Jerry Brown talks to members of the press on April 23, 2013. The Sacramento Bee/Hector Amezcua

Gov. Jerry Brown will declare a drought emergency Friday, sources said, after weeks of intensifying pressure on him to take action.

The declaration, which Brown is scheduled to announce at 10 a.m. in San Francisco, comes during one of the driest winters on record in California, following two dry years that already have left many reservoirs depleted.

U.S. Sen. Dianne Feinstein, Rep. Jim Costa, D-Fresno and several state lawmakers began urging Brown last month to declare a drought emergency. Brown appointed a committee to review conditions on the ground.

A formal declaration is considered significant as a public relations tool, increasing awareness of residents and, perhaps, federal officials who could accelerate some relief efforts.

Brown's office said Thursday that Brown would "make a major announcement" in an appearance Friday in San Francisco. The administration declined to disclose the nature of the announcement.

But a declaration has been expected, with Brown indicating repeatedly in recent days that he was close to declaring the emergency. Facing calls for a drought declaration while on a two-day swing through inland California this week, Brown said "nobody should discount the seriousness of what we're facing."

Still, Brown has suggested the significance of a formal declaration may be overstated.

"I'm trying to understand what physically we can do in the face of this drought, and then legally what steps can I take," the Democratic governor told reporters in Bakersfield on Tuesday.

Brown said a drought declaration could be helpful, "but at the end of the day, if it doesn't rain, California's in for real trouble. And the governor, through a declaration, can't make it rain."

Brown managed a drought in the late 1970s, when he was governor before. At the time he called for a 25 percent reduction in personal water use statewide and lobbied Washington for federal aid.

PHOTO: Gov. Jerry Brown addresses the media at Fresno City Hall on Tuesday, Jan. 14. The Fresno Bee/Eric Paul Zamora

Liberal women's rights activist Sandra Fluke urged a roomful of 600 policymakers and advocates in Sacramento today to work on issues beyond abortion access, touting efforts to provide fertility treatment to injured veterans, health care to transgender people and additional payments to women who get pregnant while receiving welfare.

"If you believe in a woman's right to decide it's not the time to have a child, then you also believe in her right to decide that it is time to have a child," Fluke, a lawyer, said during a speech at the California Women's Policy Summit.

The comment was a reference to Senate Bill 899 by Sen. Holly Mitchell, D-Los Angeles, which seeks to overturn a law that forbids women who get pregnant while on welfare from receiving additional payments if she has the baby.

"We should never lose sight of our core fight — the ability to have access to the abortion care that we need," said Fluke, who gained nationwide attention in 2012 when radio commentator Rush Limbaugh called her a slut after she testified before congressional Democrats in favor of health plans covering birth control.

"This doesn't mean turning away from the fights we've historically fought, but it means making sure we are moving to these new frontiers," she said.

At that point Fluke broke out in a sweat, said she was feeling dizzy and sat down. Seated next to her were Assemblywoman Toni Atkins, D-San Diego, and Sen. Hannah-Beth Jackson, D-Santa Barbara. They tended to Fluke with glasses of water and napkins dipped in ice. After several minutes, Fluke took off her jacket and returned to the podium.

"What did you learn about women's health at this conference?" Fluke said. "That it's important to eat breakfast and lunch."

Then she complained that her high heels were hurting, took off her shoes and offered some advice to the audience before finishing her speech in bare feet:

"Reject ridiculous beauty standards," she said. "Wear shoes that don't make you feel like you're going to fall over when you're giving a speech."

PHOTO: Lawyer and women's health activist Sandra Fluke at a campaign event for Rep. Ami Bera, D-Elk Grove, in October 2012. The Sacramento Bee/Lezlie Sterling

Lawmakers representing drought-stricken districts joined with hundreds of their constituents at the state Capitol on Thursday to press for a new water bond measure and the declaration of a drought emergency.

"I see farmers, I see farmworkers; I see people from urban communities and from rural communities, all here today to send one message: that we need water," said Assemblyman Henry Perea, D-Fresno.

A procession of Democratic and Republican lawmakers, most representing the Central Valley, took the podium to issue similar pleas. Many called for money to ensure clean drinking water and for more storage capacity, saying it would offset dry years by allowing the state to capture more during years of plentiful rain.

"Additional storage is the key," said Sen. Tom Berryhill, R-Twain Harte. "This year's drought simply underscores how critical the situation has become."

A sea of blue signs reading "sin agua=no ay futuro" (no water, no future) or some variation backdropped the speakers, highlighting the California Latino Water Coalition's role in organizing the rally.

"2014 is going to be one of California's worst water supply years in recent history," said Mario Santoyo, director of the coalition. He called the shortfall an issue not just for reduced food production, "but more importantly for those that are here, the issue is that when there is no water, there's no jobs."

Condoleezza Rice is in demand.

The former secretary of state is scheduled as the keynote speaker at two upcoming events, including the California Republican Party's spring convention March 15 in Burlingame. The lunchtime speech comes as GOP Chairman Jim Brulte works to revive the party here and begin chipping away at the California Democratic Party's dominance.

"Secretary Rice is one of our most respected and popular leaders in our country and her personal story is a powerful example of strength, intelligence, and dignity," Brulte said in the announcement Thursday. "This is a terrific opportunity for our party members to spend time with a true pioneer of foreign policy and we're honored to have her join us."

Rice, who teaches at Stanford University, received praise from inside the party for the speech she gave at the Republican National Convention in 2012. She is expected to be a key voice for the party on economic inequality as the midterm elections approach.

On Tuesday, the National Republican Congressional Committee chose Rice as its keynote speaker at the committee's annual fundraising dinner in March. In its statement, NRCC Chairman Greg Walden said Rice's life embodies the American dream.

"From growing up in the Jim Crow-era south to traveling the world as the nation's top diplomat, she is living proof that our country is the land of opportunity," he said. "The House Republican majority is committed to ensuring that all Americans have the opportunity to live a full and prosperous life--free from government intrusion. We look forward to hosting her and working with her to grow that majority in 2014."

PHOTO: Former Secretary of State Condoleezza Rice speaks to the delegation at the Republican National Convention in Tampa, Florida, on Aug. 29, 2012. (Lionel Hahn/Abaca Press/ MCT)

Republican Abel Maldonado confirmed Thursday he is dropping out of the race for governor, abandoning a campaign that struggled from the start.

"Today I'm withdrawing my candidacy for governor of California," Maldonado said at a news conference in Santa Maria, his home town. "Now is my time to step away."

Though no Republican is likely to unseat Gov. Jerry Brown in this heavily Democratic state, Maldonado was once thought the likeliest Republican to advance to the runoff against him in November. Many Republicans believed fielding Maldonado, a moderate Latino, could improve the diminished party's standing with Latino voters.

But Maldonado's support for temporary tax increases while in the Legislature alienated many conservatives, and his efforts to raise money fell flat.

Maldonado's campaign announced late Wednesday that he would make a "major announcement" at the news conference, but his advisers declined to comment ahead of the event. The Bee this morning reported he was quitting the race.

In exiting, Maldonado will record his third straight campaign failure. He lost his campaign for a seat in Congress in 2012 and, two years before that, his bid to keep his appointed post as lieutenant governor.

Maldonado's exit leaves Twin Peaks Assemblyman Tim Donnelly, a more conservative candidate, as the only Republican actively campaigning against Brown.

Neel Kashkari, a former U.S. Treasury Department official, is expected to declare his candidacy soon.

As part of his campaign, Maldonado announced last year that he would file a ballot initiative to repeal California's historic prison realignment, the 2011 law in which the state shifted responsibility for certain low-level offenders to counties.

No initiative has been filed, and Maldonado sidestepped a question about the initiative's future at his news conference Thursday.

"It just needs support, and I hope we can get that in the future," he said.

Editor's note: This post was updated at 11:48 a.m. to include Maldonado's remarks and reporting by Matt Fountain of The Tribune of San Luis Obispo.

Matt Fountain of The Tribune of San Luis Obispo contributed to this report.

PHOTO: Republican Abel Maldonado walks to a news conference in Sacramento on Wednesday, May 8, 2013. The Sacramento Bee/Hector Amezcua

Abel Maldonado, whose campaign for governor sputtered for months and failed to gain the support of Republican donors, has told other Republicans he will drop out of the race today, sources said.

The former lieutenant governor is expected to make the announcement at an 11 a.m. news conference in Santa Maria, his home town.

The announcement will end weeks of speculation about Maldonado's political future. After heavily promoting the re-launch of his campaign last fall, Maldonado has largely faded from public view. It has been nearly two months since he last reported receiving a major contribution.

Maldonado's exit leaves Twin Peaks Assemblyman Tim Donnelly, a more conservative candidate, as the only Republican actively campaigning against Gov. Jerry Brown.

Neel Kashkari, a former U.S. Treasury Department official, is expected to declare his candidacy soon.

No Republican is expected to unseat Brown in this heavily Democratic state, but Maldonado, a moderate, was once considered the likeliest Republican to advance to the November runoff against him.

But Maldonado's campaign was damaged by missteps from the start. Maldonado came under criticism in May when he announced a ballot initiative to repeal California's prison realignment program but highlighted a menacing photograph of an offender who was not released under the program.

Then, after finishing the first half of last year in debt, Maldonado and his original team of advisers split. Maldonado assembled a new group of advisers, including Ron Nehring, the former California Republican Party chairman, and he presented the team at the state party's convention last fall.

Neither Maldonado nor his advisers responded to repeated requests for comment. The candidate said on Twitter late Wednesday, "Jerry Brown is a good Governor; I'd be a better one."

PHOTO: Abel Maldonado speaks to reporters in Sacramento on May 8, 2013. The Sacramento Bee/Hector Amezcua

Debate has raged over how best to regulate spending under the state's new "Local Control Funding Formula," which would allocate millions of extra dollars to school districts to support low-income and English-learning students. Civil rights groups and school officials have been sharply divided, with advocates calling for tight oversight of how the money is used while school districts seek more flexibility.

The plan was championed by Gov. Jerry Brown, but the decision ultimately comes down to the state Board of Education, which will vote on final regulations today during their meeting at the Department of Education on N Street. The hearing begins at 8:30 a.m. and dozens are expected to testify.

The stakes are high, so whatever the outcome, this decision certainly won't be the end of the story. Dan Walters has more on the controversy in his column.

VIDEO: A new bill from Assemblyman Mike Gatto, D-Los Angeles, would ban "affluenza" as a legal defense, but that's just common sense, Dan Walters says.

APP-Y NEW YEAR: The Sacramento Bee is pleased to announce a major update and new design for the Capitol Alert Insider Edition app.

The new 2014 version:

• Works on both your iPhone and iPad with a single subscription.
• Offers faster access to our bills-to-watch guide and legislative directory, along with new district maps.
• Includes a new section on legislative committees.
• Lets Insider Edition app subscribers comment and share with one another.
• Includes all the previous Insider features, including early access to Field Polls and Bee editorials on state topics and a curated Capitol Twitter feed. Easily email chiefs of staff, schedulers and legislative directors from within the app.

To subscribe, go to www.sacbee.com/insider. It's free this week, $19.99 a month after that.

H2-OH NO: As California's water crisis deepens, farmers continue to wait for Gov. Jerry Brown to make the official drought declaration. Assemblyman Henry Perea, D-Fresno, and a dozen other legislators, mostly from the Central Valley, will gather on the west steps of the Capitol at 11 a.m. to call for a drought declaration and rally in support of placing a water bond on the 2014 ballot.

POWER UP: A star-studded line-up of Sacramento politicians is joining the California Center for Research on Women & Families for today's policy summit on women's health, wealth and power at the Sacramento Convention Center from 9 a.m.-4:30 p.m. Among those slated to speak are Assemblywoman Bonnie Lowenthal, D-Long Beach; state Sen. Hannah-Beth Jackson, D-Santa Barbara; Assemblywoman Nancy Skinner, D-Berkeley; state Sen. Holly Mitchell, D-Los Angeles; state Sen. Carol Liu, D-La Cañada Flintridge; Assemblywoman Cristina Garcia, D-Bell Gardens; and Diana S. Dooley, the state secretary of health and human services. The event's keynote speaker is Sandra Fluke, who first made headlines when she testified before Congress that insurance plans should cover birth control.

GOING UNDER: The Assembly Select Committee on Sea Level Rise & the California Economy will hold its fourth and final hearing from 9 a.m.-12:30 p.m. in Room 126 of the Capitol. State agencies such as the San Francisco Bay Conservation and Development Commission and the Coastal Commission will testify on how they are addressing the threat. The committee plans to release a report with legislative recommendations in late February.

IN THE BIG HOUSE: The leaders of California's three public higher education systems--Janet Napolitano of the University of California, Timothy P. White of California State University and Brice Harris of the California Community Colleges--will all be in Washington, D.C., today for President Barack Obama's summit on increasing college access for low-income and disadvantaged students. The event begins at 9 a.m. EST and continues through the day. Follow the action from 3,000 miles away on Twitter with the hashtag #OpportunityForAll.

HEALTH CARE CONCERNS: The Sacramento Press Club hosts former Congressman and California Department of Finance director Tom Campbell for a luncheon at the Capitol Plaza on Ninth Street at noon. Campbell, who is now the dean of Chapman Law School, will discuss how non-profit hospitals are adjusting to the Affordable Care Act and potential new state insurance mandates.

ARE YOU FEELING LUCKY?: The jackpot isn't quite as big as last month's Mega Millions lottery, but candidates for April's local elections will find out the order their names appear on the ballot at 11 a.m., when the Secretary of State's office holds a randomized alphabet drawing.

Editor's Note: This AM Alert was updated at 10:26 a.m. Jan. 16 to correct that the Select Committee on Sea Rise & the California Economy is in the Assembly.

PHOTO: A second-grader reads her assignment in her English language learning class at Cordova Villa Elementary School on Monday, June 10, 2013 in Rancho Cordova, Calif. The Sacramento Bee/Randy Pench.

A new bill from Assemblyman Mike Gatto, D-Los Angeles, would outlaw "affluenza" as a legal defense, but that's just common sense, Dan says.

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

See other Dan Walters Daily clips here.

PHOTO: Assemblyman Mike Gatto, D- Los Angeles, leaves a hearing on Tuesday, Aug. 23, 2011. The Associated Press/Rich Pedroncelli.

In case you missed it:

University of California President Janet Napolitano evaluated Jerry Brown's budget.

Darrell Steinberg sounded a little tentative about the Delta tunnels.

Tom McClintock appears to be drawing a challenger.

Assemblyman Mike Gatto wants to ban the "affluenza" defense.

Dan Walters critiqued the Assembly and Senate websites.

From The State Worker:

A reader poll assessed how easy it is for sick state workers to take time off.

New Capitol Alert Insider Edition app:

Have you downloaded the new app yet? It's free this week so you can check it out. The new version:

• Works on both your iPhone and iPad with a single subscription.
• Offers faster access to our bills-to-watch guide and legislative directory, along with new district maps.
• Includes a new section on legislative committees.
• Lets Insider Edition app subscribers comment and share with one another.
• Includes all the previous Insider features, including early access to Field Polls and Bee editorials on state topics and a curated Capitol Twitter feed. Easily email chiefs of staff, schedulers and legislative directors from within the app.

You can find it under Capitol Alert in the app store. An Android version is coming soon.

In tomorrow's Bee:

State and federal officials assured Capitol Hill lawmakers Wednesday that California's $68 billion high-speed rail system would move forward. Curtis Tate has the story.

Are state scientists underpaid? Jon Ortiz addresses the issue in The State Worker.

The massive spending bill the House of Representatives passed Wednesday includes $72 million for Sacramento flood-protection efforts.

Lawmakers approved the $1.1 trillion, 1,580-page budget plan on a vote of 359-67.

"Today's vote demonstrates that we can deliver for the American people when we work together and compromise in a bipartisan fashion," said Rep. Doris Matsui, D-Sacramento.

Of the $72 million, $2.5 million would go toward design work on an ongoing project to improve levees around Natomas and Sacramento.

The balance of the funds would also further the goal of protecting the Sacramento region from a 200-year flood.

Two separate projects at the Folsom dam would receive $69.5 million, to help raise the dam and construct an auxiliary spillway.

Matsui, who has long championed funding for Sacramento flood-control projects, said she would push to have more money set aside from a $90 million reserve fund.

