California Homeowners Bill of Rights – New Law for 2013.

The new California Homeowner Bill of Rights becomes law today. If you’re not familiar with this measure, it was a bill carried on behalf of California Attorney General Kamala Harris last year that sought to codify some of the measures set forth in the national mortgage settlement deal struck in early 2012. 

Initially opposed by the California Association of Realtors as well as the California Bankers Association and the California Mortgage Bankers Association, the bill was pushed through the legislature by a closed joint committee  of both houses so when the bill eventually reached the floor, it was voted on immediately and passed to the Governor. Total time in committee, floor and signature was measured in hours rather than days, months or years, as is typical for most bills. 

Due to the secretive nature of the committee structure, there was little opportunity for interest groups to provide input and there was great concern that what emerged would be a very flawed effort reflecting an over reaction to purported lender wrongdoing. However, CAR did have an opportunity to work with the committee to effect some modifications to the final version that removed our opposition to the bill. CAR was not supportive of the bill in its final version but adopted a neutral position, although banking groups remained steadfast in their opposition due to to concerns about meritless litigation that the bill opens up for aggreaved homeowners. 

Here’s what the bill does:

  • Stops dual tracking. Once the process has started for either a loan modification or short sale by the lender, the foreclosure process must be stopped. This is in response to cases where the property proceeds along multiple courses at the same time only to have the foreclosure process conclude days ahead of a short sale approval by another arm of the bank. As pointed out, this frequently resulted in the bank taking the property back and ultimately receiving thousands less in the foreclosure sale than they would have in a short sale. Of course we know the banks are covered either way and really don’t care but ultimately this should result in more short sales and fewer foreclosures, which is better for the recovering market.
  • Under the dual tracking provisions, banks must give an applicant a response to their loan modification before they can start the foreclosure process. If a homeowner has not applied for a loan modification, the bank must inform them of their right to do so before starting the foreclosure process.
  • No more robo signing.
  • Banks must provide a single point of contact to borrowers trying for a loan modification or short sale. Homeowners and Realtors are often frustrated by multiple points of contact and the handoff fr5om one agent to  another within a bank frequently resulting in the loss of paperwork sending the process back to square one while the foreclosure process continues apace in another department.
  • Allows the borrower to sue loan servicers if the borrower thinks they have violated any foreclosure laws. This is one of the most worrisome components of the bill in that it may open the door to frivolous lawsuits resulting in increased costs and unnecessary delays in an already costly and time consuming process. 

With nearly 1 million foreclosures recorded in the state since 2007, California remains one of the hardest hit areas of the country. However, foreclosures are down in most areas by 30% or more in the past year and with prices starting to climb across the state, the hope is that fewer and fewer people will be pushed into foreclosure anyway. Some 30% of state homeowners remain underwater in their loans but the combination of improving employment statistics and home price increases has decreased that by more than 5% in the past year.

The Homeowners Bill of Rights may well provide some relief for harried homeowners and produce further delays to the process, but it will do little to change the underlying ability of a homeowner to ultimately afford their home and will, in most cases, only delay the inevitable. If Sacramento and DC don’t screw it up, an improving economy will do more to aid homeowners than the HBR will ever accomplish – and ultimately that’s the best news for everybody. 

Another Bogus Budget

KEVIN’S CORNER

It was another rough month for the families and taxpayers of California, as the legislature completed this year’s budget this week.  I don’t know if there is anyone who is actually happy about the budget, as even the majority party who crafted it in its entirety would certainly rather be growing rather than cutting and eliminating programs.  But there are bad ways to deal with a deficit of this size, and there are worse ways, and make no mistake about it-they have chosen some of the very worst ways to do it.

A few of the worst elements of this budget plan (in no particular order):

  • Once again, the process was done largely in secret behind closed doors.  Hearings were held only on the most general concepts (when they existed at all), and witnesses were unable to say how specific programs might be affected or how much would be spent or cut.  Groups who were affected by the cuts (like local governments) were not allowed to see the final language until it was too late to organize against it, and promises that had been made in negotiations before the budget were absent when the bills were passed on the floor.
  • The budget is based on the assumption that California’s voters will pass an $8 billion tax increase in November, despite the fact that voters have rejected the last 8 taxes to appear on state-wide ballots, including the tobacco tax that just failed in June.  If voters are unwilling to support a relatively small tax that doesn’t affect most of them to cure cancer, are they really likely to pass a massive tax increase that will affect everyone and be spent by our dysfunctional state government?
  • The relatively successful Healthy Families Program that covers medical and dental care for poor children was scrapped, putting them into the state’s Medi-Cal program instead.  Healthy Families is administered by a private group for $50 per client, Medi-Cal is run by state employees for $395 per client.
  • Roughly $16 million was budgeted for administration and collection of the problematic and likely illegal fire tax.  It is likely that no net revenues will ever be recovered from this tax before it is struck down, and we will pay $16 million  for nothing.
  • It is expected that next week the Legislature will approve the $2.7 billion in bond sales that the governor wants for initial construction of the High Speed Rail Program, which will cost the state general fund roughly $180 million annually for 30 years-enough to keep all the State Parks open, fully fund the UCR Medical School, and restore funding to the cities in Riverside County who were victimized in last year’s budget-and still leave tens of millions of dollars to restore other cuts in critical programs or schools.
  • The Governor has targeted massive and unnecessary cuts at education if his tax increase fails as expected  in November.  I supported a budget alternative that would have protected schools and higher education from budget cuts, but it never even received a hearing.  Holding a figurative gun to the head of schools to force voters to pass his tax increase is a cynical move that exposes his true priorities.
  • Pension reform has been cast aside again.  Rather than including the billions in potential savings from legitimate reform in the state budget, votes on the Governor’s plan (a good one, actually) have been rejected, and all discussion of reform has taken place in private.  Rumor has it there may be a vote on some sort of reform next week, but once again, nobody but the legislative leadership and the government union leaders who elected them know what will be in it.
  • Local governments were once again victimized in multiple ways that attack their authority, their flexibility, their budgets, and the safety of their residents.

I am asked regularly what can be done to fix the problems in Sacramento, and there are no easy answers.  With the passage of Proposition 25 two years ago, only a simple majority is required to pass a budget, so the party in charge in Sacramento has free reign and can now make decisions based on whatever priorities they want.  The only way to change what is happening in the Capitol is to change the folks who are running the State Capitol.

