On politics in the Golden State

Category: Bill Lockyer

Your bill for California's debt: $2,559

 State Treasurer Bill LockyerThe golden rule in state government used to be that if more than 6% of the budget was being consumed by paying back bonds and other debt, there was too much borrowing going on.

It’s been some time since California hit that target.

On Monday, State Treasurer Bill Lockyer released the latest report detailing the state’s debt and outlook for the future. It’s going to be expensive.

Paying down the state’s ever growing credit card bill ate up 7.9% of the state budget in the fiscal year that just ended. California is on track to spend 8.9%, or about $8.6 billion, of the state general fund budget in the current fiscal year.

An easier way to digest the numbers is in terms of how much debt that amounts to for each Californian. The answer? A lot.

The Wall Street credit rating agency Moody’s says paying down the state government debt accumulated to date will cost each of us $2,559.

The only Americans facing a bigger payback are New Yorkers. Each of them owes $3,208.

Lockyer didn’t dwell on these numbers in his report, which is used by Wall Street to help judge the state’s creditworthiness. Instead, he noted some of the actions legislators and the governor took to start chipping away at the problem. Rolling back pensions, for example, will not get the state out of the woods, but it could save billions of dollars in the long run. 


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Photo: State Treasurer Bill Lockyer, shown in 2010, released a report detailing the state’s debt and outlook for the future. Credit: Armando Arorizo / Bloomberg

Treasurer Lockyer's estranged wife arrested on drug charges

Nadia Lockyer, then Nadia Davis, on the Santa Ana school boardA former Bay Area supervisor Nadia Lockyer -- who has struggled publicly with substance-abuse problems that led her to resign earlier this year -- faces criminal charges in Orange County following her arrest on suspicion of possessing and being under the influence of drugs, law enforcement officials said Wednesday.

Nadia Lockyer, the estranged wife of the state treasurer Bill Lockyer and an Alameda County supervisor until April of this year, was arrested by the Orange Police Department on Aug. 28, after law enforcement received a call from a tipster saying she was in possession of drugs, said Farrah Emami, a spokeswoman for the Orange County district attorney's office.

When police went to a home where Nadia Lockyer was living with her 9-year-old son, police found she was in possession of methamphetamine and saw "objective signs" that she was under the influence of the drug, Emami said.

Police also found drug paraphernalia, including an opium pipe and tubular aluminum foil with a burned end, according to the criminal complaint.

Nadia Lockyer is a native of Orange County and a former trustee for the Santa Ana Board of Education, elected in 1998. Lockyer resigned her position in Alameda County amid a months-long drug and sex scandal.


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-- Rick Rojas, in Orange County

Photo: Nadia Lockyer, then Nadia Davis, when she was on the Santa Ana school board. Credit: Los Angeles Times.

Treasurer Lockyer files for divorce after months of controversy

     Treasurer Lockyer files for divorceCalifornia Treasurer Bill Lockyer has filed for divorce from his wife, former Alameda County Supervisor Nadia Lockyer, after a tumultuous period during which she spent time in rehab and made allegations about being beaten by an ex-boyfriend she met at a motel.

The treasurer, 71, filed the papers Friday, citing "irreconcilable differences" in seeking to divorce his 41-year-old wife. They have a 9-year-old son.

"Above all he wants the matter resolved in a way that serves the best interests of his son," said Tom Dresslar, a spokesman for the treasurer. "Second, he wants it handled as privately and as amicably as possible."

At 5:10 p.m. Friday, after the divorce papers were filed, Nadia Lockyer was involved in a car accident near the couple’s home. Hayward Police Sgt. Eric Krimm said she was the sole occupant of the car when it knocked down a light pole before hitting a tree.

The cause of the accident was determined to be inattention to driving because of cellphone use, Krimm said, adding that Nadia Lockyer was taken by ambulance to a hospital for treatment of minor cuts and bruises. He said there was no indication of drugs or alcohol being involved.

Nadia Lockyer resigned from the Alameda County Board of Supervisors in April after a series of controversial incidents. In February, she alleged she was assaulted by her former lover, Stephen Chikhani, in a motel room in Hayward. At the time, she also said she had undergone rehabilitation for substance abuse.  