Three California Republicans were among the 67 nays: Reps. Doug LaMalfa, Tom McClintock and Dana Rohrabacher.

In a floor speech, McClintock slammed items in the bill he considered wasteful spending. Among them: TIGER, a discretionary Department of Transportation grant program, "which, under the guise of transportation puts money into projects like a 6-mile pedestrian mall in Fresno and streets that discourage cars," McClintock said.

The Senate is expected to take up the legislation by week's end.

PHOTO: Former Gov. Arnold Schwarzenegger tours the Natomas Cross Canal levee wave wash protection project, Tuesday Jan. 3, 2005. The Sacramento Bee/Brian Baer

University of California president Janet Napolitano on Wednesday called Gov. Jerry Brown's recent budget outline a "good starting point" for higher education funding in California.

The governor's proposal, released last week, awarded the UC system an additional $142.2 million from the General Fund in 2014-15, a 5 percent increase from last fiscal year.

Meeting with The Sacramento Bee's Editorial Board, Napolitano did not explicitly call for more funds, but said: "We'll have a discussion about what else can the university do and what other needs that we have."

"We all know state funding had to get slashed (during the recession). I can appreciate the difficult decisions that had to be made," she added. "But we've leveled off now."

Napolitano, a former Arizona governor and Secretary of the U.S. Department of Homeland Security who assumed the office of UC president in September, was in Sacramento Wednesday for meetings, including a noontime gathering with legislators.

During her hour-long discussion with The Bee, Napolitano touched several times on Gov. Brown's budget, which also ties funding increases for UC and CSU to tuition freezes and creates a $50 million "innovation grant" program to develop ways to get more students graduated with degrees faster.

With California's public universities expected to maintain their current fee levels through 2016-17, Napolitano said her focus will shift to guarding against future tuition volatility. The UC has previously seen massive spikes in tuition after extended freezes -- such as a 40 percent jump from 2002 to 2004 following nearly a decade of freezes and reductions.

Napolitano said she didn't expect to roll back any of the most recent tuition hikes "unless the state substantially increases the amount it puts into the university -- and I don't foresee that."

Among Napolitano's pitches for the innovation grant was an interactive database that she is developing with the CSU and community college chancellors to track community college students who are interested in transferring to four-year schools. The database would help guide students' study plans to smooth their transition to the UC or CSU systems.

She was more skeptical about massive open online courses, which have been a favorite of Brown's.

"The idea that you can just have an online course and that's gonna solve all your problems and cut your costs...that's no silver bullet," Napolitano said. "But it is a tool."

UC is currently experimenting with a few online programs to augment its educational mission, she said, such as a pilot slate of multi-campus classes for the spring that would allow students to take some required courses not offered at their campus remotely.

Next, Napolitano heads to Washington, D.C., where she will meet Thursday with President Obama and other university leaders from across the country to discuss improving college access for low-income students.

Napolitano has publicly expressed doubt about her former boss' plan to develop a scorecard measuring the value of colleges. She told The Bee Wednesday that federal government's role in higher education should primarily be to provide research funding, of which the University of California receives about $4 billion per year.

Video highlights:

PHOTO: New UC President Janet Napolitano meets with editorial board at the Sacramento Bee on Wednesday, January 15, 2014. The Sacramento Bee/Hector Amezcua

With California into a third year of dry weather and several cities imposing restrictions on water use, the time has come for state leaders to "seriously consider" putting another water bond on the ballot, Senate leader Darrell Steinberg said today.

"I think what's going on now creates an urgency to seriously consider putting a bond on the ballot in 2014, and not later," Steinberg said.

The Legislature has twice deferred putting a water bond on the ballot since lawmakers approved doing so in 2009. Gov. Jerry Brown has been noncommittal about whether he thinks voters should be asked this year to approve bond spending on new water projects.

Steinberg said lawmakers need to work on re-writing a water bond for 2014 as well as spending money from prior bonds to address immediate needs.

"When it comes to giving our regions and our local governments the resources necessary to increase water supply, we need to look at those bonds," he said.

"And we ought to consider early in the session working together to appropriate whatever resources are necessary to help California through this particularly difficult time when it comes to water."

The Sacramento Democrat also said state leaders should re-think how they approach the controversial Bay Delta Conservation Plan, which would create two massive tunnels for moving water from north to south. He urged a focus first on measuring how much water could be saved through conservation, recycling and other means.

"That might help us define how much water needs to be ultimately available through an alternative facility around the Delta," Steinberg said.

Sacramento council votes to enact severe water restrictions

Looks like Rep. Tom McClintock will get a challenge from the left.

Democrat Kris Johnson plans to run in the Republican-dominated 4th Congressional District.

The Granite Bay resident filed the necessary paperwork to run just days after news anchor Walt Gray ended speculation that he would mount an independent campaign against McClintock, a rock-ribbed Republican.

Johnson, who has yet to formally announce her candidacy, said in a message posted to her website that she was frustrated and angry about the poor performance of elected officials to stem the economic crisis in the Foothills.

The local economy has been stalled for too long, she said.

"The future does not look bright for our children and grandchildren," she said. "There are not enough jobs in our district to keep our children here. Housing is unaffordable for those earning low wages or starting salaries."

She also took aim at Republicans for their role in the partial government shutdown and for voting dozens of times to repeal all or parts of the federal health care law.

"The singular focus on cutting spending is starving our country of the very jobs that can change our economy for the better," she said. "Cutting expenses in a household is a very slow approach to money problems. The solution is to get more income. Income pays down debt in a household. Jobs will pay down debt in our country."

4th Congressional District

The redrawn 4th district is among the most conservative in the state. It is 45 percent Republican, 30 percent Democratic and 21 percent independent.

The district also is arguably the nation's most picturesque, taking in portions of Roseville; it extends from Lake Tahoe past Yosemite National Park.

McClintock lives outside of its boundaries in Elk Grove. After winning a close congressional race in 2008, the former state lawmaker and perennial candidate for statewide office has cruised to re-election.

Born in Wisconsin, Johnson was 13 years old when her parents became ill and she was moved to a children's home as a ward of the state of Indiana. She held jobs with Amoco Oil, 3M Company before moving to Northern California 25 years ago with her husband, John, to work at Intel Corporation.

PHOTO: Kris Johnson for Congress

Wealthy defendants beware: Under a new California bill, you could no longer invoke the psychological effects of those distorting dollars.

People concerned about a multi-tiered justice system that favors the rich found some evidence during the trial of Ethan Couch, a Texas teen who cut down four people with his car while driving drunk.

Despite those deaths, Couch received a lenient sentence with no jail time. His defense team reportedly argued that a money-infused upbringing had clouded the teen's judgment, giving him a skewed sense of consequences (or lack thereof).

Now Assembly Bill 1508, by Assemblyman Mike Gatto, D-Los Angeles, would bar the so-called "affluenza" defense from being deployed in California courts.

Gatto said the Couch case had outraged people who felt justice was not served. He paraphrased the type of defense he's trying to remove from attorneys' toolboxes as "the kid had an over-privileged upbringing but now he's learned his lesson, your honor."

"When this defense was raised, it really just offended most peoples senses of what's fair," Gatto said. "I think our laws need to reflects society's values and if they reflect society's values they will say this defense shouldn't be recognized."

The legislation would not prevent defense attorneys from arguing that their client had suffered from an abusive upbringing, Gatto said. He argued that defense tactics evolve over time, noting that the insanity defense arose relatively recently.

"I just think it really is one of those times where unless we're proactive it could become something that's far more common," Gatto said.

PHOTO: Assemblyman Mike Gatto, D- Los Angeles, leaves a hearing on Tuesday, Aug. 23, 2011. The Associated Press/Rich Pedroncelli.

The past year has not been a great one for California's Department of Toxic Substances Control, which oversees hazardous waste management in the state. News reports exposed major deficiencies in the agency's operation, including the revelation that it could not account hundreds of thousands of hazardous material shipped for disposal over the past five years.

The Senate Environmental Quality Committee will consequently hold a hearing at 9:30 a.m. in Room 3191 of the Capitol Building to consider steps that can be taken to strengthen enforcement of the state's laws governing toxic waste. The department's director, Debbie Raphael, is among those expected to testify.

Following the hearing, the committee will take up several bills, including one from Sen. Kevin de León, D-Los Angeles, that would speed up the permitting process for hazardous waste facilities and one from Sen. Ricardo Lara, D-Bell Gardens, that would require all facilities to obtain a permit by 2015 or shut down. A study commissioned by Raphael found that a quarter of the state's hazardous waste facilities are currently operating on expired permits.

VIDEO: With the ease of digital access, government agencies should be more forthcoming with public information, Dan Walters says.

BAG BAN: State Sen. Alex Padilla's bill to ban single-use plastic bags in California fell just short in the Senate last year, but the Los Angeles Democrat continues to push ahead with the idea. He will attend a city council meeting in West Sacramento at 7 p.m. to show support for a resolution supporting his bill.

FUNDING FUN: With the state Board of Education set to adopt regulations for its new school funding formula tomorrow, groups are already gathering in Sacramento to throw their voices into the debate. Calling for stricter controls on how additional funding for low-income and English-learning students is spent by local school districts, the Parent Leadership Action Network and Californians for Justice--two Bay Area organizations that advocate for minority and disadvantaged students--will lead a rally outside the Department of Education building on 14th Street at 8 a.m.

DELTA TUNNELS: A statewide series of twelve informational open houses about the controversial Bay Delta Conservation Plan kicks off today in Bakersfield. The sessions, including one in Sacramento on January 30, provide attendees with an opportunity to meet individually with members of the project team and to submit public comment on the proposed Delta tunnels.

IMMIGRATION DOC: "Rape in the Fields," a documentary from Frontline and Univision, takes a look at the sexual abuse suffered by female farm workers, many of whom are undocumented, at the hands of their field bosses and co-workers. The Sacramento Press Club hosts a screening of the film at 6:15 p.m. at the Crest Theater on K Street. The program is preceded by a cocktail reception at 5:30 p.m. and followed by a Q&A session with the filmmakers and reporters at 7:15 p.m.

PHOTO: Matthew Thomas sorts a delivery of used fluorescent bulbs at the Central Contra Costa Sanitary District's household hazardous waste collection facility in Martinez on March 30, 2011. Kristopher Skinner/Contra Costa Times

New website plans from CalPERS and the state Senate obscure, rather than reveal, how they're using taxpayer money, Dan says.

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PHOTO: The recently redesigned and relaunched state Senate website.

Neel Kashkari, apparently close to announcing his campaign for governor, met Tuesday with the Republican caucuses of both houses of the state Legislature.

"It was important for me, before I make a final decision, that they had heard directly from me about the issues that I'm focused on, and that I could hear from them," the former U.S. Treasury Department official said. "The feedback was great."

Kashkari, who ran the Troubled Asset Relief Program during President George W. Bush's administration, is expected to join former Lt. Gov. Abel Maldonado and Assemblyman Tim Donnelly, R-Twin Peaks, in a small field of Republicans challenging Gov. Jerry Brown.

Kashkari is scheduled next Tuesday to give his first speech since leaving his job at Newport Beach-based Pacific Investment Management Co. a year ago. He is listed as the keynote speaker at a business luncheon at Sacramento State.

Kashkari said it will be a "major speech," adding, "You should come to that."

PHOTO: Neel Kashkari, then interim assistant Treasury secretary for financial stability, speaks during an event for the Institute of International Bankers on Oct. 13, 2008, in Washington. AP file photo/Haraz N. Ghanbari

A Senate deal to extend unemployment benefits that expired last month fell apart Tuesday, leaving more than 1.4 million jobless Americans without aid, including 220,000 Californians.

The chamber failed to advance an unemployment extension measure on a largely party-line vote of 55-45. Though some lawmakers said they'd try again, it's unlikely to be soon. The Senate will pivot Wednesday to a $1.1 trillion spending bill agreed to by House and Senate leaders.

In the end, Democrats and most Republicans simply couldn't agree on how to pay for the proposed three-month extension in unemployment aid.

Sen. Barbara Boxer, D-Calif., said no concessions were enough to satisfy Republicans, who demanded the measure be offset by spending cuts.

"I have to say what I think is going on," she said in a statement. "They don't want to extend unemployment compensation for the long-term unemployed."

That wasn't true in the case of Sen. Dean Heller, R-Nev., who co-sponsored the bill. Nevada, like California, has suffered from high unemployment since 2008 after the recession and housing crash.

Sen. Dianne Feinstein, D-Calif., warned that with long-term unemployment at its highest since World War II, the failure to agree on an extension could put more Californians at risk.

"It is incredibly disappointing that this all-important extension has been derailed by more partisan squabbling," she said in a statement.

PHOTO: U.S. Sen. Barbara Boxer, D-Calif., addresses reporters during a news conference on Capitol Hill in Washington on Sept. 14, 2012. Associated Press/ Manuel Balce Ceneta.

The state Senate's Rules Committee, led by Senate President Pro Tem Darrell Steinberg, has appointed a close friend of Steinberg's to a $128,000-a-year position on the California Unemployment Insurance Appeals Board.

John Adkisson began the post yesterday, said Mark Hedlund, a spokesman for Steinberg. He said Adkisson is filling a position left vacant by the resignation of Kathleen Howard. The board meets once a month.

Adkisson had been making $300,000 a year on contracts with the Senate's Oversight and Outcomes Commiitee and the Legislative Counsel. Those contracts are now over, Hedlund said.

The relationship between Steinberg and Adkisson dates back to their law school days. Adkisson ran Steinberg's first political campaign in 1992, when he ran for Sacramento City Council. Steinberg told The Bee in 2009 that he considers Adkisson "one of my dearest friends. "

Hedlund said Tuesday that Adkisson is a good pick for the Unemployment Insurance Appeals Board because of his depth of experience in employment law.

California Senate President Pro Tem Darrell Steinberg said today that "it is clear" Sen. Kevin de León will be the next leader of the state Senate.

"I think he will be a great leader. He's adept at both the policy and the political side," Steinberg said as he and de León emerged from a meeting of Senate Democrats this afternoon, in which the majority party discussed leadership of the house but did not take a formal vote.

"It was a good conversation and the caucus embraced my message. I think we're well on our way. I support Kevin very strongly," Steinberg said.

Steinberg said he told fellow Democrats that he intends to remain the leader of the state Senate until his term ends in November, and that he will call for a vote on de Leon's leadership after the budget is complete in June. It remains unclear whether another candidate will emerge, although Steinberg said he doesn't anticipate anyone else jumping into the race.

"I'm looking forward to leading when my time comes up," said de León, D-Los Angeles.

"I'm deeply honored to have his support and the support of my colleagues. I love the Senate."

The announcement came a day after Sen. Mark DeSaulnier said he was pulling out of the race because he plans to run for Congress this year. The Democrat from Concord is running for the seat vacated by Rep. George Miller, who announced his retirement Monday.

De León said Tuesday that DeSaulnier had given him his support.

Both de León and Steinberg have been accused by their colleague, Sen. Ron Calderon, of being the focus of an FBI sting. They refuted the allegation again Tuesday, saying Calderon is the sole target of the federal corruption investigation.

PHOTO: Senate leader Darrell Steinberg, left, congratulates Sen. Kevin de León as they leave the Democratic caucus this afternoon. The Sacramento Bee/Laurel Rosenhall

Advocates are decrying a budget proposal that would restrict hours for in-home helpers of elderly and disabled Californians.

In an effort to save money on Medi-Cal, the state's health insurance program for low-income Californians, Gov. Jerry Brown's budget seeks to bar people employed by the state's in-home supportive services program from putting in overtime.

By limiting those workers to 40 hours a week, Brown would sidestep a new federal rule -- which takes effect Jan. 1, 2015 -- requiring additional overtime pay for domestic workers. Currently, California's in-home supportive workers can work more than 40 hours a week but are paid straight time for the extra hours.

Advocates say the governor's call to prohibit overtime work, regardless of the pay level, would cause significant financial hardship for the in-home workers California dispatches to care for low-income residents who require extra assistance.

"Sending IHHS caregivers deeper into poverty not only harms the caregivers, but it puts seniors and people with disabilities at great risk," Gary Passmore of the Congress of California Seniors said during a Tuesday morning press conference on the steps of the state Capitol.

