May Legislative Update

Administrative Actions
The Governor recently revealed a four-phase timeline to reopening the state. Currently, the state is undergoing phase one, which is planning and preparing workflow, supply chains, testing, and contact tracing. The Governor reminded us all of the importance that hospitals must continue to be ready to meet surge capacity should the demand arise and procure enough PPE to meet these critical needs, however, he stated that the most important factor will be to ensure the state has sufficient testing capabilities and has implemented a strong contact tracing network as well, which is not complete.

Despite the “cautious optimism” expressed by the Director of the California Department of Public Health, the purpose of the press conference was to explain why the state is not relaxing the order in the same fashion as other states and to reiterate the previously stated goals (indicators) that need to be reached in order to open various sectors of the economy. They also encouraged Californians to provide input on the modifications to the stay-at-home orders and creating safe workplaces, referring to a new place on their website for direct involvement.

Phase two is likely to come in the following weeks and it focused on schools, childcare and “low-risk” workplaces such as retail (e.g. curbside pickup), manufacturing, offices (when telework not possible) and opening more public spaces. It is important to note that “personal care,” like nail and hair salons were intentionally not included in this phase of the process. Schools may also reopen earlier than previously anticipated (possibly in July) to address learning gaps that have been created for students as a result of distance learning programs.

In addition to data trends stabilizing (hospitalizations and ICU numbers), the move to phase two requires that three goals be achieved:

  1. Continue to build out testing, contact tracing, PPE, and hospital surge capacity.
  2. Continue to make essential workplaces as safe as possible.
    a.  Physical and workflow adaption
    b.  Essential workforce safety net
    c.  Make PPE more widely available
    d.  Individual behavior changes
  3. Prepare sector-by-sector safety guidelines for expanded workforce

Phases three and four are likely months away and will apply to high-risk workplaces (phase three) and venues where large crowding occurs (phase four). Phase three will require an increase in planning and the state must adopt stringent safety precautions. Facilities such as gyms, spas, sporting events without an audience, and religious services fall under this category. Stage four will only be reached when the state has herd immunity or a vaccine available, and includes concerts, conventions, and sporting events with spectators.

It is important to note that today’s announcement lacked details and instead it presented a more specific “roadmap” for the decision making process. The Governor also spoke about “localism” and “regional variations,” which meant that counties may choose to relax stricter local orders at their own pace, referencing the Bay Area’s shelter-in-place order. However, he appeared to discourage relaxing local orders until a statewide surveillance system is achieved through rigorous testing.
Legislative Actions
On Tuesday, April 28th, the State Assembly unveiled a “tentative” calendar of committee hearings to capitol staff this week, as it prepares to resume session on Monday, May 4. Each committee will meet only once and hear a full list of bills referred to their respective committees. It is still unclear which bills will be set to be heard in each committee, but some formal agendas are expected to be posted by the end of the week. Policy committees in the Assembly are expected to meet through May and culminate in both Appropriations and Budget negotiations by early June.

Senate President pro Tempore Toni Atkins announced the Senate expects to reconvene on May 11. This date is not final and is also contingent on information from health experts. The chamber’s procedures and protocols will be announced prior to the final return date. The Senate’s Special Committee on Pandemic Emergency Response will be meeting Wednesday, May 6 remotely, to review the state’s response and determine where improvements can be made. This hearing will follow procedures similar to the Senate Budget Subcommittee’s hearing on April 16.

Member offices have expressed optimism that this new expeditious format would still allow them to adjourn for summer recess as planned in early July. They also indicated that bill testimony and access to the hearing rooms will be limited, so lobbying and all preparations for the presentation to the committee will be expected to be conducted remotely. However, the Assembly is trying to arrange for live video access to expert witnesses to accompany the member’s presentation. More details on the committee agendas, process and procedures are expected to be released next week.

The San Francisco Housing Action Coalition (SFHAC) hosted a town hall on Wednesday, where Senator Wiener and Assembly Members David Chiu and Phil Ting expressed to the audience an optimism that their houses will resume considering legislation in May.  Sen. Wiener, Chair of the Senate Housing Committee, spoke with more optimism than expected, and revealed that the Committee has narrowed all introduced housing bills to about 15 bills. By prioritizing specific fixes, he believes the Legislature is in good standing to see a majority of them on the Governor’s desk. With a smaller number of bills, he hopes this will increase their chances of being signed by Governor Newsom. These bills are expected to be heard at one committee hearing, with the date to be determined.

Asm. Chiu also expressed optimism that housing developers might be able to capitalize on the recession and potential value depreciation in land costs and potentially be able to acquire and develop more affordable and mixed-use units while land and labor are less expensive. Chiu was also sincere in his commitment to still promote legislation this year that will focus on rezoning land and removing barriers to development so that next year the state has the ability to quickly increase housing production. He gave some examples which are already embodied in introduced legislation, such as rezoning parking lots and land owned by faith-based institutions as well as streamlining the development process are just a few of the bills currently being considered.

Asm. Ting spoke about the budget, which has received major focus over the last few weeks. He warned that budget cuts will be necessary and expected. We will see fewer bills signed by the Governor this year as the state will no longer have the surplus to fund new programs. While this means fewer housing and homelessness bills, Asm. Ting remained optimistic that the state will continue to prioritize these two issues, as these crises permeated long before the pandemic and will continue afterwards. All the members agreed that a permanent source of funds must be identified for housing production, with Asm. Chiu promoting AB 1905 to eliminate tax deduction for home mortgages.

Finally, Asm. Ting communicated that legislation proposing to reduce impact fees for housing projects is a non-starter in this new political environment and he argued that they should not be considered until Prop. 13 is reformed. This latter comment comes as the Public Policy Institute of California (PPIC) unveiled a new survey result finding a slim 53% majority of voters support the split roll tax ballot that qualified for the November ballot.

Policy Area Updates

Despite construction being considered an “essential” business which can operate with modest limitations amid the pandemic, a study released this week by the Associated General Contractors of America indicated that construction was roughly 1-in-9 lost jobs statewide last month. California had 885,300 construction workers prior to the pandemic — number one nationally — but was down 11,600 jobs in March, according to the study. That was the third-largest statewide drop since 2010 and the number one drop nationally. Federal job stats show jobs fell in 31 states in March with Texas (down 50,900 jobs) and New York (41,700) showing the next-biggest declines.
The $310 billion in funding for Paycheck Protection Program loans considered by Congress to help small businesses, could help retain construction jobs. Even though this is one of the few sectors of the economy still operating, construction firms still have significant payrolls in need of protection. More than 50 percent of construction firms are reporting project cancellations or delays and construction employers are struggling to retain workers.

During last Monday’s Budget hearing, it was clear that the issue of homelessness is very important to the Legislature – a theme that carried on throughout many webinars this week. Many Members want to ensure that the Project Roomkey sites can and will be procured for the homeless population beyond the pandemic. Assemblymember Cooper announced that he intends to hold a Budget Subcommittee 4 hearing to discuss homelessness during and after COVID-19 in the first week of May. At the SFHAC Town Hall last Wednesday, Senator Wiener and Assemblymembers Chiu and Ting all made clear their preference to see the temporary shelters provided under Project Roomkey procured for permanent use after the pandemic.

Some cities, such as Los Angeles, have decided to allow safe tent encampment sites during the pandemic. An article in the San Francisco Chronicle reported that San Francisco is frantically searching for spaces to safely house their homeless population who are currently in tents crowding the sidewalks. Supervisor Rafael Mandelman introduced legislation this week to allow the city to convert empty parking lots into sanctioned encampments where the homeless can set up tents.