Another option is through the initiative system, which allows citizens to go around those who control state government.  There is an initiative which just qualified for the November ballot that does put some restraints on how your government operates, including a requirement that bills be in print and publicly available for 72 hours prior to a vote.  I haven’t had a chance to review all the reforms contained in this measure, and this should not be considered an endorsement of the “Government Performance and Accountability Act”, but it is increasingly clear that the legislature is not willing to reform itself, and change will likely have to be forced upon them.

Because I am leaving the Assembly at the end of the year, this was my last budget fight in Sacramento, and I can guarantee I will not miss it one bit!

Sincerely,

Kevin

CAR OPPOSES AG’s Homeowner Bill of Rights.

California Homeowners Bill of Rights:

A Lesson in Political Expediency & Unintended Consequences.

California Attorney General Kamala Harris announced in a much heralded press release today that her ‘California Homeowners Bill of Rights’ has ‘taken a key step toward passage’. Here’s the key step – she bypassed every preliminary opportunity for the bill to be discussed, debated or voted on in either the Assembly or the Senate. What she did, or had her minions in the Legislature do for her, was have the bill introduced to a ‘two-house conference committee’ that voted this morning to pass the bill. That means tomorrow or, more probably Monday, the full Senate and Assembly will vote on the bills – SB 900 & AB 278 with no discussion.

You’ve heard me discuss the measures previously as the Nevada Suite of bills, so named for the deleterious results Nevada experienced after passing similar legislation last year. Did I mention the ‘special committee’ was made up of 4 Democrats and 2 Republicans? Now guess what the vote was? That’s called a ‘procedural matter’ in Sacramento. Roughly translated it means ‘bend over’.

Here’s C.A.R.’s take on the issue:

C.A.R. is OPPOSING conference report, AB 278, containing anti-foreclosure legislation sponsored by the state Attorney General. C.A.R. opposes provisions in this measure which will allow anyone to stop the foreclosure process by filing a lawsuit, merited or not, C.A.R. agrees that careful and balanced reforms to the foreclosure process are necessary. However, C.A.R. opposes this conference report because it will further delay the housing recovery by inviting bad-faith lawsuits and defaults, and making it difficult for even well qualified borrowers to obtain financing. Financing is already very difficult to get. This conference report will only make a difficult situation worse.

Initially the Attorney General had sponsored a package of bills; the so-called the “Homeowners Bill of Rights.” For procedural reasons, the majority of these bills have been under consideration by a Conference Committee made up of six legislators. REALTORS® had the opportunity to educate these legislators about C.A.R.’s concerns as part of Legislative Day and since then C.A.R. lobbyists have been working directly with the conferees and legislative staff to make them aware of the unintended consequences of some of these proposals. The Conference Committee has now issued its final report and it must be passed by both Houses of the legislature. These votes may occur as early as Monday, July 2nd.

Background

The Attorney General has sponsored a package of bills to place into California law an expanded version of the national settlement between major banks and state attorneys general. The contents of some of these bills have been under consideration by a Conference Committee comprised of six members who have just approved a conference report on a party-line vote. Some provisions will have the unintended effect of drying up mortgage loans for anyone but the most well-qualified borrowers, and increasing the costs of all mortgages.

One provision allows any borrower, no matter what the circumstances, to file a lawsuit. This will encourage opportunistic lawyers to pursue frivolous lawsuits, bringing unnecessary and unjustifiable delays to an already difficult and time consuming process. The language is so vaguely written that the borrower doesn’t even have to show that they have been harmed to file suit and be awarded damages.

One-sided  attorneys fees may still be awarded only to plaintiffs based on the very broad definition of a “prevailing party” in the report. And, of course, if lenders don’t have the remedy of foreclosure to ensure they can recover their security in appropriate situations, they will be less likely to lend, credit will be less available and the housing market recovery will limp along even more slowly.

C.A.R. is OPPOSED to the conference report because:

 

  • The housing market recovery is still fragile. About half of all sales are of distressed properties. By restricting a lender’s ability to foreclose and exposing them to unnecessary liability, this report will dry up inventory, and it will further discourage lending other than to the most highly qualified borrowers. Additionally, these bills will artificially slow down the foreclosure process, keeping properties off the market that are legitimately in foreclosure. Finally, by removing the threat of foreclosure, the bill erodes the incentive for short sales as well.
  • The bill invites bad-faith defaults and lawsuits. By broadly defining under what circumstances a lawsuit can be filed, even those legitimately in foreclosure can “game” the system. Additionally, the bill creates an incentive for plaintiffs’ attorneys to file frivolous lawsuits even if no harm has been done to the borrower. The courts are already overwhelmed. This bill, by inviting frivolous lawsuits puts an additional strain on the already underfunded courts
  • Lending is already tight. Even the most well-qualified borrowers are finding it difficult to obtain financing. By stopping legitimate foreclosures, banks will be forced to further tighten lending standards at the expense of homebuyers.

 

We’re not intimating that everything contained in the bills is bad and we have been supportive of some of the issues. We also have a competing dual-tracking bill in play that we feel is more balanced and less vague. But this is a take-it-or-leave-it kind of bill – you have to eat the whole enchilada and there are no amendments allowed at this point. All the bad will be with us as law along with the few good things it might accomplish. Sound familiar?

This is also what is referred to as a ‘gut & amend’ bill. For 1 1/2 years some bills have been floating around the Legislature knowing full well they weren’t going anywhere. They were being held for just such a vehicle as this to rise from the ashes and require a last minute vote – often with only minutes of notice.

So this bill will pass UNLESS you can convince your Democratic Legislator to vote against it. Otherwise it’s a simple exercise in vote counting (53 – 27) to ascertain that our housing market will take another hit – a victim of increased frivolous lawsuits, further restrictions on foreclosures and tightened lending standards.

So now you know the proverbial ‘other side of the story’ and it’s not pretty. I encourage you to read the bill at  AB 278 and then read the AG’s release below. While the release summarizes a much glossed over purview of the bills, the devil is in the details. So go to work on your Democratic Legislators and let them know how Realtors® feel, and every homeowner and landlord who doesn’t feel like paying the price this bill will cost.

 

 

NEWS RELEASE

June 27, 2012

FOR IMMEDIATE RELEASE
(415) 703-5837

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California Homeowner Bill of Rights Takes Key Step to Passage

SACRAMENTO — Attorney General Kamala D. Harris today announced the passage of two central elements of the California Homeowner Bill of Rights through a special two-house conference committee. The 4 to 1 vote sends the bills to an expected vote next week in both the Assembly and Senate.