The rule would also disrupt the lives of people who rely on the program, many of whom find comfort in the stability of being consistently tended to by the same caretaker, advocates argued.

"Autistic individuals have a really hard time with changes, with new people and new situations," Martha Cobos, a Sacramento woman whose autistic twins require constant care, said on Tuesday. "The governor wants me to find another person to take care of them," she added. "With changes like that, they get really stressed."

In-home supportive services are not covered by a new law, enacted at the start of 2014, that secured overtime pay for other domestic workers. Many of the people who rely on in-home supportive services are low-income, so Assemblyman Tom Ammiano's office was wary of burdening them with an overtime pay requirement.

The proposed overtime ban seems especially inappropriate to advocates given that a surge of revenue has put California on its firmest fiscal footing in years. Brown has preached a cautious approach to the windfall, repeatedly invoking the word "prudence" as he unveiled his budget and seeking a constitutional amendment shoring up the state's rainy day fund.

"The governor talks a lot about a rainy day fund - well, Gov. Brown, it's raining," Passmore said on Tuesday. "For the people here who are caregivers, for the people they take care of, it's pouring."

PHOTO: In-home supportive services workers protest a proposed overtime cap at the State Capitol in Sacramento, Calif. on January 14, 2014. The Sacramento Bee/Alexei Koseff.

Roger Salazar, a former spokesman for President Bill Clinton and Gov. Gray Davis, is leaving Mercury Public Affairs to open his own firm. Mercury separately announced today hiring two new staff for its Sacramento office.

Salazar's new firm, Alza Strategies, will provide media relations, crisis communication and public affairs services to clients that want to reach California's Latino market. The Legislature's Latino Caucus Leadership PAC and the Agua Caliente Indian tribe are among Alza's clients, Salazar said.

"'Alza' is Spanish for 'rise,'" Salazar said in a statement announcing his firm. "With California's economy, Latino population and political clout on the rise, Alza hopes to similarly raise the level of media communications on behalf of clients who want to tap into this market."

Also today, Mercury Public Affairs announced hiring Carolyn Becker, a former executive producer at KCRA, and Argelia León, who specializes in Spanish language media. Becker will be a senior vice president at Mercury and León will be a director.

"Carolyn and Argelia will give our clients an even broader and more diverse set of ideas, tactics and initiatives," Mercury partner Adam Mendelsohn said in a statement.

PHOTO: Sacramento County Sheriff candidate Capt. Jim Cooper gets campaign results from his campaign manager Roger Salazar in June 2010. The Sacramento Bee/Renee C. Byer

Gov. Jerry Brown began the second day of a two-day swing through inland California on Tuesday. It is a conservative region that has proved deeply skeptical of the Democratic governor, despite his high approval ratings statewide.

Brown has visited the Valley only a handful of times since taking office in 2011, but he said at a news conference in Bakersfield "you'll see me more often in the months ahead."

Brown is preparing for a likely re-election bid this year.

PHOTO: California Gov. Jerry Brown addresses the media at Fresno City Hall on Jan. 13, 2014 in Fresno. The Fresno Bee/Eric Paul Zamora

Beset by processing delays and customer confusion, two providers offering health coverage through California's new insurance exchange have pushed back their premium payment deadlines.

On Tuesday, a spokesman for Anthem Blue Cross of California said the company was pushing back its payment deadline to Jan. 31. Meanwhile, Kaiser Permanente set its new payment due date for Jan. 22.

Covered California had already extended its payment deadline for people with coverage beginning Jan. 1. The exchange's deadline is Wednesday, a change from the earlier deadline of Jan. 6.

A Covered California spokesman said the exchange's deadline would remain Wednesday.

"It's a deadline that was agreed unanimously to by the 11 health providers," spokesman Roy Kennedy said.

People who signed up for health coverage through the exchange have been complaining about long delays in receiving invoices needed to pay their first monthly premium. Others who made their payments are awaiting confirmation. Officials at Covered California and several insurance companies have acknowledged the raft of delays, including exceedingly long wait times for telephone customer service questions.

"We have extended the payment deadline for Jan. 1 coverage to Jan. 22 for those affected by processing delays, to allow all of our members time to receive and pay their invoices," Kaiser spokesman Chris Stenrud said.

"We have also started an outbound call campaign to reach members proactively to help them make payments on-line or by phone, and to know how to get needed care."

Stenrud noted that the "overwhelming majority" of those who enrolled in coverage that began this year have already received their invoices and paid for their coverage.

PHOTO: Enrollment operators take phone calls during the launch of Covered California in Rancho Cordova on Tuesday, Oct. 1, 2013. The Sacramento Bee/ Randall Benton

Assemblyman Mark Stone, D-Scotts Valley, wants to rid California of butts.

Intent on reducing the amount of non-biodegradable waste that lingers in California's waterways and clogs its beaches, Stone will introduce a bill on Tuesday that prohibits the sale of filtered cigarettes.

Unlike a bill introduced Monday to prohibit the sale of tobacco online, Stone's bill isn't designed to reduce tobacco consumption. Instead, it would fight what Stone called one of the most commonplace environmental threats.

"I am determined to try to address plastic pollution," said Stone.

Penalties for littering have not dissuaded Californians from dropping their filters in nature, Stone said, so he's trying to address the source. The spongy filters that keep many beach cleanups going are also excellent at absorbing toxins, Stone said.

"As soon as they're discarded in the environment, there's a little toxic bomb that's now out there to proliferate whatever toxins it's carrying," Stone said.

If enacted, the bill would mean Californians could only purchase unfiltered cigarettes, which tend to be harsher. Stone rejected the notion that the lack of filters would endanger public health, and his staff point to research questioning whether filters make cigarettes any less bad for you.

"Filters have never been proven to have any effect negative or positive on the effect on the smoker," Stone said.

PHOTO: A Sacramento man smokes a cigarette on the front porch of his home in Sacramento, Thursday, June 11, 2009. The Sacramento Bee/Lezlie Sterling.

FRESNO - Tucked into Gov. Jerry Brown's schedule of meetings here Monday was a tour of a pedestrian mall that, despite a variety of redevelopment efforts over the years, remains a dilapidated fixture of this city's downtown.

Brown was underwhelmed.

"I think I'll keep my thoughts to myself," he said at a news conference when asked for his opinion of the mall.

If the Democratic governor was committing a faux pas, he quickly righted himself, volunteering that parts of Oakland looked like Fresno's Fulton Mall when he was mayor.

"I know from Oakland that downtown can be transformed," he said.

Brown mentioned he saw a restaurant on his tour, and he called the eatery's establishment a "bold move."

The restaurant's owner, Craig Scharton, left his job as Fresno's business development director last year to open Peeve's Public House & Local Market.

Scharton heard Sunday that the governor was coming. Knowing he and Brown share an affinity for dogs, he was prepared.

Accompanied by Peeve, the boxer-shepherd mix for which his restaurant is named, Scharton presented Brown with a card for the governor's Pembroke Welsh corgi, Sutter.
Included were a couple of dog bones, Scharton said, and the message, "To Sutter: If you're ever in Fresno come by for a pint like any good Welshman would."

Sutter is not along for Brown's two-day swing through Fresno, Bakersfield and Riverside, which concludes Tuesday.

Nevertheless, Fresno Mayor Ashley Swearengin, who showed Brown the pedestrian mall, described the occasion as "some nice, sort of diplomatic exchanges among the canine family."

PHOTO: Gov. Jerry Brown addresses the media at Fresno City Hall on Monday, Jan. 13, 2014. The Fresno Bee/Eric Paul Zamora

Crafting a successful budget can be a high-wire balancing act, as the governor seeks broad support from the diverse and often conflicting interests.

One of the first and most important stops has become a meeting with the California Chamber of Commerce, which is often pushing lawmakers for greater fiscal restraint.

When Gov. Jerry Brown's director of finance, Michael Cohen, speaks about the 2014-15 budget proposal before the group today, he might find a more receptive crowd than in years past. With Brown emphasizing paying down debts over starting new public programs, and no new taxes on the docket, this year's agenda features fewer of the kinds of proposals that earn the Chamber of Commerce's dreaded "job killer" label.

Cohen speaks at approximately 12:45 p.m. during a luncheon at the California Chamber of Commerce on K Street.

VIDEO: The impending retirement of U.S. Rep. George Miller, D-Martinez, sets up a game of musical chairs for California's legislative leadership, Dan Walters says.

EASY RIDER: The future is another step closer: Last year, the California Department of Motor Vehicles developed regulations for testing self-driving cars on the state's roadways. They were published in November, and the public comment period for the rules ended yesterday, but there's one more opportunity to participate in the process during a hearing at 10 a.m. at the DMV Headquarters on First Avenue. The regulations are expected to be finalized this spring.

CAP-AND-TRAIN: California's proposed high-speed rail project has been met with one controversy after another--and Gov. Brown's idea to use cap-and-trade funds to get construction started this year is no exception. The California High-Speed Rail Authority will discuss that proposal and other business at its meeting today at 10 a.m. in the Secretary of State's Auditorium on 11th Street.

DEMO DISCUSSION: There was much debate following the 2012 election over what impact increasing diversity might have on the future of national and California politics. Mindy Romero, director of the California Civic Engagement Project, takes a deep dive into those demographic shifts and where their effect is likely to be strongest during a talk called "Is Demography Political Destiny?" at the UC Center Sacramento on K Street at noon.

WAGE WAR: In-home caregivers and their allies will be at the north steps of Capitol at 10:30 a.m. to protest a proposal in Gov. Brown's budget they say would hinder their ability to make a living. The new rule would prohibit caregivers who serve low-income patients through the state's In-Home Supportive Services program from working more than 40 hours per week and earning overtime pay.

POOR MARKS: A report card on the state of education issued last year by StudentsFirst -- the controversial education advocacy group headed by Sacramento first lady Michelle Rhee -- was notoriously harsh, with two-thirds of states earning a D or worse. California was among the unlucky 11 to receive an F. Will the results be just as bleak this year? We'll find out today when the organization issues its report for 2014.

CELEBRATIONS: Happy birthday to Assemblyman Reggie Jones-Sawyer, D-Los Angeles, who turns 57 today.

PHOTO: Michael Cohen, director of the California Department of Finance, testifies to the Senate budget committee in 2011. The Sacramento Bee/Hector Amezcua

U.S. Rep. George Miller, D-Martinez, has announced that he will step down at the end of the year, shaking up the entire conversation around California's legislative leadership, Dan says.

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PHOTO: Rep. George Miller talks about his 40-year career in the U.S. Congress at his Martinez, Calif., home on on Jan. 12, 2014. Bay Area News Group/Jim Stevens

FRESNO - Gov. Jerry Brown, touching off a two-day swing through inland California on Monday, defended his proposal to use fees paid by carbon producers to help finance high-speed rail and suggested he is close to declaring a drought emergency.

Brown is proposing to use $250 million in proceeds from the state's cap-and-trade program to help fund California's $68 billion high-speed rail project. The nonpartisan Legislative Analyst's Office said earlier Monday the proposal "likely would not maximize the reduction" of greenhouse gas emissions and is "legally risky."

"I've looked at the law surrounding AB 32 and the cap-and-trade," the Democratic governor told reporters in Fresno. "I believe it's legal, my lawyers believe it's lawful. It's a very appropriate source of funding."

Some environmentalists have criticized the use of cap-and-trade money for rail, saying other projects could reduce greenhouse gas emissions more immediately.

"Yes, it's long-term," Brown said. "But we aren't all, you know, Twitter-holics that have to have instant gratification after 140 characters. We can take a few years and build for the future, and that's my sense here, that I'm coming back to be governor after all these years. ... It's been on my list for a long time, and I think we've got to get it done. And we do need that funding, and it's legal, and I hope the Legislature will support it."

Brown spent the day in Fresno meeting with law enforcement, agriculture, education and other interests and touring a downtown pedestrian mall. He was pressed at a meeting with water officials to declare a drought emergency, which could accelerate some federal relief measures.

Asked if he would declare a drought, Brown said, "Not today, but we're certainly getting ready."

Brown, who is preparing for a likely re-election bid this year, was scheduled to hold meetings in Bakersfield and Riverside on Tuesday, before returning to the Capitol.

PHOTO: Gov. Jerry Brown speaks with reporters in Fresno on Jan. 13, 2014. The Sacramento Bee/David Siders

State Sen. Mark DeSaulnier said he is pulling out of the race to become the next leader of the California Senate to instead pursue a seat in Congress.

"Can't do both," DeSaulnier said Monday afternoon, a few hours after announcing he plans to run this year for the Congressional seat of retiring Rep. George Miller.

DeSaulnier, a Democrat from Concord, and Sen. Kevin de León, D-Los Angeles, had been the front-runners in a bid to become the next President pro Tem of the state Senate. Current Senate leader Darrell Steinberg is leaving office at the end of this year.

DeSaulnier declined to say whether he would urge his supporters to back de León.

"He came in and said, 'I'd like your support,'" DeSaulnier said of de León. "I told him I'd like to talk to my supporters and see what they think."

De León said the race remains an "ongoing process" and declined to make any predictions, saying just that he plans to talk further with DeSaulnier in hopes of gaining his support.

"He's a senator who I respect tremendously and I'm looking forward to that conversation," de León said.

PHOTO: Sen. Mark DeSaulnier on August 11, 2009. The Sacramento Bee/Manny Crisostomo

The Legislature's nonpartisan fiscal analyst said Monday that Gov. Jerry Brown's new spending plan "would place California on an even stronger fiscal footing," broadly praising the budget plan in the office's initial review.

"The governor's emphasis on debt repayment is a prudent one," the Legislative Analyst's Office said. "Overall, the governor's proposal would place California on an even stronger fiscal footing, continuing California's budgetary progress."

Still, the LAO expressed reservations about the proposal's lack of strings attached to higher education funding and the use of fees paid by carbon producers for high-speed rail.

Brown last week released a $154.9 billion budget that includes modest increases for social services and schools, but also billions of dollars to pay down long-term debt.

The LAO praised Brown for proposing a rainy-day fund, saying that "in general, setting aside money for a rainy day is exactly what the state should be doing when revenues are soaring, as they are now." However, the analyst suggested the fund proposed by Brown may be too unwieldy, and it recommended considering simpler reserve plans.

The LAO also recommended putting some money aside to address the struggling state teachers' retirement fund. Brown's budget plan does not commit money to the fund but pledges to "begin working" on way to stabilize the fund.

Brown's proposal to use $250 million in proceeds from the state's cap-and-trade program to help finance California's $68 billion high-speed rail project is one of the more controversial elements of his plan. The LAO said the proposal "likely would not maximize the reduction" of greenhouse gas emissions, as the project will not be finished by 2020. It called the proposal "legally risky."

On higher education, the analyst criticized Brown for including broad goals for higher education — including reducing costs and increasingly timely degree completion — but tying funding only to keeping tuition rates flat.

"This approach diminishes the Legislature's role in key policy decisions and allows the universities to pursue their own interests rather than the broader public interest," the analyst said.

Brown released his annual spending plan last week, setting the stage for months of budget talks at the Capitol. The LAO said there is "a significant possibility" that revenue estimates "will rise by a few billion dollars" by the time Brown releases his budget revision in May.

PHOTO: Senate President Pro Tem Darrell Steinberg, left, Gov. Jerry Brown, center, and Assembly Speaker John A. Pérez, right, celebrate a budget deal with a formal announcement at the California Capitol on Tuesday, June 11, 2013. The Sacramento Bee/Randy Pench

In an effort to limit underage tobacco consumption, Assemblyman Roger Dickinson, D-Sacramento, has introduced legislation that would prohibit internet sales of cigarettes and electronic cigarettes.

Young people looking to buy tobacco products can circumvent age requirements relatively easily by going online, Dickinson said in a Monday morning press conference. He cited statistics finding that between six and 14 percent of U.S. tobacco sales occur through the web.

"There's supposed to be age verification and notice. It's not working," Dickinson said, so "the next logical step is to simply ban sales through the Internet."

Since those age-checking requirements have proven ineffective, Dickinson said, his bill targets the shipping process. Companies would be barred from sending cigarettes to individuals with California addresses, although Dickinson noted shipments to retailers could continue.

"It doesn't interfere with the flow of commerce otherwise," Dickinson said. "I don't think it has an impact on the conduct of business by legitimate companies for legitimate purposes."