Later, an email from Nadia Lockyer's account alleged that her husband had gotten her addicted to drugs, but she later said that Chikhani had hacked into her personal email and added the allegation, which her husband's office unequivocally denied.


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-- Patrick McGreevy in Sacramento

Photo: State Treasurer Bill Lockyer, pictured, has filed for divorce from his wife, former Alameda County Supervisor Nadia Lockyer. Credit: Jamie Rector / Associated Press 

State treasurer's wife admits she accused him of supplying drugs

GetprevThe wife of California State Treasurer Bill Lockyer admitted in an interview with the San Jose Mercury News that it was she -- and not an ex-boyfriend who she alleged hacked into her email -- who accused her husband of supplying the drugs that kicked off an ugly sex and narcotics scandal.

Nadia Lockyer had sent an email, later released publicly, alleging that Lockyer provided the substance that started a painfully public passage through recovery. The state treasurer's office categorically denied the charge. Nadia Lockyer contended that a former lover she accused of assaulting her in a Northern California hotel had hacked into her email to make that assertion.

In the interview with the San Jose Mercury News late last week, Nadia Lockyer, 41, backpedaled. "It did come from me and I made the mistake of regretting sending it," she told the Mercury News. "I ask the public not to hold anything against my husband for actions that happened a long time ago."

She also alleged that her husband, during an argument in February, told her to "go ahead and commit suicide," which is what led her to the hotel where she alleged she was assaulted.

Tom Dresslar, a spokesman for Lockyer, said the drug allegations were "100% false. It was false when we didn't know who said it and it's still bs."

He added that the night of the purported suicide remark, "both of them -- stress on both -- said hurtful things they both regret."

Bill Lockyer, 70, is a titan of state Democratic politics and a former state attorney general. His wife is an attorney who recently resigned from her seat on the Alameda County Board of Supervisors.


Lockyer's wife resigns in sex, drug scandal

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-- Nicholas Riccardi

Lockyer's wife quits Alameda County board in drug, sex scandal

GetprevCAZVUDSQThe wife of California Treasurer Bill Lockyer on Friday said she will resign from the Alameda County Board of Supervisors amid a months-long drug and sex scandal that included a confession to spending time in rehab and increasingly dramatic allegations about her ex-boyfriend and her husband.

Nadia Lockyer, 40, told the San Jose Mercury News, "The public deserves and wants some answers and is tired of hearing about me and all this drama."

In February, she said she was assaulted by her former lover, Stephen Chikhani, in a motel room in Hayward. She also confessed to undergoing rehabilitation for drug and alcohol abuse.

A series of additional allegations peaked last month when an email from Nadia Lockyer's account alleged that her husband, a former state attorney general, had gotten her addicted to drugs.

She later alleged that Chikhani had hacked into her personal email and added the allegation, which her husband's office unequivocally denied.

Chikhani's lawyer denied that his client had accessed Nadia Lockyer's email.

An attorney who once worked for the Alameda County district attorney's office, she has a son with her 70-year-old husband. Bill Lockyer is a fixture in state politics who has been exploring a run for state controller in 2014.


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-- Nicholas Riccardi

Photo: Alameda County Supervisor Nadia Lockyer at a meeting. Credit: Jane Tyska/Bay Area News Group


State Treasurer Lockyer quits pension advisory panel in protest

The debate over pension reform in California reached a boiling point Tuesday.

State Treasurer Bill Lockyer resigned from a pension advisory panel to protest a study it was affiliated with that called for reducing retirement benefits for current public employees and overhauling the boards that oversee the public pension systems.

The study was issued by the Stanford Institute for Economic Policy Research and authored by Stanford public policy professor and former Democratic Assemblyman Joe Nation. It warned that the worsening finances of public pension systems in California would continue to squeeze state budgets unless there were significant changes.

In quitting the institute's pension advisory panel, Lockyer said he questioned the conclusions and methodology of the study.

“When it comes to public pensions, maybe SIEPR should stand for 'Stanford Institute to Eviscerate People’s Retirement,' " said Joe DeAnda, the treasurer’s press secretary. Lockyer said the study did not adequately consider the legal impediments to reducing benefits for current employees and ignored  research indicating that retirement systems perform better when their boards include members of the retirement plan.