The two bills approved by the conference committee are the Foreclosure Reduction Act, which restricts the process of “dual-tracked” foreclosures and the Due Process Rights Act, which guarantees a reliable contact for struggling homeowners to discuss their loan with and which for the first time imposes civil penalties on the practice of fraudulently signing foreclosure documents without verifying their accuracy, a practice commonly known as “robo-signing.” The proposed legislation also includes meaningful enforcement for borrowers whose rights are violated.

The full Homeowner Bill of Rights includes additional provisions to reduce blight, ensure appropriate law enforcement response to mortgage fraud and crime, and protect tenants.  The bills containing these protections are also advancing through the Legislature.

“I am gratified by this vote, which represents one more step toward our goal of achieving a Homeowner Bill of Rights for California,” said Attorney General Harris. “The mortgage and foreclosure crisis in our state demands urgent efforts to help Californians keep their homes. The legislature will now have the opportunity to cast a vote on behalf of California’s struggling homeowners.”

The California Homeowner Bill of Rights was introduced February 29, 2012 at a press conference featuring Assembly Speaker John A. Perez and Senate President pro Tem Darrell Steinberg and bill authors from the Assembly and Senate. The goal of the Homeowner Bill of Rights is to take many of the mortgage reforms extracted from banks in a national mortgage settlement and write them into California law so they could apply to all mortgage-holders in the state.

“The mortgage and foreclosure abuse in California ends here,” said Noreen Evans (D-Santa Rosa), co-chair of the Joint Conference Committee. “This committee has passed historic legislation that codifies the
protections eligible homeowners deserve, while helping to stabilize the foreclosure crisis that has thwarted California’s economic recovery. The Legislature has studied, listened and engaged Californians and
industry to find a solution that is fair and effective to mitigate this crisis. I look forward to the full support of the Legislature and Governor in implementing this package.”

“This bill is the result of a long and difficult process in which we received input from all interested parties; including homeowners and the banks and found that foreclosures benefit no one,” said Assemblymember Mike Eng (D-Alhambra). “We ended such dubious practices as having a bank foreclose while a homeowner is in the process of modifying a loan and cut through confusion by making sure that there is a ‘single point of contact’ with mortgage servicers.  With half a million California homes at risk of foreclosure, this action was urgently needed.”

The California Homeowner Bill of Rights extends Attorney General Harris’ response to the state’s foreclosure and mortgage crisis. Attorney General Harris created a Mortgage Fraud Strike Force in March, 2011 to investigate and prosecute misconduct related to mortgages and foreclosures. In February 2012 Attorney General Harris extracted a commitment from the nation’s five largest banks of an estimated $18 billion for California borrowers.

More details about the California Homeowner Bill of Rights are found on the attached fact sheet.  To learn more about how the bills impact California homeowners, review the slideshow at: www.oag.ca.gov.

# # #

You may view the full account of this posting, including possible attachments, in the News & Alerts section of our website at: http://oag.ca.gov/news/press-releases/california-homeowner-bill-rights-takes-key-step-passage

 

CA Attorney General files suit in massive 17 state mortgage fraud scheme.

CA State Attorney General Kamala Harris sued Philip Kramer, the Law Offices of Kramer & Kaslow, two other law firms, three other lawyers, and 14 other defendants who are accused of working together to defraud homeowners across the country through the deceptive marketing of “mass joinder” lawsuits. Prominent foreclosure attorneys Phillip Kramer and Mitchell Stein and at least 17 others have been accused of luring desperate homeowners into the scheme using deceptive advertising and telemarketing schemes aimed at millions of people in California and 16 other states.

The scheme claimed that courts have found that most mortgage lenders engaged in predatory lending practices or approved inappropriate loans (well, that part is certainly true), and that the homeowners bank was one of the guilty. As alleged in the lawsuit, defendants preyed on desperate homeowners facing foreclosure by selling them participation as plaintiffs in mass joinder lawsuits against mortgage lenders. Defendants deceptively led homeowners to believe that by joining these lawsuits, they would stop pending foreclosures, reduce their loan balances or interest rates, obtain money damages, and even receive title to their homes free and clear of their existing mortgage. Defendants charged homeowners retainer fees of up to $10,000 to join as plaintiffs to a mass joinder lawsuit against their lender or loan servicer.

It probably comes as no surprise that theses same ‘prominent foreclosure attorneys’ had previously been ‘prominent loan modification specialists’ but it is alleged that Kramer sent an email to another fellow defendant last year stating “Only morons would prefer to ‘sell’ mods from this day forward”.
Homeowners who have paid to be added to one of the lawsuits should contact the State Bar if they feel they may be victims of this scam. They can also contact a HUD-certified housing counselor for general mortgage related assistance. If you have sent money to any of the following seized entities, you should contact the CA Attorney Generals Office at http://oag.ca.gov/.

The Department of Justice has seized the practices of the following non-attorney defendants: Attorneys Processing Center, LLC; Data Management, LLC; Gary DiGirolamo; Bill Stephenson; Mitigation Professionals, LLC; Glen Reneau; Pate Marier & Associates, Inc.; James Pate; Ryan Marier; Home Retention Division; Michael Tapia; Lewis Marketing Corp.; Clarence Butt; and Thomas Phanco as well as seizing the practices and accounts of attorney defendants:The Law Offices of Kramer & Kaslow; Philip Kramer, Esq; Mitchell J. Stein & Associates; Mitchell Stein, Esq.; Christopher Van Son, Esq.; Mesa Law Group Corp.; and Paul Petersen, Esq.

Attorney General Harris is challenging the defendants’ alleged misconduct in marketing their mass joinder lawsuits; her office takes no position as to the legal merits of any claims asserted in the mass joinder lawsuits filed by defendants.

Victims in the following states are known to have received these mailers, or signed on to join the case. This is a preliminary list that may be updated:

Alaska, Arizona, California, Colorado, Connecticut, Florida, Hawaii, Maryland, Massachusetts, Michigan, Missouri, Nevada, New Jersey, New York, Ohio, Texas, Washington.