The legislation also addresses the burgeoning market for electronic cigarettes, or e-cigarettes, which deliver a burst of nicotine in water vapor. While e-cigarettes proponents call them a healthier alternative to traditional cigarettes that contain tar and other harmful ingredients, Dickinson warned that the health effects of e-cigarettes remain untested.

"Electronic cigarettes are especially of concern because they are currently largely unregulated," Dickinson said, adding that "the idea that an e-cigarette is simply benign is far from proven."

A bill to restrict e-cigarette use, introduced last year by Sen. Ellen Corbett, D-San Leandro, made it out of the Senate but stalled in the Assembly.

PHOTO: Assemblyman Roger Dickinson, D-Sacramento in the Assembly chambers in Sacramento, Calif. on Monday, March 11, 2013. The Sacramento Bee/Hector Amezcua

The Sacramento Bee's state budget expert, reporter David Siders, takes reader questions about Jerry Brown's budget proposal.

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PHOTO: Gov. Jerry Brown speaks at a news conference at the California state Capitol in Sacramento on Jan. 10, 2013. The Sacramento Bee/Randall Benton

By Christopher Cadelago and Laurel Rosenhall
Bee Capitol Bureau

Rep. George Miller, D-Martinez, said Monday that he will retire after serving 40 years in Congress.

The announcement by the liberal stalwart has set off a scramble of Bay Area politicians seeking to replace him. Sen. Mark DeSaulnier, D-Concord told The Bee he expected to run for the 11th Congressional District.

"I'm playing phone tag with him right now. George is a really good friend," DeSaulnier said. "I wish him well and I would love to replace him in Congress. "It was always my intention to run."

Click here for a map showing DeSaulnier's 7th Senate District and Miller's 11th Congressional District.

A DeSaulnier candidacy could be a big boost for Sen. Kevin de Leon, who was expected to challenge him to replace Senate President Pro Tem Darrell Steinberg as Senate leader this year.

In a statement, Miller, one of the few remaining lawmakers elected in the Watergate era, said he was grateful to have chaired three committees over the last four decades and authored major laws affecting education, labor and health policy, and the protection of natural resources.

"This is a great institution and I cannot thank my family and my constituents enough for having given me the honor and privilege of representing my district in Congress these past 40 years," Miller said. "I have tried to repay them for their confidence by working hard every day to make our country a better place. I'm proud of what I have been able to accomplish on behalf of children, working people and the environment, in my district and for our country, especially passage of national health care reform. Now, I look forward to one last year in Congress fighting the good fight and then working in new venues on the issues that have inspired me. What a wonderful experience this has been."

PHOTO: Rep. George Miller, D-Calif. gestures during a news conference on Capitol Hill in Washington in this Dec. 12, 2006 file photo. Associated Press/Dennis Cook

The Sacramento Bee is pleased to announce a major update and new design for the Capitol Alert Insider Edition app.

The new 2014 version:

• Works on both your iPhone and iPad with a single subscription.
• Offers faster access to our bills-to-watch guide and legislative directory, along with new district maps.
• Includes a new section on legislative committees.
• Lets Insider Edition app subscribers comment and share with one another.
• Includes all the previous Insider features, including early access to Field Polls and Bee editorials on state topics and a curated Capitol Twitter feed. Easily email chiefs of staff, schedulers and legislative directors from within the app.

To subscribe, go to www.sacbee.com/insider. It's free this week, $19.99 a month after that.

Current subscribers can find out how to update here.

Now back to your regularly scheduled AM Alert...

TRANSIT STRIKES: California has traditionally been regarded as very supportive of organized labor, but that climate may be changing. A Field Poll released last month showed that public opinion on unions has plunged dramatically: For the first time ever, more voters say these organizations do more harm than good.

Last year's strikes by Bay Area Rapid Transit workers were especially controversial, raising debate over whether public employees should even be allowed to strike. California voters remain divided on that question, but state Senate Minority Leader Bob Huff of Diamond Bar says the answer is clear. He introduced legislation last September that would prohibit public transit workers from striking in the future.

"If the public is going to have to rely on public transportation, we have to make sure public transportation is reliable," Huff said in a statement last week. "Police and firefighters can't strike; they provide a valuable public service. The same rationale applies here."

How far Huff's bill can go is a big question mark. It faces its first hurdle today, when it is heard by the Senate Committee on Public Employment and Retirement in Room 2040 of the Capitol, following the adjournment of floor session.

VIDEO: Gov. Jerry Brown needs less talk and more action on the state's unfunded liabilties, Dan Walters says.

GHOST GUN-BUSTER: California lawmakers tackled the issue of control last year with mixed success, a new year brings new efforts. State Sen. Kevin de León, D-Los Angeles, plans to introduce legislation banning homemade and 3D-printed "ghost guns," which are untraceable and undetectable. De León will be joined by law enforcement, including Stephen Lindley, chief of the Bureau of Firearms in the California Department of Justice, for the announcement at 11:15 a.m. in Room 1190 of the Capitol.

BURNING UP: Assemblyman Travis Allen's campaign to keep the state from dousing beach bonfires continues. The Assembly Committee on Natural Resources will consider the Huntington Beach Republican's bill to preserve the Southern California tradition at 1:30 p.m. in Room 447 of the Capitol.

LET'S GET TOGETHER: The California Community Colleges Board of Governors gathers for its two-day bimonthly meeting at noon in the Chancellor's Office on Q Street. Sure to be a hot topic is Gov. Brown's budget proposal, which boosted community college funding by 11.4 percent.

The CalPERS Board of Administration is also beginning a three-day meeting in Monterey where, among other agenda items, it will select new leadership.

BUDGET CHAT: The Sacramento Bee's state budget expert, reporter David Siders, takes reader questions about Gov. Brown's budget proposal in a live chat today at noon. Join the conversation at www.sacbee.com/live.

CELEBRATIONS: Happy belated birthday to Assemblyman Steven Bradford, D-Garden, who turned 54 yesterday.

PHOTO: Supporters of Bay Area Rapid Transit workers hold up signs at a news conference outside of the BART 24th Street Mission station in San Francisco on June 25, 2013. The Associated Press/Jeff Chiu

Simply acknowledging the state's billions in unfunded liabilities is not enough, Dan says. Gov. Jerry Brown must do more than hold a poster above his head at a press conference.

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PHOTO: Gov. Jerry Brown discusses his revised budget plan at a news conference at the Capitol on Tuesday, May 14, 2013. Renée C. Byer/Sacramento Bee

We are pleased to announce a major update and new design for the Capitol Alert Insider Edition app.

The new 2014 version:

• Works on both your iPhone and iPad with a single subscription.
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iPhone app annual subscribers:
Please contact Vicky Amparan at 916-321-1889 or vamparan@sacbee.com to get a full refund of your annual subscription. You'll then install the new Capitol Alert Insider Edition universal app and start a new subscription.

iPad app subscribers:
Just update your iPad app to the newest release through the iTunes store. When asked, select restore purchases from the menu. You will be asked to log in to your iTunes account.

Confused? Don't hesitate to call.

PHOTO: Construction workers erect scaffolding around the Capitol dome on May 1, 2002 in preparation for painting. The Sacramento Bee/Randy Pench

Following the release of his new spending plan last week, Gov. Jerry Brown will hit the road Monday for a two-day swing through Fresno, Bakersfield and Riverside.

The trip, including private meetings with local officials and media availabilities in each city, comes ahead of Brown's State of the State address later this month. The third-term Democrat, who travels relatively infrequently, said in October he was hoping to get out more to "get a real-world feel of what's under my responsibility."

Brown, who is preparing for a likely re-election bid this year, will meet with education, water, agriculture, law enforcement and other leaders, his office said in its announcement of the trip Sunday.

"It's an opportunity to get out of Sacramento ... engage with local leaders on some of the big challenges California's facing," spokesman Evan Westrup said.

He said Brown does not plan on the trip to participate in any political events or fundraising.

Brown made his annual budget presentation in Sacramento on Thursday, before visiting Los Angeles and San Diego that same day to promote the proposal.

PHOTO: Gov. Jerry Brown speaks at the California Chamber of Commerce's annual host breakfast in Sacramento on May 22, 2013. The Associated Press/Rich Pedroncelli

A federal judge gave the federal government two months to respond after Sen. Ron Calderon filed charges in November alleging authorities leaked an FBI affidavit accusing him of bribery as retaliation for his refusal to wear a wire in a sting of two fellow state senators.

Those two months are up on Monday -- but don't expect any response from the government.

Turns out Calderon's lawyer, Mark Geragos, did not serve the complaint on the government back when he made the filing in federal court on Nov. 13. The court's 60-day timeline for the government to respond only kicks in once the complaint is officially served.

The Sacramento Bee left Geragos several messages this week to find out what was going on. He never returned the calls.

But he apparently did get around to serving the complaint that asks the court to hold prosecutors in contempt for leaking the 124-page affidavit, and says Sen. Kevin de Leon and Senate leader Darrell Steinberg are the subjects of the FBI's investigation.

"The complaint was not properly served on this office until this week," said an email from Thom Mrozek of the U.S. The US Attorney's Office in Los Angeles.

"Therefore, our response is not due until early March."

Jim Wedick, a former FBI agent who participated in a high-profile corruption sting in the Capitol in the 1980s, said the fact that Calderon's lawyer never served the complaint indicates it was an attempt to generate headlines more than a serious legal maneuver.

"It was a publicity stunt that blew up in their face," he said.

PHOTO: Sen. Ron Calderon, D-Montebello, speaks at a news conference at the Capitol on June 10, 2013. The Sacramento Bee/Manny Crisostomo

Dan Schnur kicked off his campaign to become the state's chief elections officer Friday in Sacramento.

PHOTO: Dan Schnur, shown in September 2010 when he was chair of the FPPC. The Sacramento Bee/Hector Amezcua

Assemblyman Roger Hernández's former lawyer accuses the Fair Political Practices Commission of trying to intimidate and harass him as the watchdog agency investigates whether money laundering occurred in the assemblyman's 2010 campaign, according to court filings The Sacramento Bee obtained Friday.

Aldo A. Flores, who has represented Hernández in earlier brushes with the law, sued the FPPC in September in an attempt to block subpoenas requesting his bank records.

"I tried to reason with them. I contacted them in several instances prior to the lawsuit. They blew me off," Flores said in an interview with The Bee.

"I specifically stated I was trying to avoid litigation. But I had no choice."

Flores made a $3,900 contribution to Hernandez's campaign in late 2009. The FPPC argues that its subpoenas may unveil evidence that someone reimbursed Flores for the donation. Hiding the identity of a donor by passing money through someone else amounts to political money laundering and violates the law.

The FPPC subpoenas — included in Flores's lawsuit — seek monthly statements, copies of checks worth $2,000 or more and various other transaction records from two of his bank accounts during late 2009 and early 2010.

"The subpoenas are overbroad and violative of Plaintiff's rights and lawful privileges," says Flores's suit against the FPPC.

"Defendant FPPC is engaging in frivolous and vexatious tactics, as well as engaging in unethical behavior hoping to intimidate Plaintiff into providing his private bank records."

A hearing to determine whether Flores must comply with the subpoenas is scheduled in Los Angeles Superior Court on January 16.

Hernández issued a statement earlier this week saying "the FPPC has no information that the check was improper."

"Since the beginning of this investigation I have fully cooperated with the FPPC and as such provided all records that have been requested of me. In the 5 years since these allegations were raised, the FPPC has not prompted any official letter of accusation," the statement from Hernandez says.

Hernández has faced allegations of wrongdoing in recent years, but has never been found guilty.

Flores represented Hernández last year when a former girlfriend filed a civil suit alleging that Hernández had hit her with a belt and slammed her into a wall. The woman's lawyers eventually asked the court to dismiss the suit, and Los Angeles County prosecutors decided not to charge Hernández with domestic violence.

Flores also represented Hernández in two lawsuits brought by employees of the City of West Covina, where Hernández served on the city council before being elected to the Assembly in 2010.

PHOTO: Assemblyman Roger Hernández speaks during an Assembly session in 2012. Associated Press/Rich Pedroncelli

California's public education system — not for the first time — has been given a low grade in Education Week's annual state-by-state evaluation of school finances, teacher preparedness, academic achievement and other benchmarks.

The magazine gives California a "D" with a cumulative score of 72.4 on a 100-point scale, 10th lowest among the states. Subpar financing — the lowest in the nation — and poor academic achievement weighed heavily on the state's evaluation.

But the data are not up-to-date, especially the financial data, and a $10 billion boost in state aid to schools proposed this week by Gov. Jerry Brown could improve its standing.

The Education Week finance information, published Friday, is three years old. It pegs per-pupil spending from state and local sources on California's six million students at $8,341 in 2011, a few hundred dollars less than what the state calculated because Education Week adjusts the number downward for California's relatively high cost of living.

That number is the lowest among the 50 states, about $3,500 under the national average of $11,864.

Brown's proposed 2014-15 budget would, he says, raise per-pupil spending to $9,194, but whether it would increase California's standing vis-à-vis other states depends on what they do this year as well.

Clearly, however, it would still leave California well below the national average, whatever it might be. Reaching the national average, California authorities have calculated, would cost at least $18 billion more a year.

California students' performance on achievement tests also drags down the state's standing vis-à-vis other states. It consistently ranks near the bottom in elementary and middle-school reading and mathematics tests and mediocre in high school graduation rates.

Brown, citing the particularly low achievement of poor and "English-learner" students, persuaded the Legislature last year to direct more state aid to districts with large numbers of those kids.

Massachusetts scored the highest in the Education Week evaluation with 91.4 while Nevada was lowest at 65.7.

PHOTO: Pleasant Grove High School students get off their bus on Friday, Feb. 20, 2009. The Sacramento Bee/Hector Amezcua

Assemblyman Jeff Gorell has filed paperwork to qualify a ballot measure that would put the brakes on California's high-speed rail project.

The measure would prohibit the sale of voter-approved bonds for the project. Any unspent money from previously sold bonds would have to be used to pay off the debt.

"California cannot afford to pay for a high-speed train system that will cost most than $100 billion at a time when prisoners are being released from prisons and taxpayers are being asked to dig deeper into their own pockets to pay for basic services," the proposed initiative reads.

Gorell, R-Camarillo, is running for Congress this year against freshman Rep. Julia Brownley, D-Oak Park, in the 26th Congressional District, one of the most competitive House seats in the state.

In November 2008, voters narrowly approved $9 billion in borrowing to help pay for a bullet-train system, which at the time had an estimated cost of $45 billion. Since then, the project's estimated cost has grown to an estimated $68 billion and legal challenges have put the bond money in limbo.

A Field Poll in July 2012 found that 56 percent of likely voters would oppose the rail project if it were up for another public vote, with 39 percent supportive.

The main challenge for Gorell and other opponents, though, will be to raise the money to gather the 504,760 valid voter signatures needed to qualify Friday's measure for the ballot.

Meanwhile, Gov. Jerry Brown, an ardent bullet-train supporter, unveiled a budget this week that would direct $300 million toward the project.

"The high-speed rail is a reducer of greenhouse gases, an enhancement of the quality of California life and a bringing together of our various" communities around the state, Brown told reporters.

Assemblyman Jeff Gorell, R-Camarillo, during session in March 2013. The Sacramento Bee/Hector Amezcua

Immigrants who are in California illegally would qualify for health insurance under a bill Sen. Ricardo Lara plans to introduce.

Details of the plan have yet to be worked out. But Lara, a Democrat from Bell Gardens who chairs the Legislature's Latino Caucus, issued a statement today saying he intends to introduce a measure this year.

"We've made enormous strides to reduce California's uninsured population with the implementation of the Affordable Care Act, but we won't have a truly healthy state until everyone has access to quality, affordable coverage," Lara's statement says.

"Immigration status shouldn't bar individuals from health coverage, especially since their taxes contribute to the growth of our economy."

The federal Affordable Care Act, also known as Obamacare, excludes undocumented immigrants from being able to purchase health care through the new marketplaces states created for selling insurance. After the federal health care program is completely rolled out, experts predict that 3 million to 4 million people in California -- many of them undocumented immigrants -- will not have health care.

Some California counties offer health care to undocumented immigrants, but access varies around the state. Lara aims to make health insurance available statewide, but has not yet announced exactly how the goal would be achieved. Neither a bill number nor a cost estimate were available Friday.