Nation said public pension systems need more dramatic changes than those proposed recently by Gov. Jerry Brown. "Although it offers many positive elements, Governor Brown’s proposal provides only modest additional cost savings,'' the study said.


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-- Patrick McGreevy, reporting from Sacramento



Kamala Harris hires new chief of staff

Atty. Gen. Kamala Harris has a new chief of staff -- Nathan Barankin, who most recently served as communications director for state Senate leader Darrell Steinberg (D-Sacramento).

In Barankin, Harris gets a seasoned Sacramento hand with experience in the attorney general's office. He spent 10 years under Bill Lockyer and then Jerry Brown before joining Steinberg's staff three years ago. Barankin will replace Terri Carbaugh, who served as Harris' chief of staff for the first months of her tenure.

Barankin's old job will be filled by Steinberg spokeswoman Alicia Trost, who will be promoted to job of communications director.


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-- Anthony York in Sacramento

State treasurer warns IOUs could loom in April, May [Updated]

State Treasurer Bill Lockyer warned Saturday that California could face the unwelcome prospect of issuing IOUs in April or May if legislators and Gov. Jerry Brown do not act quickly to solve the state's fiscal problems.

The severity of California’s yawning budget gap, estimated at $25.4 billion, is widely known. But Lockyer’s comments, at a conference at UC Berkeley, were the first to suggest that the state government is staring at a more immediate cash crisis that could require IOUs.

The state last issued billions of dollars in the worthless scrip in 2009, causing a cascade of headlines around the world about the California’s fiscal dysfunction.

Lockyer, a Democrat, offered a clear prescription to avoid repeating that fiscal calamity: "Get a budget adopted that's honest, and make the cuts as soon as possible."

Brown, who took office less than three weeks ago, has called on the Legislature to enact by March 1 an austere spending plan that includes deep cutbacks to welfare, healthcare for the poor and the state's universities, among other programs.

"Get it done, the sooner the better," Lockyer said Saturday during his appearance at a conference sponsored by the Institute of Governmental Studies. If not, he said, "We will run out of money to pay the bills."

Brown and state Controller John Chiang, who is charged with paying the state's bills, have yet to outline so dire a scenario. "I am not supposed to say any of this," Lockyer admitted.

Steve Glazer, a top Brown advisor who was at Saturday’s conference, declined to comment on whether IOUs could be on the horizon. He referred questions to the Department of Finance, where officials were not immediately available. Chiang's office did not return a call for comment.

[Updated, 4:30 p.m.: Finance spokesman H.D. Palmer said California, if no actions are taken, will face a cash shortfall in July. But measures to conserve cash would have to be taken earlier -- "well before July," Palmer said –- to avoid the crunch. Examples include IOUs and deferring tax refunds for residents, he said. "None of these are pleasant options."]

Asked if the governor was concerned about IOUs, Glazer said, "There are a lot of consequences of not having a balanced budget plan for the long term and that is one of them."

Brown has coupled his request for immediate budget reductions with a call for a June special election in which voters would be asked to extend temporary tax hikes on their incomes, purchases and vehicles that have been in place since 2009.

Brown has steadfastly refused to detail what should happen if voters reject those taxes. Lockyer was not so shy, saying there would be no way to balance the books without shutting down the K-12 public school system at least six weeks of the school year.

Lockyer said Brown has been reluctant to outline such grim possibilities for fear of alienating a skeptical public.

"You can't seem to be threatening voters," Lockyer said.

Still, he said that presenting harsh realities was necessary, especially as most GOP legislators have dismissed Brown's call to place the tax question on the ballot. They say they want the budget balanced without new taxes.

Lockyer said that scenario would be "so awful I honestly don't know how any legislators can legitimately want to do that."

-- Shane Goldmacher in Berkeley

Brown wants to complete budget in 60 days, predicts cuts to education [Updated]

Gov.-elect Jerry Brown said Tuesday that he wants to complete a budget agreement within two months, an accelerated timeline that would allow a late-spring special election for potential tax increases or other revenue generation.

“I’m going to try to get the budget agreements done within about 60 days. I don’t think we have a lot of time to waste,” he said.

It's unclear whether the 60 days begins now, when he takes office on Jan. 3 or when he unveils his budget. Brown made the remark during a budget forum in Los Angeles, but he demurred when asked by reporters after the forum whether his proposal would contain only spending cuts or whether it would include new taxes.