For more information please go to: http://oag.ca.gov/news/press_release?id=2552

Jesus Christ Superstar Starts Final Weekend Run

The Temecula Valley Players production of Jesus Christ Superstar enters the final weekend of it’s 3 week run this Thursday, April 21 at the Old Town Temecula Theater. Some of you old Hippies will not doubt remember the debut of this exciting piece of musical theater from your halcyon days. For the rest of you, JCS was first staged on Broadway in 1971 as the first rock opera. Staged by Andrew Lloyd Weber with lyrics by Tim Rice,  the piece roughly follows the last week of Jesus’ life – provided of course that Jesus had a good voice and was surrounded by lots of singing, dancing Apostles, priests and hookers.

jcs

The Temecula Valley Players version is true to the original production and brings together a diverse collection of some of our Valley’s most talented thespians. For Director Marc McCullough, staging this production has been a lifelong passion. Jason Call, who channels Ted Neely as Jesus, first played a minor part in the
production when he was 14. Now some 24 years later he has achieved his dream to bring the lead role to the stage. Several of the other players have also had an abiding fascination with this unique piece of theater and have eagerly endured months of rehearsals to fine tune the production.

The cast of nearly 50 people includes youngsters of 7 and 8 years old up to a couple ‘senior members’ of nearly 60. Many of the actors are what we refer to as
‘triple threats’, they are equally adept at singing, dancing and acting. I am actually the antithesis of a triple threat in that I can’t really sing or act and I certainly can’t dance, but I do have a certain presence. Thus the role of High Priest suits me fine as foil to the scheming Annas and the evil Caiaphas.

priests

If you haven’t had a chance to catch this local production, tickets for the final 5 performances are gong fast but a few seats remain available. For more information and showtimes visit: Jesus Christ Superstar.

$40 political survival proposal – updated.

Many of you have commented on my earlier blog regarding the proposed $40 dues increase to fund the Realtor Political Survival Campaign. As you recall, that will be voted on in May at our annual meeting in DC. Yesterday we had a 1 1/2 hour webinar with NAR leadership discussing why the additional funding was necessary. At that time the possibility of putting the Public Awareness campaign on haitus for a couple years and using those funds for political purposes was presented as a sort of plan B. According to NAR stats however, that public awareness campaign is a great success – although most of you would just as soon it went away.

Anyway, for those of you opposed to an additional $40 hit on your dues, it appears your voices have been heard, Now you just need to make sure your local association and your NAR Directors are aware of your feelings.

From NAR President Ron Phipps:

To:        Local Board and State Association Presidents

This letter constitutes the official notice required by Article II, Section 10 of the Bylaws of the NATIONAL ASSOCIATION OF REALTORS® of a proposal to eliminate a previously approved membership assessment.

In May of 2010 the NAR Board of Directors approved an assessment of $35 per member for 2011-2013 to be used to continue the Public Awareness Campaign during those years.  The Finance Committee has now offered two alternative proposals regarding funding for the REALTOR® Party Political Survival Initiative.  One proposal eliminates the Public Awareness Campaign $35 Assessment for 2012 and 2013.  That proposal also increases NAR dues by $35 per year to fund the REALTOR® Party Political Survival Initiative.

The other proposal offered by the Finance Committee is being recommended by the NAR Executive Committee.  That proposal would increase NAR Dues by $40 per year to fund the REALTOR® Party Political Survival Initiative.  The Public Awareness Campaign $35 Assessment would remain in effect during 2012 and 2013.

Dues, membership assessments and amendments to membership assessments for the National Association are adopted by the Board of Directors of the National Association.  These issues will be coming before the Board of Directors at its meeting on May 14, 2011.

Sincerely,

Ron Phipps
2011 NAR President

Fannie & Freddie incentives for buyers & agents.

Fannie Offers Incentives for HomePath Properties
On April 11, 2011, Fannie Mae announced new buyer and selling agent incentives in connection with the sale of Fannie Mae-owned properties (HomePath properties).
A buyer of a HomePath property to be used as the buyer’s primary residence can receive up to 3.5% of the final sales price to be used toward closing costs.
A selling agent bonus is available in four states—California, Washington, Arizona, and Texas. In these four states, a bonus is being offered to selling agents who represent a buyer who will use the property as a primary residence. For properties in California and Washington, the selling agent bonus is $1,000. For properties in Arizona and Texas, the bonus is $500.
To qualify for either incentive, the buyer and, for properties in one of the four states, the selling agent must meet certain requirements, including the following. The buyer and selling agent incentive must be requested at the initial offer submission. The initial offer must be submitted on or after April 11, 2011, and the property sale must close on or before June 30, 2011. The buyer must use the property as a primary residence (auction, pool and investor sales are excluded). Check the HomePath website for more details. If you have questions, please CONTACT Jeff Lischer at 202-383-1117 or jlischer@realtors.org with any questions.

Update on Keep Your Home California Program

Update on the ‘Keep Your Home California’ program.

This $2 Billion program, announced a few months ago to great fanfare but little result, has determined it’s time to expand the programs due to it’s thus far limited reach. The program is designed for low and moderate income borrowers who refinanced their home, took out a home equity line of credit (HELOC), or are underwater on their loans and now find themselves in trouble (duh). The program features four separate sections to help these borrowers including one to get caught up on their loan, another to reduce their principle, one to provide relocation and transition assistance and one to subsidize payments to unemployed homeowners.

Administered from a federal grant by the California Housing Finance Agency, the programs director says they started slow by design. Before jumping in with both feet they wanted to guage the response, see what kind of people were applying and why they were not qualifying. The director expects the program ultimately to help 100,000 Californians.

Of course as I noted in an earlier post when the program was announced, the program is voluntary for lenders. Yeah, you read that right. Lenders will voluntarily agree to accept partial back payments or reduced principle for borrowers who took cash out of their homes during the boom times. Low to moderate income buyers, who are in financial trouble. Yeah, the banks haven’t demonstrated much pro-activity in helping anybody at all, let alone low to moderate income folks. I’m sure this will all work out fine. Even the director admits that ‘only some lenders are participating’. Go figure.

Oh well, I guess if we can keep 100,000 low to moderate income people in their homes here while other demographic groups are ignored by HAMP and HAFA and other bail-outs, that’s a good thing, eh?

Gov says drought is over – rates rise in celebration.

Governor: Drought is over.

What a great headline on the front page of our daily newspaper today. Accompanied by a photo of two goofs standing out in the snow with some 15′ long stick suspended from a ski pole measuring how heavy snow is. I don’t know – I guess it was meant to convince us the Gov. knows scientific stuff.

But the message was clear, our state reservoirs have reached such high levels after two years of rainy winters and plenty of snow up high that the drought declared in 2008 no longer exists. WhooHoo! The biggest reservoir in the system, Oroville Dam, is at 104% of its historical average, Shasta is at 111% of historical, our current snowpack is at 165% of normal. Even the Colorado River basins, Lake Mead,  Diamond Valley and others are filling up fast.