Health advocacy groups have been pushing the message for the last year that undocumented immigrants should be able to participate in the federal health care plans. In last year's budget fight, they advocated unsuccessfully for funding for county-level insurance for the undocumented.

PHOTO: California Senate President Pro Temp Darrell Steinberg, D-Sacramento, speaks with Senator Ricardo Lara, D-Bell Gardens, in the Senate chambers on Monday, March 11, 2013. The Sacramento Bee/Hector Amezcua

Citing the need to restore fiscal responsibility to the Democratic-controlled Legislature, Republican Doug Haaland said Friday he plans to challenge Assemblyman Ken Cooley, D-Rancho Cordova, in the 8th Assembly District.

Haaland said his priorities include focusing on job creation in the district and helping tamp down the Legislature's urge to spend an influx of revenue. The 61-year-old recently retired after spending nearly three decades working as an aide at the Capitol.

"After 27 years of working in the building, I know legislators get excited when they see the word 'surplus,'" Haaland said in an interview.

The Democratic supermajorities in both houses have not been productive, he added.

The 8th Assembly district stretches from Citrus Heights to south of Wilton, taking in Rancho Cordova, Rancho Murieta and Rosemont.

While it favors Democrats in voter registration, 41 percent to 36.5 percent, fewer than 15,000 votes separated Cooley from Republican Peter Tateishi with President Barack Obama running at the top of the ticket in 2012.

Haaland contemplated jumping into that race but ultimately decided against it. He held a number of jobs in state government including serving as the chief of staff to Assemblyman Phil Wyman and Assemblywoman Shirley Horton. He later spent several years as the director of member services for the Assembly Republican Caucus.

A resident of Arden Park, Haaland spent nearly a dozen years as president of the Rosemont Community Association.

Cooley also spent years as a legislative aide and has become well known for his guided tours of the Capitol.

"There is no doubt that it's going to be a bit of a mountain," Haaland said. "I will give Ken all the credit in the world for being good at the retail (politics) part of things."

PHOTO: Doug Haaland. Courtesy Haaland for Assembly.

A good newsmaker knows that when the governor's budget proposal leaks two days early, you move your event out of the way or risk getting buried in the ensuing media scrum.

So after teasing his run for Secretary of State in December, former Fair Political Practices Commission chair Dan Schnur formally launches his campaign today at 11 a.m. in the Hyatt Regency on L Street -- a day after originally scheduled.

Schnur, who now teaches politics at the University of Southern California, has focused his platform on banning fundraising by legislators and statewide officeholders while the Legislature is in session. Schnur argues that there is too much potential for donors to exert inappropriate influence on their votes.

The Secretary of State race could shape up to be one of the year's most interesting. Among Schnur's potential opponents are state Sens. Leland Yee, D-San Francisco, and Alex Padilla, D-Los Angeles, as well as Democrat Derek Cressman, a government watchdog, and Republican Pete Peterson, who heads an academic public policy institute

Though he has previously served as an adviser to major Republican figures like former Gov. Pete Wilson and U.S. Sen. John McCain, Schnur is registered with no party preference.

VIDEO: The budget leak is a political game between politicians and journalists, Dan Walters says.

WHO'S THE BOSS?: The president of California State University-Long Beach, the second largest of CSU's 23 campuses, left last summer to head up Louisiana State University, and the search continues for a replacement. The CSU Board of Trustees selection committee, which includes Assembly Speaker John A. Pérez, will meet today from 7 a.m. to 6 p.m.to determine which candidates move on to the next level of consideration.

MOVIN' ON UP: It seems that six-foot state Sen. Holly Mitchell, D-Los Angeles, doesn't do small. In September, the former assemblywoman jumped legislative houses after winning a special election, and she'll celebrate again this weekend with a swearing-in ceremony in her home district where Attorney General Kamala Harris will administer the oath. The festivities are scheduled for Saturday at noon in Culver City.

VROOM VROOM: Things may get noisy over the weekend as motorcyclists from across the state gather in Sacramento to voice support for their legislative agenda, including opposition to measures to ban "lane splitting." The Motorcycle Rider Unification Rally, hosted by motorcycle rights organization ABATE of California, takes place from noon to 2 p.m. on Saturday outside the State Capitol.

CELEBRATIONS: Happy birthday to Assemblyman Brian Nestande, R-Palm Desert, who turns 50 on Saturday.

PHOTO: Dan Schnur, shown in September 2010 when he was chair of the FPPC. The Sacramento Bee/Hector Amezcua

Politicians try to keep secrets and journalists try to figure out what they are, Dan says.

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PHOTO: California Governor Jerry Brown addresses members of the press about the State Budget for 2014-2015 at the Capitol in Sacramento on January 9, 2014. The Sacramento Bee/Randall Benton

The proposed rainy-day fund that is a central part of Gov. Jerry Brown's budget plan would scrap some of the provisions in a measure already on the November ballot.

That measure, ACA 4, was part of a 2010 budget deal between Democrats, Republicans and then-Gov. Arnold Schwarzenegger and was originally scheduled to go before voters in 2012. But lawmakers that year moved the initiative to 2014, and unions and some advocates for programs for low-income residents have voiced concerns that the proposed fund is too strict.

Speaking to reporters Thursday, Brown said the details of his proposed rainy-day fund remain to be worked out. But he said it would ease boom-and-bust budget cycles, while providing more flexibility than ACA 4.

"The reason for that rainy day fund is the volatility. With that zig-zag, up and down, in capital gains and spending, the only way to offset that is to have money in reserve, and that's what I intend to do," Brown said.

"The measure will be on the ballot, unless it's changed. And so I think that provides a lot of incentive to come up with some better alternatives," he added.

School and other budget interests reacted cautiously to the governor's proposed reserve.

"What's better, parking money or using it for one-time purposes?" said Dennis Meyers, assistant executive director for governmental relations of the California School Boards Association, one of the members of the influential Education Coalition that includes the California Teachers Association.

"There are just a lot of needs. You just have to weigh those needs versus softening the funding swings," Meyers said.

Replacing ACA 4 on the ballot with Brown's plan would require a two-thirds vote. Democrats have slim two-thirds majorities. Republicans, meanwhile, said they would oppose anything they deem weaker than ACA 4.

"We await details on the proposal announced today. However if it is stronger than Assembly Constitutional Amendment 4 — which will be on the ballot in November - then we'd be happy to take it under consideration," Assembly Republican Leader Connie Conway, R-Tulare, said in a statement.

Senate President Pro Tem Darrell Steinberg, D-Sacramento, who voted for ACA 4 to help end a three-month budget standoff, on Thursday called the measure "flawed, and flawed significantly."

"I think the governor's proposal will undoubtedly be better, but we have to analyze it," Steinberg said.

Under ACA 4, the state would divert money into a rainy-day reserve based on 20 years of historical revenue. The money would be off-limits except after earthquakes and other emergencies and when revenue comes in less than expenses for the previous year.

Brown's proposal includes three main differences from ACA 4:

• The proposed reserve would collect capital-gains revenue that exceeds 6.5 percent of the general fund.
• It would create a special pot within the reserve for the state's constitutional school-funding guarantee, Prop. 98. "Instead of immediately allocating it to schools, some of that money gets allocated into a reserve, so that when Prop. 98 drops...that money can get allocated from that account," the Department of Finance's Nick Schweizer said.
• Lastly, it would allow lawmakers to tap the fund to pay down state debts. "What we've done to date and what we want to continue to do is balance saving money for the future as well as chipping away at all of these huge liabilities," Finance Director Michael Cohen said.

PHOTO: Michael Cohen, director of the California Department of Finance, testifies to the Senate budget committee in 2011. The Sacramento Bee/Hector Amezcua

Lawmakers in California's Latino Caucus are pressuring the Department of Motor Vehicles to speed up its process for issuing driver's licenses to undocumented immigrants.

Assembly Bill 60, which Gov. Jerry Brown signed last year, allows immigrants who are in the United States illegally to obtain a California driver's license. It calls for the new licenses to be available by Jan. 1, 2015, or "an earlier date as determined by the Director of the DMV," says a statement the California Latino Legislative Caucus sent to the media today.

"In light of the urgent need for driver's licenses, we respectfully request that you expedite the development of regulations and commence accepting applications for licenses as soon as possible," says the letter from the Latino Caucus to Jean Shiomoto, DMV director.

"We understand that a program of this magnitude presents technical and staffing challenges as more than one million new individuals will be eligible for drivers's licenses. Nevertheless, with the support of community groups and local government s across the state we have full confidence that the Department of Motor Vehicles will be able to accelerate the process by several months," says the letter signed by Latino Caucus chairman Sen. Ricardo Lara and the two dozen state senators and assembly members who make up the group.

The 2014-15 budget proposal Brown released Thursday allocates $64.7 million for the DMV to set up the immigrant driver's license program, including costs for staff and temporary field offices.

PHOTO: The DMV office on La Mancha Way in Sacramento, shown in June 2007. The Sacramento Bee/ Randall Benton

Reporter David Siders shares the highlights of Gov. Jerry Brown's budget proposal.

It's time for some fun with numbers -- state budget numbers -- as found in the summary of Gov. Jerry Brown's proposed 2014-15 budget:

-- Brown's proposed budget for 2014-15 is about 15 times as large as the first one he managed for the 1975-76 fiscal year.

-- The governor pegs the total 2014-15 budget of the general fund, special funds and bond funds at $154.9 billion, but the real number is well over $200 billion, when federal funds are included. That's the equivalent of more than 10 percent of California's entire economic output.

-- Most of the federal money underwrites health and welfare services and K-12 education. The "health and human services" budget, for instance, is $118 billion, but the state's general fund would contribute only $28.8 billion of that total, with most of the rest coming from the feds.

-- Spending on elementary and high schools would top $76 billion, with $45.3 billion from the general fund, another $16 billion from local property taxes and the final $15 billion mostly from the federal government. That translates into $12,833 for each of the state's six million K-12 students.

-- During the 2007-8 fiscal year, the state pumped $3.3 billion of general fund money into the University of California's $12 billion general purpose spending, but during 2014-15, the state's contribution would be $2.8 billion while revenue from tuition and student fees would have climbed from $6.6 billion in 2007-08 to $12.2 billion in 2014-15.

-- During that same period, the state's share of running the state university and college system would shrink less dramatically, from $3 billion to $2.5 billion while student fees would increase from $2.8 billion to $5.5 billion.

-- Although the state's prison population has dropped by about 30,000 inmates in recent years, thanks to pressure from federal judges about overcrowding, the state's spending on "corrections and rehabilitation" hasn't shrunk and, in fact, appears to have grown.

The 2014-15 budget pegs corrections at just under $12 billion, including sales taxes that the state gives counties to handle felons that have been diverted into local jails and supervision under "realignment." Spending on inmate health and dental care alone - another source of federal judicial pressure - has risen from an average of $7,580 per inmate in 2005-06 to a projected $18,415 in 2014-15.

-- During Brown's first stint as governor nearly four decades ago, the sales tax was the No. 1 generator of general fund revenues at 41 percent in 1975-76, with income taxes trailing at 34 percent. The 2014-15 budget projects income taxes to be almost 66 percent of the state's revenues and sales taxes just 23 percent.

--The proposed budget, if enacted, would spend the equivalent of 8.17 percent of Californians' personal incomes, by no means the highest level, but also not the lowest, since 1950, according to a chart in the budget.

The highest relative level of spending, 8.83 percent, occurred during the 1980-81 fiscal year, when Brown was serving his first stint as governor, and again in 2007-08 during Arnold Schwarzenegger's governorship. The lowest level, 4.62 percent, occurred in 1951-52, when Earl Warren was governor. Since 1975, the lowest has been 7.28 percent in 1983-84. the first budget for then-Gov. George Deukmejian.

Updated at 2:30 p.m. to include more historic data.

PHOTO: Gov. Jerry Brown presents his proposed budget at the state Capitol on Jan. 9, 2014. The Sacramento Bee/Alexei Koseff

Calling his high-speed rail project consistent with California's history as "a generator of dreams and great initiatives," Gov. Jerry Brown on Thursday defended his decision to shore up the project's shaky finances with money from the state's cap-and-trade fund.

"The alternative would be not to spend the money, and you do need that money, and we're going to spend it," Brown said. "No one's talking about the Marshall Plan or putting a man on the moon or the transcontinental railroad," he added.

Legal challenges have beset the project, throwing into question the fate of billions in voter-approved bond money. But the cap-and-trade money Brown proposes to use would not face any spending restrictions, according to a spokesman for the California State Transportation Agency.

With California's market for carbon-emissions permits generating hundreds of millions of dollars, Brown has proposed diverting some of the proceeds to high-speed rail. His budget calls for a combined $300 million to be spent on high-speed rail and on the California Department of Transportation.

The plan has been buffeted from all sides. Environmentalists wonder if it is an appropriate use of money set aside to cut California's overall carbon emissions level, while critics of high-speed rail see Brown attempting to prop up an expensive boondoggle.

Brown called the move an effective way to reduce emissions by investing in transportation infrastructure, saying California's already overburdened roadways will not be able to accommodate projected population growth.

"The high-speed rail is a reducer of greenhouse gases, an enhancement of the quality of California life and a bringing together of our various" communities around the state, Brown said. Given expectations that the state's population will grow by millions of residents, he said, "we need alternatives."

A Sacramento Superior Court judge cast serious doubt on the $68 billion bullet train's financial underpinnings in November, ordering the state to withdraw its original funding plan and declining to authorize an $8 billion bond sale.

At the same time, Judge Michael P. Kenny did not halt the state's plan to spend $3.4 billion in federal money on an initial segment in the Central Valley.

Opponents of high-speed rail have trumpeted the rulings as a decisive blow, while officials with the California Department of Transportation have said the project will proceed.

PHOTO: A view of a high speed train moving through a wind farm in the proposed high speed rail network. Rendering by Newlands and Company Inc.

By Diana Lambert
dlambert@sacbee.com

As California begins to see budget surpluses in the wake of a 2012 statewide tax increase, state schools chief Tom Torlakson is already calling for an extension of Proposition 30 beyond its full expiration in 2018.

The initiative imposed an income tax increase on the state's highest earners through 2018 and a sales tax hike by a quarter-cent on the dollar through 2016.

"We need to renew Prop. 30," Torlakson, the state Superintendent of Public Instruction, said Wednesday night at a coffee meeting with local PTA leaders in a Sacramento home.

The tax initiative, along with a robust stock market and strong technology sector, has generated stronger revenues than state leaders anticipated. Under the state constitution, a significant share of those dollars must go toward K-12 schools, which suffered deep cuts during the recession.

Torlakson's remarks came just as reporters obtained Brown's budget proposal, which calls for spending $6.3 billion more on K-12 schools and community colleges in 2014-15 beyond what had been dedicated for this school year. Much of that new money will go toward low-income students and English-language learners.

The governor also wants to use $6.4 billion to reverse past accounting maneuvers that forced districts to borrow or cut spending.

Brown has proposed giving California State University and University of California a 4.2 percent bump, though the two systems are seeking a 10 percent increase.

Photo: Tom Torlakson, California Superintendent of Public Instruction, meets with parents to talk about Common Core Standards and concerns in education on Wednesday night, January 8, 2014 in South Land Park. The Sacramento Bee/Jose Luis Villegas

California budgets became a thicket of funding shifts, loans and other fiscal maneuvers after the recession gutted the state's tax revenue. Overall, though, state spending would be up 12 percent from pre-recession levels under Gov. Jerry Brown's proposed budget.

This week's plan includes about $154.9 billion in total spending in 2014-15, which reflects expenditures paid by the general fund ($106.8 billion), special funds (almost $44 billion) and bond money ($4.2 billion.)

In the 2007-08 plan passed by lawmakers before the recession hit, total spending was about $138 billion — $103 billion general fund, $26.7 billion special funds, and $8.4 billion bond funds.

The chart below shows total spending by fiscal year since 2007-08, with sharp drops during the deepest part of the recession.

Source: California budget summaries

PHOTO: Gov. Jerry Brown speaks at a news conference at the Capitol on Jan. 10, 2013. The Sacramento Bee/Randall Benton

The news media rejoiced when digital copies of Gov. Jerry Brown's proposed spending plan leaked Wednesday afternoon, pushing up the governor's presentation by 24 hours.

