Today is the 161st anniversary of California being admitted into the United States. California became the 31st state in the union. There will be Admission Day celebrations at the Capitol today in Sacramento.
The California Legislature continues in session today and hopes to wrap up its work by the end of business. However, there are talks of a special session.
On to today’s headlines…..
The Assembly Thursday night approved a sweeping package of tax reforms that Gov. Jerry Brown said will save Californians and small businesses more than $1 billion a year.
The proposal, negotiated by the Democratic governor and Republican Assemblyman Nathan Fletcher of San Diego, faces an uncertain fate in the state Senate as lawmakers wrap up their session for the year Friday.
The measure was approved 54-10, the bare minimum needed for two-thirds approval.
Brown and Fletcher earlier in the day appeared together at a news conference to announce the plan.
The complex measure proposes to trim four different business taxes and lower the personal income tax bills for millions of Californians.
To accomplish that, the proposal would raise taxes by an equal amount by modifying an obscure tax break used mostly by out-of-state companies.
Billed as a jobs-creation plan, the proposal would require companies to base their corporate taxes only on the share of sales in California, raising about $1 billion. That money would fund the business and personal tax breaks.
On average, California couples would save $100 a year on their income tax bills. Small businesses, depending on their circumstances, could save up to $500 annually.
Here’s how, according to Brown’s Department of Finance:
• An increase in the standard income deduction for individual Californians of $1,000, and $2,000 for couples, saving taxpayers an extra $306 million a year. It would save the average individual about $50 and couples $100 annually.
• A reduction in the corporate tax rate of one-half a percent for the first $50,000 in taxable income, saving the average company a maximum $250 and businesses statewide $18 million a year.
• A 10 percent exemption for the first $50,000 in for small businesses that file as personal income tax payers, saving them a maximum $500 each or $255 million combined.
• A $50 annual reduction in the minimum tax all companies, lowering that bill to $750 and saving those firms $59 million statewide.
• A new sales tax exemption when buying manufacturing equipment. Startups less than three years old would not pay the state’s existing 4 percent tax. Established business would be taxed at 3 percent.
But some out-of-state businesses will pay the price: $1.1 billion in higher taxes.
The controversy centers over what Brown calls a “toxic tax loophole” that provides a tax break for some corporations that produce goods and hire workers elsewhere but ring up big sales in California.
The new proposal would require that corporate tax bills be based solely on the percentage of sales in California. Currently, companies have either that option or can include the costs of payroll and property outside the state in their tax calculations. That latter policy provided tax incentives to companies to locate elsewhere, critics like Brown say.
A California fight over online sales taxes could now escalate nationally on Capitol Hill, pitting Amazon and other big retailers against skittish lawmakers accustomed to stoking anti-tax sentiments.
Under the emerging deal concocted in Sacramento, Amazon would join with brick-and-mortar competitors to lobby Congress for a national online sales tax law. In exchange, California would suspend enforcement of a new Internet sales tax until September 2012.
Amazon and the other companies are motivated and politically muscular, accustomed to deploying lobbyists, campaign contributions and all the tools of wielding influence. Still, their road ahead will be rough.
“The odds of getting a tax increase of any sort through this Congress, at the moment, are zero,” University of California, Berkeley, political scientist Bruce Cain said Thursday.
Action this year is unlikely, because of the unfinished legislative business already confronting Congress. Next year will be tricky, because of the presidential and congressional elections.
If formally approved by California state legislators, the handshake deal struck Wednesday does not actually require imposition of a federal online sales tax. Instead, the Capitol Hill lobbying focus likely would be legislation authorizing states to require that all retailers collect sales taxes.
Currently, only sellers with a physical presence in a state, such as a store, office or warehouse, are required to collect that state’s sales tax. But when the Supreme Court laid down that interpretation of the law in 1992, in a case arising out of North Dakota, justices also made clear that Congress could change the rules of the game.
The state Senate acted Thursday to prohibit California handgun owners from openly carrying their weapons in public, siding with law enforcement officials who say it wastes their time responding to false alarms of armed suspects and creates a risk of confrontation.
Current law allows the open carrying of unloaded handguns in public, and many activists have exercised their right by showing up in large numbers at their local Starbucks or other public places, wearing their firearm in a holster. Sen. Kevin DeLeon (D-Los Angeles) said there is no reason for that to happen in 2011.
“This is not the wild west,” DeLeon said during the floor debate. “How discomforting can it be if you walk into a restaurant, a Starbucks, a Mickey D’s and all of a sudden you see someone with a handgun?”
But Republican lawmakers said the proposal would infringe on their constitutional rights. “Don’t turn law-abiding citizens into criminals,” said Sen. Joel Anderson (R-San Diego). “The more we chip away at our ability to protect ourselves, it’s undermining our freedoms.”
Assemblyman Antony Portantino (D-La Cañada Flintridge) said he introduced the bill at the request of police chiefs and sheriffs who are concerned about the activity.
“They are tied up dealing with calls from the public about gun-toting men and women in the coffee shop,’’ Portantino said. “As law enforcement officials tell me, it’s not safe and someone is going to get hurt.”
However, Sen. Ted Gaines (R-Roseville) said he has never received a complaint from a constituent about people carrying guns openly, and many feel they need the protection. “This, in my mind, is just over the top,” Gaines said of AB 144. “It’s unnecessary.”
A utility worker doing maintenance near Yuma, Ariz., triggered a massive blackout that jammed roads, closed schools and businesses, grounded planes and left more than 4 million people across a large swath of Southern California and Mexico without power.
The blackout Thursday brought routine life to a halt. Many offices closed, but workers endured gridlock getting home because traffic lights were out. Officials said they noticed an increase in fender-benders in some areas as drivers tried to navigate the roads.
People were trapped in elevators and on rides at Sea World in San Diego and Legoland in Carlsbad. Hospital emergency rooms switched to backup generators, while outgoing flights from San Diego were canceled for several hours.
Customers jammed those stores that remained open, stocking up on ice and candles as utility company officials warned that power may not be restored until late Friday. Officials canceled classes Friday at most colleges and schools in San Diego and surrounding communities.
“Get ready to be in the dark. Get your emergency precautions ready,” said Michael Niggli, president and chief operating officer of San Diego Gas & Electric.
The blackout was triggered by a mishap on a high-voltage power line linking Arizona and San Diego, causing a cascading series of electrical grid failures stretching into Southern California.
APS, which is Arizona’s largest electric utility, said a worker was doing maintenance on lines at a nearby substation when the blackout occurred.
“The outage appears to be related to a procedure an APS employee was carrying out in the North Gila substation,” an APS spokesman said in a statement. “Operating and protection protocols typically would have isolated the resulting outage to the Yuma area. The reason that did not occur in this case will be the focal point of the investigation into the event, which already is underway.”
Enjoy your morning!