But wait – they remind us that conservation remains necessary because of the precarious condition of the Sacramento River Delta. Even though they’ve got all that water, a lot of it up north, doesn’t mean they will be releasing any more for us down south because it would still kill the little Delta Smelt – that 3 inch long good-for-nothing fish that gets sucked into pumps because it’s too stupid to swim away. Yeah, we still got that.

But even Southern California reserves are up – plenty of water for now. That means the 50%+ increases in price they’ve jacked onto us the past two years will stabilize? Maybe even drop a little since water is now plentiful? After all, the increases were to encourage conservation during the tough times and reduce our dependence on imported water.

And we’ve done that right?

Usage in San Diego County is down 20%, other areas are averaging between 15% and 43% reductions over the past 2 years. I mean, they beat us over the head with this. Gotta conserve. Low flow toilets, desert landscape, 5 minute showers,  if it’s yellow it’s mellow, if it’s brown flush it down, you name it, we’ve done it.  Heck I’m even drinking my whiskey neat because I don’t want to waste the water for mix or for ice.

We get that: Conservation = good. No conservation = expensive.

So now we get a break, right?

Yeah, I got your break right here, Pal. This is the part where you just have to appreciate the humor of the situation or you’re likely to go on a rampage with multiple dangerous weapons and a bad attitude. According to one water department spokehole, “all that water is a blessing and a bane.” A what? A bane you ignorant savages! Because now they have all this water but guess what? They’re not selling enough to cover their asses – I mean expenses. Honest to Jesus H, we’ll now be paying higher water bills because we’re not using enough. I believe judicious use of the ‘F’ word might be appropriate here.

Sounds like the oil companies. “Hey, they’re using too much gas, lets jack up the price to get them to conserve. Hey they’re not driving enough, we need to jack up the price to boost our profit. Hey, there’s a crisis in Libya, let’s jack up our price because we can. Hey, we don’t even need a good reason anymore, lets just jack up our price because….. Jackholes!

So we’ve got water flowing out the kazoo but we’re still scheduled for another 12.5% in rate hikes by 2012. It would appear that we’re damned if we do and damned if we don’t. If anybody can suggest a scenario out of this wherein the consumer actually wins a little, please feel free to suggest it.

Aw what the hell. It’s just California. Grab a little medicinal weed, go to the beach and forget about it.


Realtors! Please answer your Call for Action.

Stay Active. Answer the CFA!, Posted by Vince

Posted: 30 Mar 2011 07:18 AM PDT

Doctors consistently tell us that we can keep ourselves healthy if we stay active. Without consistent exercise, our health deteriorates.

It’s the same in politics. If REALTORS® continue to stay active on Capitol Hill, we can help bring our industry back to health and maintain its health. If our participation slides, our businesses slide.

We sent out a Call for Action on Monday to all REALTORS® on the mortgage interest deduction. It tells Congress not to trim the MID one bit. It also asks members of the House of Representatives to back House Resolution 25 which supports the MID in its current form.

We’ve already seen a strong participation rate on this one. But when we say we need “everyone” on board answering the Call for Action, we mean it. This is a serious issue that will affect homeowners, consumers, and every single REALTOR® in America.

There’s no association for home owners out there. There’s only us. NAR represents the 75 million home owners.

So it’s crucial that REALTORS® remain active and answer the CFA today. Now is your moment to let your member of Congress know what’s important to you.

If you need more convincing, check out the letter-to-the-editor on the MID in the Chicago Tribune from NAR’s Chief Economist. Do you think it’s a good time to ask homeowners to cough up another $3,050? I don’t either.

Thank you for your participation! I promise you, it’s making a big difference. — Vince Malta, 2011 NAR Vice President and Liaison to Government Affairs

Realtors® Oppose High Down Payment Requirement for Qualified Residential Mortgage Exemption

Washington, March 29, 2011

High down payment requirements being proposed by federal regulatory agencies as part of the upcoming rulemaking under the Dodd-Frank Wall Street Reform and Consumer Protection Act will unnecessarily burden homebuyers and significantly impede the economic and housing recovery, according to the National Association of Realtors®.

Six agencies, including the Department of Housing and Urban Development, Federal Deposit Insurance Corp., Federal Housing Finance Agency, Federal Reserve, Office of the Comptroller of the Currency, and the U.S. Securities and Exchange Commission, are developing a proposed risk retention regulation under the Dodd-Frank Act that requires lenders that securitize mortgage loans to retain 5 percent of the credit risk unless the mortgage is a qualified residential mortgage (QRM); FHA and VA mortgages would also be exempted. The purpose is to create strong incentives for responsible lending and borrowing.

“As the leading advocate for home ownership NAR supports a reasonable and affordable cash investment requirement coupled with quality credit standards, strong documentation and sound underwriting,” said NAR President Ron Phipps, broker-president of Phipps Realty in Warwick, R.I. “A narrow definition of QRM, with an unnecessarily high down payment requirement, will increase the cost and reduce the availability of mortgage credit, significantly delaying a housing recovery.”

NAR believes that Congress intended to create a broad QRM exemption from the 5 percent risk retention requirement to include a wide variety of traditionally safe, well-underwritten products. Congress chose not to include a high down payment among the criteria it specified in the Dodd-Frank Act to guide the regulators in defining a QRM. Strong evidence shows that responsible lending standards and ensuring a borrower’s ability to repay have the greatest impact on reducing lender risk.

“We need to strike a balance between reducing investor risk and providing affordable mortgage credit. Better underwriting and credit quality standards have greatly reduced risk. Adding unnecessarily high minimum down payment requirements will only exclude hundreds of thousands of buyers from home ownership, despite their creditworthiness and proven ability to afford the monthly payment, because of the dramatic increase in the wealth required to purchase a home,” said Phipps.

The definition of QRM is important because it will determine the types of mortgages that will generally be available to borrowers in the future. Borrowers with less than 20 percent down could be forced to pay higher fees and interest rates, up to 3 percentage points more, for safe loans that otherwise do not meet too narrow QRM criteria.

NAR is concerned that a narrowly defined QRM will also require severe tightening of FHA eligibility requirements and higher FHA premiums to prevent huge increases in its already robust share of the market, adding additional roadblocks to sustainable home ownership.

“Saving the necessary down payment has always been the principal obstacle to buyers seeking to purchase their first home. Proposals requiring high down payments will only drive more borrowers to FHA, increase costs for borrowers by raising interest rates and fees, and effectively price many eligible borrowers out of the housing market,” said Phipps. “We strongly urge the regulators to consider the negative consequences of setting onerous limits on the availability of credit.”