The Sacramento Bee obtained a copy and offered this early post.

Not everyone was convenienced by the circumstances. Brown's press shop scrambled to reschedule events in Sacramento, San Diego and Los Angeles. And Michael Cohen, Brown's new finance director, was hit with some unexpected news.

Cohen's parents had booked a flight for Thursday, and couldn't move it back a day to see their son preside over his first state budget as the governor's chief fiscal policy adviser.

Cohen was appointed to the job in September, taking over for Ana Matosantos.

Brown's spokesman, Evan Westrup, had this to say about the leak: "I think it speaks for itself but regardless we're ready to roll."

As for where the leak came from?

"That's a good question," he said. "If you find out let us know."

PHOTO: Finance Director Michael Cohen testifies before the Senate budget committee at the Capitol on Jan. 13, 2011. The Sacramento Bee/Hector Amezcua

The state Board of Education appears to be playing King Solomon — splitting the baby — as it contends with competing demands on how to implement the state's new program of giving extra money to school districts with large numbers of poor and/or English-learner students.

With billions of dollars at stake in the "Local Control Funding Formula" championed by Gov. Jerry Brown, civil rights groups and other advocates for poor children denounced the original version of regulations as being too loose, while school officials tended to praise them for the "flexibility" they sought.

The board, its staff and its consultants digested the criticism and have released a revised version of the rules, which will be discussed and perhaps approved at a Jan. 16 school board meeting.

The board's agenda for the meeting includes not only the revised rules themselves but
a chart that explains the revisions and how they responded to the criticism.

Overall, they appear to tighten up the rules for spending the extra money, but don't go as far as the critics - who included the Legislature's leadership - had wanted. The biggest change is providing more specificity and detail on how districts calculate the extra services they must provide to the targeted kids. But the new rules do not, as the critical groups sought, require that the extra money be spent exclusively on those students.

Brown, citing the principle of "subsidiarity," has called for giving districts as much flexibility as possible, but critics say that leaving the extra spending to the districts could result in its being diverted into other purposes.

Overall, about 60 percent of the state's six million K-2 students are classified as poor because of their qualification for free or reduced-price school meals and/or English-learners.

Meanwhile, EdSource, a website that intensively covers California education, has published a complete guide to the new program and how it would work.

PHOTO: California Board of Education president Michael Kirst in November 2013. The Sacramento Bee/Hector Amezcua

Gov. Jerry Brown on Thursday rejected calls for a tax on companies that extract oil in California, after billionaire environmentalist Tom Steyer said last month that he would ramp up a campaign for such a tax in the state Legislature.

"I don't think this is the year for new taxes," the Democratic governor told reporters at the state Capitol.

Brown, who is preparing for a likely re-election bid this year, spent much of 2012 campaigning for his ballot initiative to raise taxes, Proposition 30, and its passage is a major reason he is enjoying a budget surplus this year.

"I went up and down the state campaigning for Proposition 30," Brown told reporters after unveiling his annual budget plan. "I said it was temporary. It is going to be temporary. And I just think we want to do everything we can to live within our means before going back again and trying to get more taxes."

Previous efforts to enact an oil severance tax have failed in the Legislature. Steyer, a former hedge fund manager and major Democratic donor, has said prospects may be improving in the heavily Democratic Senate and Assembly.

Steyer has declined to say whether he will seek an initiative to qualify for the ballot if efforts at the Capitol fail.

PHOTO: Gov. Jerry Brown speaks about his budget proposal at a news conference at the Capitol on January 9, 2014. The Sacramento Bee/Alexei Koseff

Gov. Jerry Brown said he is closely monitoring the state's worsening drought, but suggested that a drought emergency declaration was not imminent.

"Governors can't make it rain," Brown told reporters as he presented his proposed 2014-15 budget. He pointed to a state water task force working on the issue, which is meeting today.

But Brown downplayed any expectations that his office can do much to alleviate the dry conditions, which already have caused some agencies to cut dam releases and seek reductions in home water use.

"We'll take whatever steps we can, in collaboration with the state's farmers...and also the urban people have to do their part," Brown said.

"But don't think paper from the governor's office is going to affect the rain. We are doing what we can do in terms of water exchanges and we'll do other things as we get down the road.

"That seems to be probably enough, from my point of view," Brown added.

PHOTO: John Timon and Kent Smith of Oroville cross paths as they walk opposite direction on the Oroville Dam in 2009. Oroville is the state's second-largest reservoir and the largest in the State Water Project. The Sacramento Bee/Jose Luis Villegas

Here are some reactions to Gov. Jerry Brown's budget proposal.

Assembly Speaker John A. Perez:

Assembly Democrats want to maintain stability and expand opportunity. There is much in the Governor's budget proposal that supports those goals. I'm pleased to see so many areas of agreement between the Governor and the Assembly, particularly how strongly he has embraced the rainy day fund that is the cornerstone of the Assembly's proposal.

With a strong rainy day fund in place we can avoid mistakes of the past and ensure that education and other vital services in California are protected from the volatility of boom and bust cycles.

I am pleased that the Governor proposes to continue paying down the wall of debt. This proposal completely pays off California's economic recovery bond debt from 2005, and repays our schools six billion dollars in funds that were deferred during the worst years of the Recession.

This proposal makes smart investments in strengthening our economic recovery, especially with respect to our shared commitment to infrastructure.

The Assembly will work with the Governor and the Senate to finalize another on-time balanced budget. Having agreement on such a major component as the rainy day fund makes that job easier."

Assembly Republican Leader Connie Conway, R-Tulare.

While the budget is out sooner than the Governor planned, it gives us more time to review the fine print. I hope that Gov. Brown is successful in convincing his fellow Democrats to resist the urge to spend away any fiscal progress the state has made. We've been down this road before and I'd strongly caution my legislative friends across the aisle from traveling it again. In the not-so-distant past, California has seen unexpected revenue spikes that have evaporated overnight - quickly turning modest surpluses into enormous deficits.

"Now is the time to tackle the wall of debt, avoid the budget mistakes of the past and invest in our future so that our economy grows. The Governor sounds receptive to those ideas and Assembly Republicans stand ready to work in good faith to achieve those goals.

Senate President Pro Tem Darrell Steinberg, D-Sacramento

"After years of struggle to erase the state's deficit, we all agree that it's imperative to use much of our increased revenues to pump up the rainy day fund and to eliminate the debt from loans, bonds and delayed payments to our schools. I appreciate the Governor's aggressive approach to more than double the reserve and pay down debt even more quickly than we had hoped.

"At the same time, we must invest in the people of California, especially those living in the economic margins. I've proposed and remain committed to a balanced framework of 'a third, a third, a third,' where we divide the surplus into reserves, repayment and reinvestment.

"We are pleased that the budget includes last year's Senate Democratic proposal to invest in substance abuse treatment, mental health and re-entry programs for criminal offenders who serve their time, saving more money by slowing the revolving door in our jails and prisons. I support the Governor's request for a two year delay in the federal court's prison population order. The court must approve this request.

"Such smart reinvestment pays dividends down the road and is just as important to fiscal stability as the long term strategy of excising our debt and saving for the future. Similarly, expanding transitional kindergarten can be accomplished with just a fraction of increased Prop 98 funds while saving billions of dollars in the long run by reducing the extra costs of special education, grade retention and juvenile crime.

"The Legislature will now accelerate its work in the five-month budget process through public hearings to closely examine the Governor's proposals. I look forward to working with my colleagues, the Administration and the Assembly to achieve our common goal - developing a sound fiscal roadmap to meet the needs of all Californians."

Sens. Bob Huff, R-Diamond Bar, and Jim Nielsen, R-Gerber

"Generally speaking we're pleased to see our schools benefit, but the rainy day reserve needs to be more robust, and the ACA 4 proposal supported by Democrats and Republicans is a better starting point," Senator Huff said. "The Governor wisely identified the need to pay down debt in this budget, but there's more that needs to be done. As he notes, there is a $355 billion mountain of debt that isn't going away. His High Speed Rail proposal is a non-starter. Even if his idea to take money from the Cap & Trade fund is legal - which we don't believe it is -businesses throughout the state will be forced to pay for it. That means higher gas costs and fewer jobs for middle class families. Too many people, too many families, are still hurting and looking for work. We need to help California workers find jobs.

The big question is, can the Governor hold strong against the spending demands made by his fellow Democrats," Senator Huff added. "Judging by the way they want to spend money, you'd think California was booming. Sadly, that's not the case. Our unemployment rate is still among the highest in the country and that's not acceptable. Ramping up state spending before making sure we're on solid fiscal ground is a recipe for disaster. What's the good of building up programs only to tear them down in a couple of years? We've seen this movie before, and it doesn't have a happy ending."

Senator Nielsen added, "I appreciate that the Governor is advocating fiscal restraint. This budget proposal, however, doesn't adequately address the structural deficit that continues to plague the state treasury. It also continues to fund the Governor's 'dream' of the High Speed Rail that California taxpayers don't want and can't afford.

California's budget problems have not been erased by the financial windfall created by recent tax increases. We have a $350 billion 'wall of debt' that must be paid down so our economy can grow. Our state's economy is not recovering like the rest of the country. We must address the need to create more jobs for Californians who want to work."

Michele Stillwell-Parvensky of Children's Defense Fund-California

"Governor Brown's initial budget proposal once again fails to recognize the dire need to repair a social safety net that was shredded during five years of budget cuts to critical programs. While the Governor's continued investment in K-12 education is a positive step, children also need health care, quality child care and pre-k, and family supports to survive and flourish.
"We understand the wisdom of preparing for the future; however, it is irresponsible to allocate billions to pay down state debt and build a rainy day fund when one in four California children live in poverty. It has been pouring for California's most vulnerable children and families for years - and now the state has the resources to protect our children and our future by investing in programs that will help create a level playing field for all children.
"The need for re-investing on the state level is made even more pressing by the devastating cuts to federal social safety net programs like food assistance and unemployment benefits, upon which so many Californians rely to support their families.
"Our continued prosperity depends on all of our citizens having a chance to thrive and succeed. On the 50th Anniversary of the War on Poverty, we urge our state lawmakers to use our good fiscal health to restore and strengthen the safety net programs that protect and support our most vulnerable children and families as they find their way out of poverty and into economic security."

Noting billions of dollars in unpaid bills the state has for pensions, schools and health care, Gov. Jerry Brown today touted what he called a "very measured" election year budget proposal despite a state surplus.

"We've got lots of long-term liabilities," Brown said. "It isn't time to just embark on a whole raft of new initiatives, and that's the problem."

Brown is proposing a $154.9 billion spending plan from all funds, about a 5 percent increase over the current year. It increases spending on schools and social service programs and dedicates $11 billion to pay down part of what Brown calls a "wall of debt."

But Brown said the surplus is based on a volatile source of income - capital gains taxes from stock market gains -- and urged caution.

"We've tried to keep it very measured," he said.

Brown highlighted the need for a rainy-day fund, but offered few details about how it would differ from a measure approved by the Legislature in 2010 that is already on the November ballot. Unions and other groups have said the proposal is too restrictive.

"I think that provides a lot of incentive to come up with some better alternatives," Brown said, adding that he wants to work with legislative leaders on a rainy-day account that is "more flexible and workable."

"The difficulty in drawing one is you don't know what the world is going to look like in a few years," he added.

Advocates for the poor have decried years of flat benefits and cuts to social programs and healthcare, and repeatedly called for spending increases as the state's fiscal outlook improves.

Brown downplayed those concerns. "We can always do more," he said, but California stacks up well against other states.

Brown also came out against a proposed oil-severance tax championed by some environmental activists. "I don't think this is the year for new taxes," he said.

PHOTO: Gov. Jerry Brown speaks about his budget proposal at a news conference at the Capitol on January 9, 2014. The Sacramento Bee/Alexei Koseff

In what has become an unlucky pattern for Gov. Jerry Brown, his budget proposal leaked early last night. It is the second time in three years this has happened. In 2012, the governor's proposal was inadvertently posted to the Department of Finance website before it was formally introduced.

Among Gov. Brown's priorities for the 2014-15 fiscal year are repaying about $6 billion in deferred school payments and creating a rainy day fund. (You can check out the entire document here.)

News conferences across the state, originally planned for Friday, have now been moved up a day: After introducing his budget at the Capitol at 9 a.m., Gov. Brown will be at the San Diego City Administration Building at 12:30 p.m. and the Ronald Reagan State Building in Los Angeles at 3:00 p.m. for additional announcements.

VIDEO: The Legislature continues to act irresponsibly by ignoring California's growing pension debts, Dan Walters says.

LEFT OUT: A new report from the National Fair Housing Alliance, a Washington, D.C.-based organization that advocates for equal housing opportunity, charges that rental companies routinely discriminate against applicants who are deaf or hard of hearing. The group is planning to file federal civil rights complaints today against major apartment owners and managers in eight cities nationwide, including Sacramento. The details will be announced during an online news conference at 10 a.m.

EDUCATION INNOVATION: Among the more than 2 million students served by California's community college system, nearly three-quarters require some basic skills coursework in English or math, according to the Campaign for College Opportunity. Most of them won't finish their education as a result -- a situation the group believes can be improved by encouraging more innovation in how those basic skills are taught. Representatives from several community colleges share their experiences during a briefing at 2 p.m. in Room 126 of the Capitol building.

DIGITAL TRAIL: Assembly members Ed Chau, D-Monterey Park, who chairs the select committee on privacy, and Bonnie Loewenthal, D-Long Beach, will host a screening of the documentary Terms and Conditions May Apply at 11:30 a.m. in Room 127 of the Capitol building. The film concerns digital privacy and will be followed by a question-and-answer session with Matthew Cagle, an attorney with the American Civil Liberties Union of Northern California.

PHOTO: Gov. Jerry Brown speaks at the California Chamber of Commerce's annual Host Breakfast in Sacramento on May 22, 2013. The Associated Press/Rich Pedroncelli

Creating new programs instead of dealing with unfunded liabilities is like skipping a house payment to buy a sports car, Dan says.

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Buried about a third of the way through Gov. Jerry Brown's leaked budget proposal is a hint of the next twist in a protracted dispute over California's prison population.

California is staring down a federal court order to reduce its prison population and is at work negotiating a solution. The court recently granted California an extension, from mid-January to mid-April of 2014, as it seeks to slip under a population cap.

The imperative to depopulate prisons led Brown to ask the Legislature last year for $315 million to spend on housing inmates.

But California will spend only $228 million of that in the current fiscal year, the new budget blueprint predicts. The reason for not needing to spend it all?

"The Administration has assumed the court will grant a two-year extension to meet the cap," the budget document states.

If true, that would buy Brown a substantial amount of breathing room as he seeks to mollify federal judges. If not, the budget proposal states, California will need to spend the full $315 million.

Lawmakers reluctant to back the governor's focus on expanding capacity, most prominently Senate President Pro Tem Darrell Steinberg, have emphasized instead spending more money fighting recidivism and promoting rehabilitation.

Brown's proposal would spend $11.8 million on substance abuse treatment and $11.3 million on mentally ill parolees while directing $40 million from the state's Recidivism Reduction Fund to re-entry programs.

That's not to say Brown is done pouring money into incarceration capacity. Despite spending $1.7 billion in jail construction, the administration argues there remains a significant need to house offenders. To that end, Brown proposes another $500 million for more facilities with a 10 percent county match requirement.

In his plan, which builds on Assembly Bill 109 of 2011, Brown also proposes legislation to require county jail felony sentences to be split between incarceration and mandatory supervision, unless the court finds it in the interests of justice not to do so.

PHOTO: Guard tower looks over the yard at San Quentin State Prison on Wednesday September 18, 2013 in San Rafael, Calif. The Sacramento Bee/Paul Kitagaki Jr.

Here is Brown's budget proposal:

2014 Budget Summary

Gov. Jerry Brown will propose reducing the state's long-term debt by more than $11 billion next budget year and fully eliminating it by 2017-18, according to a copy of the budget document obtained by The Sacramento Bee.

He also will propose repaying about $6 billion in deferred payments to schools and contributing $1.6 billion to a rainy day fund.

Brown wants to restore some of the money cut from social service programs in recent years, and will propose a 5 percent increase in welfare grants.

The Democratic governor, who was scheduled to propose the budget plan Friday, shifted course after the document's leak, announcing he will introduce the proposal on Thursday, instead.