“We’ll present a budget on Jan. 10. It will be a very tough budget but it will be transparent,” Brown told reporters after hosting a forum about the state’s budget crises. “We’ll lay it out as best I can. We’ve been living in fantasy land. It is much worse than I thought. I’m shocked.”

Brown laid out the timeline during his second budget forum, which was focused on education. Brown and other state officials painted a bleak picture for educators, saying that despite his view that education is a pillar of civilized society, the state’s deep fiscal problems and $28-billion budget gap means there will be more reductions in California’s classrooms.

“This is a really a huge challenge, unprecedented in my lifetime,” Brown told hundreds of educators, union representatives and parents who had gathered at UCLA. “I can’t promise you there won’t be more cuts because there will be.”

California’s K-12 system has been battered by billions of dollars of cuts in recent years, resulting in widespread teacher layoffs, the overcrowding of the classroom, the shortening of the school year and the elimination of many courses and extracurricular programs. Community colleges have eliminated courses and are turning students away. Students in the UC and Cal State systems have seen sharp fee increases.

“These last three years have been terrible,” said Tom Torlakson, the incoming state superintendent of public instruction.

Under the financial picture painted by Brown and other state officials, these conditions are likely to get worse. The state is facing a $28-billion budget gap for the next 18 months, and $20-billion deficits through the 2015-16 fiscal year. With education making up roughly 40% of state funding, much of these cuts will likely come from the state’s schools.

Educators responded by calling for an end to cuts, asking for greater discretion at the local level for how they spend their dwindling dollars, urging the state to seek more federal funding, and for the passage of legislation that would allow them to pass parcel taxes with 55% of the vote rather than the current requirement of two-thirds.

“We can’t take any more cuts. You really need to [look] elsewhere,” said Bernie Rhinerson, the chief district relations officer at the San Diego Unified School District. “We are at the cliff.”

Treasurer Bill Lockyer, who referred to himself as the "town grouch," grew visibly frustrated by some of the comments about increasing funding on programs such as online education, given the gravity of the state’s financial hole.

“Anyone who thinks we get by that without everyone getting hit probably should live in Mendocino County,” he said. “There are going to be cuts.”

“So far, I’ve heard good ideas about how to spend more money. Great. It ain’t there. It’s time to make cuts, I believe deep cuts,” Lockyer said. “I’d do 25% across the board. Those who wanted less government, you’re going to get your wish. In other communities that are willing to put something on the ballot to make up that difference, they’re going to have a higher service level.”

Educators appeared shaken by Lockyer’s remarks.

“There is no more meat on this bone to carve, the only thing left is amputation,” said David Sanchez, president of the California Teachers Assn. “If we do what Mr. Grinch wants us to do, the possibility of shutting down schools is a reality. Is that really what we want to do?”

[Updated, 5:53 p.m.: An earlier version of this post said Lockyer referred to himself as the Grinch. Lockyer referred to himself as the "town grouch." Sanchez referred to Lockyer as "Mr. Grinch."]

Lockyer later clarified that he had not been making a policy recommendation, but rather an analysis of what will happen unless voters are educated about the need for increased spending.

-- Seema Mehta in Los Angeles

Bill Lockyer opposes state property sales

State Treasurer Bill Lockyer said Monday that he is opposed to a plan to sell state properties to raise money to fill this year's budget gap, calling it "poor fiscal policy and bad for taxpayers."

The proposed sale faces a vote Monday of the five-member state Public Works Board. Lockyer said he is directing his representative to oppose the plan to sell 11 properties to generate $1.2 billion in short-term cash.

The state would then lease the properties back from the private owners for a minimum of 20 years.

"Taxpayers will be burdened with decades of lease payments," Lockyer said in a statement.

The nonpartisan Legislative Analyst's Office said this month that the transaction amounts to a 10% interest-rate loan over 35 years that will cost the state $1.4 billion.

Proponents say it will stop deeper cuts or higher taxes in the current state budget.

Lockyer also questioned why the state "would no longer operate these buildings, which it could do without terminating employment for thousands of state workers who have cared for our properties efficiently and effectively."

-- Shane Goldmacher in Sacramento




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