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.1 million members involved in all aspects of the residential and commercial real estate industries.

Liberty Quarry Final Environmental Impact Report is Released

The Riverside County Planning Department has released the Final Environmental Impact Report (FEIR) for Granite Construction’s proposed Liberty Quarry Project south of Temecula. At 8,500 pages, the document is easily half again as long as the draft EIR released last year. I haven’t slogged through the report yet but preliminary indication is that it backs up the draft EIR findings that Riverside County would benefit economically and environmentally from the proposed quarry location.

That will have no impact whatsoever on quarry opponents who argue that the blasting will disrupt the area, reduce property values, contribute to earthquakes, and produce clouds of deadly silica dust that will entomb our region. To say it’s been an impassioned argument over the past few years would be an understatement. Sadly, it has pitted neighbor against neighbor, city against county and logic against emotion more than once. The Letters to the Editor section of the local paper would dry up if not for the continual missives pro & con on this single subject.

I posted information on this two years ago after our Directors had visited another quarry site and the SDSU Preserve area adjacent to where the new quarry would be located. The Southwest Riverside County Association of Realtors® has not taken a position on the quarry project but has attempted to bring accurate information to our members so they have some background should they choose to make their own informed decision. You can get that background here:

Liberty Quarry & Private Property Rights

SDSU Showcases the Santa Margarita Watershed

Public hearings have been scheduled for the project on April 26 and May 3 at Rancho Community Church (31300 Rancho Community Way) in Temecula starting at 4 pm.

The report is available for your perusal at: Liberty Quarry Final EIR

Few will actually read it, everybody will be quoting the ‘facts’ as they interpret them. And no matter which side prevails in the County’s final decision, we may be assured this will tie up the courts for several more years. Some people have more solid granite between their ears than would be mined from the Liberty Quarry in the next 75 years.

Attack!

NAR Realtor Party Political Survival Initiative – A Penny for your Thoughts.

It’s entirely probable you’ve heard about the new NAR Realtor® Party Political Survival Initiative introduced at the AE Institute this past Sunday. While NAR has not made a broad announcement of the program yet, our AE’s are returning from their meetings this week with information on the initiative and word has been getting out from Inman, from the blogs, and of course on Realtor.org itself.

According to NAR, the initiative was launched partially in response to last years Supreme Court decision, the celebrated Citizens United Case. As forecast, that decision stands as a game changer in the lobbying world granting corporations the same rights as individuals to contribute to political campaigns. The price of doing business has just gone up and if you want to stay at the table with the serious players, you’d better step up your game.

That’s what NAR is proposing by instituting a mandatory $40 dues increase effective 2012. The issue will be voted on at NAR’s Mid-Year Legislative meetings in May.

The following is a post by NAR stating their reasons for launching the initiative. I would encourage you to read it. I have also included the slide show presented to our AE’s in Dallas this past Sunday. I have no doubt this will be hotly debated as we approach our May meetings and I encourage you to make you opinions knows to me, to your local associations as well as your state and NAR Directors. Make sure to note that 2/3 of the funds raised will be channeled back to your state and local associations for local purposes.


Why did NAR create the REALTOR® Party Political Survival Initiative?
•  In January of 2010, the Supreme Court ruled in the case of Citizens United vs. the Federal Election Commission.
•  The ruling states that corporate dollars—so-called soft dollars—can be used to fund independent expenditure campaigns.
•  This not only changes the way elections are financed at the national level, but it also overturns restrictions that allowed only hard dollars—those funds contributed for political purposes by individuals, rather than corporations—to be used in 23 states.
•  This means political fundraising as we have known it for the past 100 years just shifted dramatically.
•  Corporate funds/dues can now be used to shape opinions about candidates in ALL 50 states.
•  It is a game changer of gigantic proportions.
•  It is as if the goal posts on a 100 yard football field were expanded to now cover 140 yards.
•  In order for “The Voice for Real Estate” to have the impact it has had for the past 100 years in terms of political advocacy, the REALTOR® organization is stepping up its game.
•  No one has spoken with more power or as passionately about protecting private property rights and fighting for opening the door to the American Dream of Home Ownership than the REALTOR® Family.
•  To maintain and grow our political power in this new landscape, NAR launched the REALTOR® Party Political Survival Initiative.
•  The REALTOR® Party Political Survival Initiative did not just happen overnight.
•  It was the result of nearly a year of careful study and consideration.

What does the REALTOR® Party Political Survival Initiative mean for members?
•  The proposal is for a dedicated dues increase of $40.00.
•  The increase would take effect in the 2012 budget year.
•  Because it is “dedicated” to this initiative, it would be used exclusively to fund political advocacy efforts.
•  In the past, NAR has already contributed funds to this initiative out of its operating budget.
•  But to undertake the initiative at this level and give it a best chance for success, greater additional funding is needed.
•  The increased dollars will be dedicated solely to advocacy purposes as outlined by the Political Survival Initiative.
•  If this dues increase is approved, over 50% of NAR budget would be devoted to political advocacy, which consistently ranks among members as the #1 benefit they receive from NAR.

What are the benefits of the Political Survival Initiative?
•  The most powerful benefit is it will keep the REALTOR® organization as one of the most influential advocacy groups in America.
•  There are monumental issues coming down the pike that will affect members in their daily businesses, such as the future of mortgage finance and keeping housing affordable in America.
•  We must have the power to shape this pivotal moment for the American Dream of Home Ownership.
•  Most importantly, these dollars will be available to state associations and local boards.
•  2/3rds of the dollars raised will be returned back to states to be used in support of local candidates and issue campaigns, and for other political advocacy needs—to help shape the opinions of candidates on real estate-related issues as they work their way up as elected leaders.
•  It will combine NAR funds with state/local funds to increase our political power
•  It will create early relationships with state and local lawmakers/policymakers
•  It will shape the political make-up of state or local governing bodies.
•  NAR President Ron Phipps often comments that “now is our time.”
•  With this initiative, REALTORS® are seizing the moment for home ownership.
•  We are doing this NOT ONLY because of the Citizens United Supreme Court decision, but because our core competency is our grass roots advocacy; it’s where we need to be investing today so our future advocacy efforts will be successful tomorrow.
•  We need to be grooming our “REALTOR® Champions” at the state / local levels now, before some of them progress to become elected leaders at the federal level.
•  The political press in Washington has already noted the emerging clout of the REALTOR® Party.
•  A recent article in Politico said: “REALTORS®… are going to want to be politically effective, and a large measure of their influence is that they are present everywhere.”
•  Now is our time to seize the day.