In the budget document, Brown calls for "fiscal restraint," saying "economic expansions do not last forever."

The budget projects $217.8 billion in unfunded retirement mandate and total state unfunded liabilities of $354 billion.

The budget calls for spending $154.9 billion from all funds, including $106.8 billion from the General Fund.

The plan's summary projects that spending on K-12 schools will grow to almost $70 billion by 2017-18, an increase of $22 billion from 2011-12.

The summary makes no mention of transitional kindergarten, something championed by Democrats in both the Assembly and Senate in recent days.

Brown proposes $670 million in new general fund spending to pay for the expansion of Medi-Cal benefits, including mental health, substance use disorder, adult dental and specialized nutrition services.

Several health-related programs would receive funding boosts. In-home supportive services, which saw dramatic reductions over recent years, will get a 6.4 percent increase over the current budget, bringing its general fund allotment to about $2 billion. Part of the increase stems from U.S. Department of Labor regulations that take effect Jan. 1, 2015 and require overtime pay for domestic workers.

Brown's budget proposal assumes that the state's finances will be sound enough to include $173.1 million for state employee pay increases to kick in July 1, although it doesn't firmly commit to it. About half that money will come from the general fund.

"A final determination will be made at the May Revision based on the latest revenue projections and updated expenditure information available," according to the draft document.

State managers and supervisors will receive similar pay hikes to avoid salary compaction, which occurs when rank-and-file wages exceed management's.

Brown's budget summary doesn't commit 2014-15 money to the struggling state teachers' retirement fund. Instead, "the Administration will begin working with the Legislature, school districts, teachers and the pension system," aiming to enact a plan in 2015-16 that will fully fund the system within 30 years.

Current obligations to CalSTRS' current and future retirees total $80.4 billion more than it has assets to cover. Stabilizing the system would require more than $4.5 billion per year for many years.

Unlike like other public pension systems, the California Teachers' Retirement System doesn't have the authority to charge employers more money to make up for investment losses. The Legislature has the power to raise employer rates or kick in money from state coffers.

Brown's summary suggests whatever plan emerges should phase in contribution increases over time and cautions that "school districts and community colleges should
anticipate absorbing much of any new CalSTRS funding requirement."

Lawmakers have advanced the notion of safeguarding extra revenue in a rainy day fund, including placing a measure on the 2014 ballot to fortify the state's fund.

Saying that proposed measure does not go far enough, the budget proposes an alternate constitutional amendment that would regulate the flow of money into and out of the state's budget reserve.

Deposits into the fund would be tied to revenue from capital gains, triggering when such revenue accounts for more than 6.5 percent of the General Fund. Brown and others have warned about becoming overly reliant volatile sources of income like capital gains, and the proposal notes that California's heavy use on taxes on the wealthy means revenue can "swing both up and down quickly."

Payments to schools under Proposition 98, the voter-approved constitutional amendment setting a minimum baseline of education spending, would be managed through a reserve that would absorb funding bumps to be used in down years.

The fund's maximum size would also double, from five to ten percent of the General Fund. Safeguarding against depleting the fund too quickly during future downturns, the amendment would allow at most half of the fund's balance to be spent in the first year of a recession.

Under the proposed amendment, California could fulfill its obligation to deposit money into the fund by allocating money to pay down the so-called Wall of Debt.

For schools, the plan proposes $61.6 billion toward the constitutional school-funding guarantee in 2014-15, up from $6.3 billion above the current budget year.

The plan also includes a $6.4 billion payoff of school deferrals. Those involuntary loans from school districts to the state forced districts to borrow billions of dollars with interest from private lenders or else absorb the cost from reserves or cutting programs.

With school-construction bonds from 2002, 2004 and 2006 all but exhausted, Brown wants to revisit what role, if any, the state should play in helping districts build new schools or modernize existing classrooms.

Any future school-construction programs, the plan reads, should "avoid an unsustainable reliance on state debt issuance that characterizes the current school facilities program."

The budget, though, taps $188 million from the general fund for emergency school repairs.

To help carry out the first year of the Brown-championed Local Control Funding Formula, the budget increases general fund money for schools by $4.5 billion in 2014-15.

In addition, the plan would allocate $26.3 billion for higher education and repeats calls for major changes in how the system operates.

Instead of focusing on enrollment targets that increase costs, the University of California, California State University and community college systems need to do a better job ensuring that students complete their degrees in a timely manner, according to the budget summary.

The budget includes a funding increase of $142.2 million apiece for the UC and CSU systems. The increases reflect the second year of a four-year pact with the administration that trades more money for the systems' holding tuition at existing levels and making changes meant to "improve student success and to realize institutional efficiencies."

State funding for community colleges, meanwhile, would increase 11.4 percent in 2014-15.

Editor's note: This post was updated at 5:20 p.m., 5:37 p.m. and 5:46 p.m. to include additional information about the budget. It was changed at 11:40 on Jan. 9 to clarify that the proposed increase in K-12 spending to nearly $70 billion would occur by the 2017-18 fiscal year.

Jim Miller, Jeremy White, Christopher Cadelago and Jon Ortiz of The Bee Capitol Bureau contributed to this report.

California's political watchdog agency is investigating whether money laundering took place during Assemblyman Roger Hernandez's 2010 campaign and is fighting with his lawyer to get access to bank records, according to a filing this week in Los Angeles Superior Court.

The document says the Fair Political Practices Commission subpoenaed Hernadez's lawyer, Aldo A. Flores, for information about a $3,900 contribution he made to the assemblyman's campaign in 2009. The matter landed in court this fall when Flores challenged the FPPC's requests for his bank records.

"Evidence from the bank records may show (Flores) was reimbursed for his payment to the Hernandez for Assembly 2010 campaign committee," says the FPPC's filing that asks the court to uphold the subpoenas that are part of a "larger investigation."

"The FPPC is actively investigating political money laundering," the filing says, adding that "evidence uncovered thus far provides sufficient grounds to support the subpoenas."

State law limits the amount donors can give to candidates. The limit for contributions to legislative candidates is $4,100 now but was $3,900 in 2009, when Flores made the donation to Hernandez, a Democrat from West Covina.

Hiding the identity of a donor by passing the money through someone else amounts to political money laundering and violates state law.

"Making a contribution in another person's name is one of the most serious types of violations of the (Political Reform) Act, because it denies the public of information about where a candidate receives his or her financial support," the FPPC's filing says.

Hernandez issued a statement late Wednesday, suggesting the FPPC's case is "about one very old fact" and that "the FPPC has no information that the check was improper...This blanket attack is nothing more than an attempt to tarnish my name by powerful interest groups that see me as a threat for the work that I am doing on behalf of hard-working Californians."

The agency said last year that it was investigating two complaints against Hernandez. One questions a $100,000 loan he made to his campaign in 2009. The other alleges that spending on some campaign fliers in West Covina was not properly reported. Those investigations remain open, said Gary Winuk, the FPPC's chief of enforcement.

Messages The Sacramento Bee left for Flores have not been returned.

A hearing is scheduled for January 16.

PHOTO: Assemblyman Roger Hernandez at the California State Capitol in Sacramento in January 2013. The Sacramento Bee/Randall Benton

Editor's Note: This post was updated at 6:30 p.m. Jan. 8, 2014 to include Hernandez's statement.

California's first-in-the-nation carbon auction market had a promising inaugural year, according to a report by the Environmental Defense Fund.

The centerpiece of a 2006 law aimed at curtailing greenhouse gas emissions to 1990 levels by 2020, the cap-and-trade program allows industry to purchase carbon allowances. The "cap" refers to an overall ceiling on emissions, with companies able to obtain a finite number of permits that together fall below that limit. The ceiling will lower over time.

Over the course of five auctions, California sold 142 different entities the total available stock of allowances for 2013 - some 117 million, the report found. That added up to a $1.37 billion surge of revenue.

Power suppliers accounted for nearly half of the purchases, the report found, while the oil industry combined with food and agriculture to vacuum up another quarter of the allowances.

By law, that money must be spent in ways that reduce emissions. It promises to be a politically fraught process, illustrated by Gov. Jerry Brown's plan to use a chunk of the proceeds to pay for his troubled high-speed rail project.

A recent projection from Lawrence Berkeley National Laboratory found that California is on pace to thin the air to 1990 levels by 2020. Hitting a separate, more stringent target set out in a 2005 executive order issued by Gov. Arnold Schwarzenegger remains a challenge.

PHOTO: Union oil company refinery in Rodeo, Tuesday, December 17, 2002. The Sacramento Bee/ Michael A. Jones.

California's health insurance exchange needs a new home.

And officials with Covered California, headquartered at 560 J Street in Sacramento, are on the hunt, a spokesman confirmed Wednesday.

That's because its offices at Downtown Plaza are sitting on some important real estate: the presumed future home of the Sacramento Kings.

City and team officials have been working to clear the way for an arena. Last night, the Sacramento City Council moved to file eminent domain proceedings against a group that owns the former Macy's furniture and men's store in the mall.

Roy Kennedy, a spokesman for Covered California, said the exchange's facilities management team is in the process of securing a long-term location.

"The hope is Covered California will have a permanent home soon somewhere in the greater Sacramento area," Kennedy said.

The exchange, which began taking enrollments in October, also operates a trio of service centers in Rancho Cordova and in Contra Costa and Fresno counties.

PHOTO: Sacramento Mayor Kevin Johnson talks with Alice Huffman, president and chief executive of California NAACP before a Covered California press conference at Sacramento City Hall in October. The Sacramento Bee/Hector Amezcua

At the launch of the 2014 legislative year, the state Assembly is making history: For the first time in well over a century, a majority of members are freshmen.

Three new members took the oath of office on Monday with little fanfare beyond some applause from their legislative colleagues. But the pageantry obscured a milestone, with a majority of lawmakers on the 80-member Assembly floor serving their first terms.

This is the first time since the 19th century more than 40 Assembly members have been on their first go-around, according to Chief Clerk of the Assembly E. Dotson Wilson.

The 2012 election cycle was not momentous just for propelling Democrats to a two-thirds supermajority. It also inaugurated one of the largest freshman classes in history, with 38 of those neophytes taking Assembly seats.

Their ranks grew as 2013 progressed, with Assemblywoman Lorena Gonzalez, D-San Diego, scooping up the seat Ben Hueso left as he graduated to the Senate.

Add to that new members Sebastian Ridley-Thomas of Los Angeles, Matt Dababneh of Sherman Oaks and Freddie Rodriguez of Pomona, all three elevated by special elections during the latter part of 2013.

With the addition of that trio, 42 of the Assembly members casting votes and submitting bills this year will have taken their desks since the start of the 2013-14 session.

The influx of newcomers could play a role in the leadership transition set to occur some time this session, with Assembly Speaker John A. Pérez, D-Los Angeles, termed out at the end of the year. The names of a few freshman members recur during the who-will-be-next guessing game, reflecting a push to award the next speakership to a member entitled to a full twelve years in the lower house.

PHOTO: Newly sworn-in Assemblyman Matthew Dababneh joins other Assembly members in the pledge of allegiance during the first session of the California Assembly on Monday, Jan. 6, 2014. The Sacramento Bee/Hector Amezcua.

Activists seeking to repeal a law that aims to protect transgender students will have to wait until next month to learn if their effort qualifies for the statewide ballot.

Secretary of State Debra Bowen said Wednesday that the referendum of Assembly Bill 1266 will move to a full count of signatures due by Feb. 24. Bowen's announcement comes after county election officials determined the repeal did not have enough valid signatures to qualify by random sample.

The full count was triggered by about 3,000 signatures. It would have needed more than 72,000 additional valid signatures to avoid another count and qualify for the ballot outright.

Privacy for All Students, the proponents of the referendum, argue the law signed by Gov. Jerry Brown last year would make students uncomfortable and infringe on the will of parents. They described their efforts as centering on safety and privacy. The campaign is managed by Frank Schubert, who helped lead the Yes on Proposition 8 campaign.

The new law allows transgender students in public schools to join athletic teams and access facilities such as bathrooms that correspond with their gender identities. Authored by Assemblyman Tom Ammiano, D-San Francisco, it was held up by supporters as a needed protection for students who suffer humiliation and bullying.

PHOTO: Frank Schubert, adviser for effort to repeal a transgender rights law, was campaign manager for the Yes on Proposition 8 campaign. He is shown here at a news conference at the Riverside Wesleyan Church in Sacramento, CA, Monday Oct. 20, 2008. The Sacramento Bee/Brian Baer

Since going into effect a week ago, Colorado's legalization of marijuana has been a smoking success in at least one sense: recreational pot shops have seen extremely high demand, with hour-long lines on opening day and supplies already running low.

Could this be a preview of what's to come in California? A Field Poll last month revealed that, for the first time, a majority of voters in the state support legalizing marijuana. And with possible ballot measures collecting signatures, that question could be put to the test as soon as this November.

Sacramento Bee reporter Peter Hecht—who has covered pot issues in California extensively and has written the upcoming book Weed Land—will offer his thoughts during a live chat today at 11:30 a.m. Readers can join in with questions and comments at www.sacbee.com/live.

VIDEO: The legislative leadership broke with budget tradition in a big way this year, Dan Walters says.

HELPING HAND: After shelving the legislation last spring, state Sen. Joel Anderson has revived his bill that seeks to prevent the state from taxing income lost to criminal fraud such as Ponzi schemes. The Alpine Republican will be in Room 113 of the Capitol at 9 a.m. to discuss the proposal before heading across the hall for a hearing of the Senate Governance and Finance Committee, which is scheduled to consider the measure. Anderson will be joined by state Sen. Mark Wyland, R-Solana Beach, and victims of investment fraud.

MAKING THE GRADE: A new scorecard from the California Food Policy Council, which advocates for healthy food and sustainable agriculture, focuses on the Legislature's action on food- and farm-related issues in 2013. The report will be released following a press conference on the north steps of the Capitol at 11 a.m., where representatives from the organization will be joined by Assemblyman Roger Dickinson, D-Sacramento.

PHOTO: Marijuana plants at an illegal grow site off Interstate 5 and the Twin Cities exit on August 30, 2013. The Sacramento Bee/Manny Crisostomo

Announcing their budget priorities before Gov. Jerry Brown presents his 2014-2015 budget was an unorthodox--and highly political--move by state Senate President Pro Tem Darrell Steinberg and Assembly Speaker John A. Pérez, Dan says.

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California income tax collections came in $1.6 billion, or 20 percent, above projections in December, the Legislative Analyst's Office said Tuesday, just days before the Brown administration releases its annual spending plan.

December is a significant month for personal income tax payments by California's wealthiest taxpayers. Including that month, the nonpartisan analyst's office said revenue from personal income and corporation taxes were running $2.1 billion above projections so far this budget year.

Gov. Jerry Brown is scheduled to release his annual budget proposal at the Capitol on Friday, before traveling to San Diego and Los Angeles to promote it in big media markets later in the day.

The Democratic governor has approached improving budget indicators with caution, urging lawmakers to bolster reserves. In his budget plan, he is expected to support a proposal by Assembly Speaker John A. Pérez to put a rainy-day fund constitutional amendment on the November ballot.

The Legislative Analyst's Office projected last fall that the state could post a $5.6 billion surplus by June 2015, with annual surpluses reaching $8.3 billion by the 2016-17 budget year.

PHOTO: Senate President Pro Tem Darrell Steinberg, left, Gov. Jerry Brown, center, and Assembly Speaker John A. Pérez, right, celebrate a budget deal with a formal announcement at the California Capitol on Tuesday, June 11, 2013. The Sacramento Bee/Randy Pench

The Sacramento TV news anchor approached to challenge GOP Rep. Tom McClintock says he isn't running for Congress after all.

Earlier today, KXTV-TV anchor-reporter Walt Gray said he had been courted to run in the 4th Congressional District.

"I've always had a strong advisory group of rogues, friends and motorcyclists to raise money for charity and assist in all my endeavors in Sacramento the past 26 years," Gray told The Bee. "Should I need them ... they're here."

Gray, known for his annual motorcycle trek benefiting the Make-A-Wish Foundation, said in a statement hours later that he isn't running.