It’s the Spending, Stupid

By Jon Coupal

“Government is like a baby,” Ronald Reagan was fond of saying. “An alimentary canal with a big appetite at one end and no sense of responsibility at the other.”  If the former California governor were observing Sacramento today, he would probably add that our state government functions more like “triplets,” and has been doing so for more than ten years.

Back at the beginning of the millennium, the California treasury was overflowing due to capital gains tax receipts from what has become known as the “dot.com bubble.”  Almost everyone in the state understood that these tax producing profits were the result of a short-term business cycle, and the excessive flow of tax revenue would not be a permanent condition.  Unfortunately, there were a small group of Californians who did not understand these basic economic principles, including the majority in the state Legislature and Governor Gray Davis.

These officials responded to the increased revenue by spending it all and committing Californians to pay for expensive long-term programs, like radically increased pensions for government workers, that now have state and local governments facing nearly a half-trillion dollars in unfunded liabilities.

This profligate approach to governing was a contributing factor to the successful recall of Davis.  However, governor Schwarzenegger, and the party-hearty lawmakers that continued to dominate the Legislature carried on like there was never a problem.  When the state came up short, they used accounting gimmicks that allowed them to carry on spending as if there were no tomorrow.

Between 2003 and 2007, spending increased by one-third.  Then the housing bubble burst, and these same suspects imposed the largest tax increase in the history of all 50 states.  They had learned their lesson, they said, and pledged to taxpayers they would use the two years of massively higher taxes to buy time to reorganize and reform their spending ways.  Two years later, and in spite of California families having paid about two-thousand dollars in extra taxes, the state is now facing a $26 billion shortfall.  The “spendaholics” have fallen off the wagon, again.

All of this could have been avoided if the malefactors, who clearly lack self-control, had been compelled to work under a hard spending cap.

Because the politicians that control the Legislature and our current governor – the Department of Finance shows that Governor Brown’s budget will grow 31% by 2015 – are still in a state of denial regarding spending, there is an urgent need to take measures to restore a strict spending limit on state government.

This is why Senator Tony Strickland has introduced Senate Constitutional Amendment No. 10, sponsored by the Howard Jarvis Taxpayers Association, that would impose a firm spending cap on lawmakers.  The expenditure limit includes General Fund and special funds, and contains no exemptions for education or local government funding.  It creates a reserve of up to 10% of spending; this reserve can only be tapped to backfill revenue shortfalls in the current budget year and to fund non-fiscally related emergencies.  Funds could only be used by a Declaration of the Governor and two-thirds vote of the Legislature.  Half of the excess revenues beyond the 10% cap would be used to pay off existing debt.

Back when Bill Clinton was running for president, a big sign that read, “It’s the economy, stupid” was placed on his campaign office wall.  In an ideal world every member of the Legislature would be required to post a sign on their office wall that said, “It’s the spending, stupid.”  Sen. Strickland’s SCA 10 is the taxpayers’ way of sending this message.

Short Sale Webinar Presented by Bank of America

Join us on March 23 at 1 p.m. or March 24 at 10 a.m. for a free webinar on Bank of America’s Cooperative Short Sale Program.  Bank of America will be rolling out its new program for expediting short sales, as presented by B of A’s Consumer Credit Executive Kimberly Dawson.  Topics to be covered in this one-hour session include:
How cooperative short sales will expedite the short sale process;
What the agent’s role will be;
Whether B of A will pay relocation assistance; and
Who the agent can contact for assistance or to escalate the process.
Space to attend this webinar may run out very quickly, so register now at http://www.car.org/education/webinars/bofawebinars/.  Once you have registered, you should immediately receive a confirmation email, which you will need to join the webinar on March 23 or 24.  If you have any questions, please contact C.A.R.’s Special Projects Coordinator Lindsey Moss at (213) 739-8217 or email her at lindseym@car.org.

MID Under Attack Soon? Watch your email inbox.

The Mortgage Interest Deduction (MID) may be under attack again.  As the 112th Congress struggles to finalize a budget plan for this year, everything is back on the table.  House Speaker John Boehner (R-OH) recently stated that MID for second homes is becoming harder and harder to justify in these
difficult times.  So might be the MID for homes greater than $500,000.

Now is the time for REALTORS® to act!  On March 28, an all member Call for Action (CFA) will be launched.  This CFA will ask REALTORS® to contact their House Members to urge them not to touch the MID in any legislative or budget proposal.  It will also urge them to sign on to H.Res. 25 expressing
the sense of Congress that the current Federal income tax deduction on interest paid on debt secured by a first or second home should not be further restricted.

First, be on the lookout early next week for the CFA (either from your broker or from NAR).  Second, respond immediately to the CFA.  Third, spread the word and ask your colleagues to respond too.  Any House budget action will be quick.  MID is on the line.  Now is not the time to sit back and let
someone else make the decisions.

War Games – Gov. Browns Budget Vote Scheduled today.

War games

Mar 16, 2011
Tensions in the Capitol increased dramatically as the first floor votes loomed on a budget crafted by Gov. Jerry Brown and majority Democrats. But as the negotiations intensified, the voice of the people — a cliche, but a nice cliche — was heard: Most Californians want a chance to vote on the budget, a new poll shows.

From the Chronicle’s Wyatt Buchanan: “A strong majority of California voters want a special election and support Gov. Jerry Brown’s plan to shrink the state budget deficit by extending temporary tax increases for five more years, according to a survey by UC Berkeley and the Field Poll. Most California voters, however, would not support paying new or higher taxes to help close the state’s $26.6 billion deficit.”

“The poll showed 61 percent of all voters surveyed said they were in favor of calling a special election, and 56 percent of Republican voters surveyed said they wanted that, too. However, most of the Republicans – 61 percent – said they would vote against the tax proposal.”

More from the poll: About nine out of 10 lawmakers are either conservative or liberal, but only about half of Californians fall into those cagtegories, notes the Bee’s Dan Walters.

“That’s another way of saying that the state’s moderate Democrats, centrist Republicans and independent voters – half of the electorate – have only scant representation in the Capitol.”

“The stark contrast between the political dynamics inside the Capitol and the reality outside its impervious granite walls is one of the major impediments to timely and effective political decision-making. Those inside the building engage in ideological gamesmanship. Those outside just want politicians to do their jobs, even if that requires compromise.”

The eternal push by some Republicans to rewrite the state’s principal environmental law, the California Environmental Quality Act, is gaining new momentum as five Republicans are demanding CEQA changes — the same Republicans whose votes Brown is courting for the state budget.  The LA Times’ Shane Goldmacher and Evan Halper have the story.

“Sweeping changes in the California Environmental Quality Act would stand little chance of approval through the normal legislative process, which Democrats — environmentalists’ usual allies — control. But the governor’s budget cannot pass without some Republican votes, and GOP lawmakers see an opportunity to win long-sought concessions.”

“Environmentalists expressed outrage at the Republicans’ bid. Bill Magavern, director of Sierra Club California, said that what the legislators want amounts to a “wholesale gutting” of the law.”

FHA’s Stevens Departs for MBA Greener Pastures

stevens

In the past I have written favorably about FHA Commissioner David Stevens. I even got a comment on one blog from Stevens thanking me for my post. I’ve attended several talks by Stevens, a couple webinars and phone chats, etc. I like Dave – think he’s done a good job keeping the FHA out of bail-out territory, adjusting some  policies – like the 90 day flip rule, etc.

Well, the end of this month what will be a big loss for the FHA will become a big gain for the Mortgage Bankers Association when David Stevens leaves the former for the latter. I don’t know if I will like him as well in the new position but hope he can bring the same clarity and focus to the MBA that he has brought to FHA and that his knowledge of a broad spectrum of the market from several perspectives will be put to good use.

Stevens joined the administration team at FHA as one of President Obama’s new hires and has usually been perceived as a straight shooter knowledgeable of the industry whereof he governs. The same could  not always be said of his bosses HUD Secretary Shaun Donovan or FDIC Chair Sheila Bair. Stevens, while toeing the company line, could also be candid in appraising some of the constraints of working within the administration, explaining why things were the way they were and what the impact and repercussions to the industry would be. Donovan and Bair can always be counted on to spout the strict company line regardless of whether you call BS on them or not. I always found him a refreshing fresh voice amidst the sea of blather.

He joined the administration after serving as President and COO of real estate firm Long & Fosters but he has an even more extensive background as a  mortgage lender at World Bank and Wells Fargo and a seven year stint running the small lender channel at Freddie Mac.

No word yet on who will be tapped to replace Stevens at the helm of the FHA when he  leaves at the end of the month. One can only hope that an equally competent and focused individual will be named, someone who knows what business they’re in, actually understands housing, lending and how they impact the economy and can work to keep the FHA a relevant entity for first time and lower income homebuyers.

Thanks Dave. We’re wishing you the best. If you can do the same kind of job at MBA you did at FHA the housing industry as a whole will benefit from it. Good luck.

Redevelopment Agencies are wrong places to cut

I’ve been writing about this since Gov. Brown stated his intent to do away with local redevelopment agencies and distribute the money from local agencies to hi8s statewide projects. Sure there are some cities around the state that either aren’t using the funds or are misusing the funds but many are not and they have done a world of good. Look at downtown Temecula. Look at the Gaslamp in San Diego. Without redevelopment, the Gaslamp would still be the slum it was not that long ago.

An article appeared in today’s Californian that adds the housing element to the mix. Redevlopment has provided over 91,000 affordable housing units since 1995. For every 100 units created, 125 local jobs are created and 32 permanent jobs. Some in Sacramento just don’t get it – they are actively trying to kill what’s left of the housing industry not understanding that housing speeds an economic recovery, housing is a jobs engine which our state desperately needs.

Click here to view the forum post: Wrong places to cut.

Don’t Kill California’s Recovery

Posted by Former California Congressman George Runner in the Fresno Bee. Why can’t people understand this most simple concept?

Don’t kill California’s recovery

Posted at 12:00 AM on Tuesday, Feb. 15, 2011

By George Runner
With jobless numbers still at record highs, it wouldn’t be right to declare California’s economic downturn over anytime soon. Even so, glimmers of hope are beginning to emerge that the Golden State is inching its way toward economic recovery.

Let’s hope the politicians don’t mess it up.

In his recent State of the State address, Gov. Jerry Brown said “we will not create the jobs we need unless we get our financial house in order.”

Unfortunately the governor’s proposals to put California’s financial house in order are starting to look more like a wrecking ball than a rescue plan.

His budget proposes billions of dollars in taxes on the private sector — the very folks he wants to create more jobs.

It may seem like a distant memory, but merely two years ago, a different governor and Legislature tried taxing their way out of a similar budget mess. Since then California has lost more than half a million jobs and our state’s unemployment rate has grown by 20%.

We clearly don’t need an empirical study to tell us that tax hikes don’t create jobs.

Even so, Gov. Brown is proposing to extend these very same tax increases for five more years. If approved, Californians will pay $45 billion more in income taxes, sales taxes, and vehicle taxes.

On top of this, the governor is proposing to eliminate a number of tax incentives that currently encourage businesses to create and retain jobs in our state.

Under his proposals, private sector employers, including many small businesses, would pay more than $2 billion in retroactive taxes this year and increased taxes for years to come.

The governor calls his budget solution a “balanced approach” since it includes both tax increases and cuts. But in reality, his approach is anything but balanced.

A balanced approach would recognize that the private sector has been devastated by the economic downturn-more so in California than other states. In the past three years, more than one million private sector workers have lost their jobs.

During that same time period, guess how much state employment shrunk?

It didn’t.

According to the latest Employment Development Department numbers, state employment actually grew by 1,200 jobs. We now have 489,000 state workers-nearly half a million-whose wages and benefits are paid by a private sector that is a million workers smaller.

And now the governor is asking the private sector to step up and pay even more to protect those state workers’ paychecks.

Does that seem balanced to you?

To be clear, I’m not saying I want state workers to lose their jobs. I wouldn’t wish that on anyone. My point is simply that private sector workers provide the tax dollars that allow state government to pay its bills, including the paychecks of state workers.

California currently has the second highest unemployment rate in the nation. Our elected leaders could have responded aggressively months-even years-ago to protect California jobs and improve our state’s dismal business climate, but they didn’t. It’s only fair that government shares the pain.

California’s real problem is jobs, not revenues. When jobs are plentiful, government always has plenty of revenues. When jobs are scarce, as they are now, government revenues dry up.

Solve the jobs problem, and you’ll solve California’s budget problem — not to mention a few other problems as well.

George Runner represents more than 9 million Californians on the state Board of Equalization. For more information, visit www.boe.ca.gov/Runner< h6

Read more: http://www.fresnobee.com/2011/02/14/2272658/george-runner-dont-kill-californias.html#ixzz1EG8IYuQP