"I am humbled and flattered to have been contacted about running for the 4th District Congressional seat," he wrote. "I truly love spending time in that part of the state. It's just not something that I can see doing. I enjoy serving the people in my current role at News10 and hope to focus my attention on that and being around to help my wife, Monica, raise our three young kids. I will see you on News10 on Saturdays and Sundays at 6 a.m. and 8 a.m."

Gray spent 24 years as an anchor and reporter at KCRA-TV and made a brief stint hosting morning radio before returning to the television airwaves.

For what it's worth, Jon Huey, McClintock's campaign manager, had this to say about a possible run by Gray: "Tom has known and liked him for many years and believes he would be an interesting and articulate voice in the race."

PHOTO: Walt Gray. KXTV-TV News10

Assembly Republican Leader Connie Conway might be losing her seat at the end of the legislative session because of term limits. But she's gaining something else entirely: a husband.

Conway's fiancé, Tulare City Councilman Craig Vejvoda, popped the question just before Thanksgiving while lawmakers were away for the winter break, Conway spokeswoman Sabrina Lockhart said Tuesday.

Vejvoda works as a financial advisor with the Principal Financial Group.

Last September, Assembly Republicans reaffirmed their support for the 63-year-old Conway to continue serving as their leader. Conway, who has identified the budget, economy, education, healthcare and public safety as key issues for the caucus, was spotted flashing her engagement ring on the opening day of session. She is divorced and has 2 grown children.

A wedding date has not been set, Lockhart said, but the assemblywoman does not plan on getting married prior to her term ending in November.

PHOTO: Assembly Republican Leader Connie Conway, R-Tulare, speaks at a press conference on June 30, 2011. The Sacramento Bee/Hector Amezcua

Senate President Pro Tem Darrell Steinberg said the state's improving budget outlook allows lawmakers to create universal pre-kindergarten without taking money from other priorities.

Wouldn't San Francisco, which has had a thriving gay community for decades and where the same-sex marriage revolution began, automatically be considered the gayest city in America?

Well, The Advocate, a major gay publication, doesn't even put San Francisco in its top 10 gayest cities.

No. 1, The Advocate says, is Washington, D.C., and one has to go all the way down to 11th place to find San Francisco — nine places lower than No. 2 Pasadena, described by the publication as "a kind of bedroom community for gays who like to garden..."

In fact, San Francisco ranks behind No. 10 Arlington, Va., No. 9 Oakland, No. 8 Salt Lake City (a real shocker, given the prominence of the anti-gay marriage Mormon Church), No. 7 Madison, Wis., No. 6 St.Louis, No. 5 Atlanta, No. 4 Cambridge, Mass., and No. 3 Seattle. Long Beach is No. 14.

The Advocate's rankings are admittedly subjective, as it explains:

"It's not all piano bars, gender-specific music festivals, and giant disco houses (although we all love some of those things) that make these cities the gayest in America.

"You say you're shocked Los Angeles, San Francisco, and New York City aren't at the top of the list, this year and every year? What kind of fun would that be? (Spoiler alert: San Francisco comes in at No. 11.)

"This year's criteria, designed to uncover the hidden factors that give a city its queer cred, include points for a city's LGBT elected officials (and fractional points for the state's elected officials), points for the percentage of the population comprised by lesbian-coupled households, a point for a gay rodeo association, points for bars listed in Out magazine's 200 Best Bars list, a point per women's college, and points for concert performances by Mariah Carey, Pink, Lady Gaga, or the Jonas Brothers.

"The raw score is divided by the population to provide a ranking based on a per capita LGBT quotient."

Despite its relatively low ranking in the gayest city evaluation, The Advocate says of San Francisco:

"Calm down, San Francisco. Everyone knows you're still the gayest thing going. The beautiful, panoramic City by the Bay is home to both well-heeled queers and a vibrant counterculture (witness the uproar over the recently announced ban on public nudity).

"LGBT life here is not limited to the Castro neighborhood, though that's a tourist draw for good reason - it's a queer Disneyland. You'll find us in every neighborhood, and gay-owned and gay-popular bars, restaurants, and business are everywhere. San Francisco is home to more nightlife than you can shake a go-go boy at, as well as vibrant bear and trans communities."

PHOTO: A picture-perfect view of San Francisco, as seen from the Marin Headlands. The Sacramento Bee/Manny Crisostomo

Declaring it a caucus priority for coming budget talks, Senate Democrats have introduced legislation that would make all four-year-olds eligible for pre-kindergarten classes.

The proposal builds upon a transitional kindergarten program that was part of a 2010 law requiring children to be older when they enroll in kindergarten. That program, though, covers only one-quarter of four-year-olds, about 120,000 children, whose birthdays fall within the last three months of the year.

Tuesday's proposal would phase in all four-year-olds over five years, at an estimated cost of $198 million annually. The total cost for 350,000 pre-kindergarten students would reach almost $1 billion annually by 2019-2020, Senate President Pro Tem Darrell Steinberg, D-Sacramento, said at a news conference at Harkness Elementary School in south Sacramento.

Steinberg acknowledged the expense, but said universal pre-kindergarten was an appropriate way to spend some of California's expected budget surplus because students would benefit greatly.

"I am proud to call this wise spending in California," Steinberg said.

Elk Grove Police Chief Robert Lehner added that students who do well in school are less likely to commit crimes.

Assembly Democrats included universal pre-kindergarten for four-year-olds in a blueprint of budget priorities released last month. Their plan's phase-in is similar to Tuesday's proposal.

Is veteran Sacramento news anchor Walt Gray considering a challenge to Republican Rep. Tom McClintock in the 4th Congressional District?

Gray, who is not affiliated with a political party, called the possibility of a run "premature."

But the television personality and motorcycle enthusiast said he believes the Northern California district represented by McClintock is full of citizens concerned that their voices are not being heard. "I've been contacted by some of them about my interest in running for Congress," Gray confirmed in response to an inquiry from The Bee.

In the carefully worded email Tuesday, Gray said while he's never held elective office, "I think that's a positive. People want fresh ideas."

Gray spent 24 years as an anchor and reporter at KCRA-TV and made a brief stint in radio hosting the morning show on 96.9 The Eagle before returning to the television airwaves at KXTV-TV, where he works as an anchor-reporter. He also is known for his Walt Gray Ride, an annual motorcycle trek benefiting the Make-A-Wish Foundation.

"I've always had a strong advisory group of rogues, friends and motorcyclists to raise money for charity and assist in all my endeavors in Sacramento the past 26 years," he wrote. "Should I need them ... they're here."

McClintock, a conservative stalwart, represented Ventura-area districts in the state Legislature and periodically mounted unsuccessful runs for statewide office, including for controller, lieutenant governor and governor. He won a close congressional race in 2008 and since then has cruised to re-election. His Elk Grove home remains outside of the Foothill-based 4th district.

4th Congressional District

Gray, whose Land Park home is also outside the 4th district, said he's nonetheless spent "countless hours ... years really" reporting on news events and riding his motorcycle from town to town there. "It's one of my favorite places in the world to spend time in," he said.

Gray added that his father, Walt Gray, Sr., served two terms as a state senator in Rhode Island.

"Politics is hard job," Gray said. "You have to be all in."

PHOTO: Anchor Walt Gray rides down J Street during Saturday's car cruise through the streets of Midtown in Sacramento on July 30, 2010. The Sacramento Bee/Jose Luis Villegas

First lady Michelle Obama is scheduled to make a fundraising trip this month to San Francisco, a White House official confirmed Monday.

Obama will appear with House Minority Leader Nancy Pelosi, D-San Francisco, for a "Women's Lunch" and reception on Jan. 31 at the Fairmont Hotel benefiting the Democratic Congressional Campaign Committee.

It's unclear whether the first lady is attending other events during the West Coast swing.

An invitation for the San Francisco luncheon lists the tickets at $500 apiece. Co-chairs receive a ticket for the photo line and a table of 10 for $10,000 while chairs get two tickets to a VIP reception and photo line, along with a table of 10, for $32,400.

Obama was to attend a series of fundraisers in Los Angeles and the Bay Area last October, including a brunch alongside Pelosi at the Fairmont Hotel, but rescheduled the trip amid the partial federal government shutdown.

With control of the House of Representatives in the balance, President Barack Obama and the first lady have reportedly agreed to headline a handful of fundraisers ahead of the midterms.

PHOTO: First Lady Michelle Obama looks out from the stage as President Barack Obama speaks to members of the military and their families in Anderson Hall at Marine Corps Base Hawaii on Dec. 25, 2013. Associated Press/Carolyn Kaster

Among the highlights of yesterday's return of the Legislature were an extended series of adjourn-in-memories for Nelson Mandela, who passed away last month during the legislative recess, and some interpersonal intrigue over new seating arrangements in the Senate.

But policy priorities for legislators continue to emerge. Today state Senate President Pro Tem Darrell Steinberg plans to announce a new bill for universal transitional kindergarten in California.

The proposal builds on the Sacramento Democrat's 2010 legislation moving up the cutoff date for entering kindergartners so that all students are at least five years old. That law also created new "transitional kindergarten" classes for the older four-year-olds who were no longer eligible to start school, providing adapted instruction to continue their development. Steinberg's bill would extend that opportunity to all four-year-olds in the year before they enter kindergarten.

Steinberg will be at Harkness Elementary School in Sacramento at 10 a.m. for the announcement. He will be joined by California's Superintendent for Public Instruction Tom Torlakson and several Democratic senators who are co-sponsoring the legislation: Carol Liu of La Cañada Flintridge, Marty Block of San Diego, Jerry Hill of San Mateo, Holly Mitchell of Los Angeles, Ricardo Lara of Bell Gardens and Lois Wolk of San Francisco.

VIDEO: The start of a new legislative session is like the first day of school, Dan Walters says.

THREE-PEAT: California is experiencing one of the driest starts to winter it has ever recorded: A snow survey in the Sierra last week confirmed that snowpack is currently at 20 percent of its average for this time of year. With the state now preparing to enter its third straight drought year, the State Board of Food and Agriculture holds a hearing on how the agricultural community can prepare, 10 a.m. at the Dept. of Food and Agriculture building on N Street.

LOW ACHIEVER: Oakland-based advocacy group Children Now has released its annual Children's Report Card evaluating the state's performance in education, health and child welfare issues. The report is fairly critical, awarding no grades of A and 13 D's in its 27 categories. You can read the report in its entirety here.

HEALTH SCARE: Last summer's Rim fire was the third-largest forest fire in state history, and California could be facing more troubles ahead should the extremely dry conditions continue. One unforeseen consequence of such disasters is long-term adverse effects on the immune systems of children exposed to high levels of air pollution during their infancy. UC Davis researcher Lisa Miller discusses more in a seminar at the Cal EPA Headquarters on I Street at 10 a.m.

PHOTO: Kindergarten teacher Katherine Hoffmore, 48, left, works on a bead project with McKayla Parker, 6, right, where they learn to repeat patterns at Greer Elementary School in Sacramento on Jan. 17, 2013.

Lawmakers were like eager students on the first day of session, Dan says, though one has already been sent to detention.

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See other Dan Walters Daily clips here.

California is doing a poor job of meeting the health, education and economic needs of its children, Children Now, an Oakland-based advocacy organization, says in its latest Children's Report Card.

The unmet needs for well-being are especially acute among the nearly half of California's children who live in low-income households, the organization's president, former Assemblyman Ted Lempert, said.

"The declining status of kids in California is the biggest threat to the health and economy of our state," Lempert said in a statement accompanying the report. "Californians across the board want to see children doing better and we need to hold the state's policymakers more accountable this year for making that happen."

The annual report covers 27 issues, giving the state a grade in each, noting where there has been progress and making recommendations for action. It praises, for example, the newly enacted overhaul of state school finance that directs more money to school districts with large numbers of poor and English-learner students, but says that overall financing of the state's schools remains about $3,500 per pupil below the national average.

All of the Children Now recommendations would cost substantial amounts of money. Just raising school spending to the national per-pupil average, for instance, would take another $21 billion a year. But the organization's report contends that spending the money would pay economic dividends for the state in the future.

PHOTO: Children participate in the 10 years-old and under race during the Superheroes 5K run on June 16, 2013 in Sacramento. The Sacramento Bee/Paul Kitagaki Jr.

Republican Ray Haynes is weighing a run for Congress in the Southern California desert.

In an email to supporters, the former state lawmaker said he may seek the 36th Congressional District seat held by freshman Rep. Raul Ruiz.

Haynes' entry would complicate what was expected to be a two-way race between Ruiz and GOP Assemblyman Brian Nestande, who has carved out a reputation as a moderate voice in the caucus. Ruiz emerged as a top target of Republicans after soundly defeating former Rep. Mary Bono Mack in 2012.

Republicans enjoy a nearly 1.5-percentage point voter registration advantage in the district that stretches from Hemet east to the California-Arizona border.

"The time to win the 36th Congressional district is this year, and so, if I am to re-engage in politics, this would be the time to do so," he wrote. "That is why I am looking at this seat now."

In his message, posted in its entirety here, Haynes said he believes the district wants a conservative Republican as its representative. He asks his network of supporters whether they would back him in a potential run.

"Over the last couple of years I have found myself becoming more and more frustrated by what is going on in Washington," Haynes wrote. "Quite frankly, I could live the rest of my life, never be in Congress, and believe that I have done well by my neighbors during my time in politics. However, there are times when I believe I can be value added to the country, my state, my county, and my neighbors by giving voice to their concerns and their needs in the political arena."

PHOTO: Assemblyman Ray Haynes, R-Murrieta, a member of the Assembly Judiciary Committee, questions Assemblyman Mark Leno, D-San Francisco, not shown, about Leno's same sex marriage bill on Tuesday, April 26, 2005. Associated Press/Rich Pedroncelli

Gov. Jerry Brown's proposal to use fees paid by carbon producers to help finance the state's high-speed rail project is expected to amount to $250 million next budget year, a sum that could provide a significant lift to the project but frustrate environmentalists already upset about the diversion of fees.

Brown is expected to include the proposal in the annual budget plan he will release Friday, sources told The Sacramento Bee. The amount is included in about $750 million in total cap-and-trade funds the governor is expected to propose allocating among transportation, green energy and other programs to reduce greenhouse gas emissions.

In addition, Brown is expected to propose paying back part of a $500 million loan from the cap-and-trade program to the state general fund included in this year's budget. The amount of the repayment is expected to be $100 million.

Many environmentalists criticized the loan last year and have bristled at the idea of using cap-and-trade money for high-speed rail, saying other projects could have a more immediate impact on greenhouse gas reduction.

Brown's office has declined to discuss the budget ahead of its release.

PHOTO: A view of the interior of a station in the proposed high speed rail network. Rendering by Newlands and Company Inc., 2008.

California's political ethics watchdog continued its proactive approach to enforcing the state's political reform act last year, with prosecutions of serious campaign cases and lobbying violations reaching record highs in 2013.

The Fair Political Practices Commission closed 854 cases with violations, according to its end-of-year report released Monday. The number of cases the agency opened surpassed 350, an increase of more than 300 from 2012.

Under its former chief Ann Ravel, who recently departed for the Federal Election Commission, the FPPC increased its focus on major misbehavior rather than less-significant offenses. Commission-initiated cases were virtually nonexistent before Ravel's tenure.

FPPC officials said they hoped to maintain the more aggressive pursuit, including launching investigations in the midst of elections where they could have a greater impact.

"We're trying to continue that past her tenure," said Gary Winuk, the agency's chief of enforcement.

In 2013, prosecutions into conflicts of interest and compliance with requisite financial disclosure statements both reached all-time highs. Overall, the number of complaints received and cases opened and closed rose significantly over the last year, the report shows.

Among the cases cited were the commission's record $1 million settlement with a pair of nonprofits for failing to disclose the source of contributions to oppose Gov. Jerry Brown's Proposition 30 tax increases and support an anti-union measure, Proposition 32.

Other prominent investigations involved leveling $40,500 in fines against three partners in a prominent public affairs firm in Sacramento and fining former Democratic Sen. Dean Florez of Shafter $60,000 for misusing campaign funds.

Of the total cases prosecuted last year, 29 percent involved major campaigns and 7 percent centered on lobbying. At 42 percent, the bulk of the agency's prosecutions involved failures to report required statements of economic interest.

PHOTO: Gary Winuk, the chief of enforcement, speaks in front of the Fair Political Practices Commission meeting in September. The Sacramento Bee/Hector Amezcua