Amazon invites its fired California associates to come back

 
Now that Amazon.com has settled a summer-long dispute with the state of California over collecting sales taxes on Internet purchases, the world's biggest e-retailer wants to hook up again with 10,000 operators of affiliated websites that it fired in late June.

On Tuesday, Amazon e-mailed its "California associates," telling them it's ready again to start paying them commissions for any sales made to customers who "clicked through" to Amazon's shopping site.

"As you may have heard, California Gov. Jerry Brown has signed legislation repealing the law that had forced us to terminate our California Associates," Amazon said. "We are pleased to invite all California Associates whose accounts were closed due to the prior legislation to re-enroll in the Associates program."

As part of the deal with Brown, lawmakers and bricks-and-mortar retailers, such as Wal-Mart Stores Inc. and Target Corp., Amazon agreed to start collecting sales taxes in September 2012 and work with California and other states to ask Congress to pass a national Internet sales tax collection law.

While the agreement is good news for many Amazon affiliates, ranging from single-person bloggers to Internet businesses with dozens of employees, it comes too late for some operators, who had already gone out of business or fled the state when their Amazon-related revenues started disappearing.

"I liked California while it lasted, but I was losing my entire family's income," said Ken Rockwell. He quickly moved from San Diego back to his native New York City after Amazon cut him off.

"Why would I come back?

Rockwell said he can run his photography website from anywhere he has an Internet connection.

"I'm looking forward to this thing being worked out on a national scale," he said, "but that's going to take some years."

Related:

The Amazon.com compromise

Amazon to alter the way it does business in California

Amazon cuts deal on California sales taxes

-- Marc Lifsher

Photo: Amazon fulfillment center in Goodyear, Ariz. Credit: Ross D. Franklin /Associated Press

Gov. Jerry Brown proposes job creation plan for California

Gov. Jerry Brown wants to expand a hiring tax credit and provide tax relief to businesses that buy manufacturing equipment, while getting rid of a loophole that voters supported in elections in 2010.

Brown's California Jobs First package was announced a week after the state Employment Development Department said that hiring slowed in July to just 4,500 jobs, helping push the  unemployment rate to 12%. The state has the second-highest unemployment rate in the nation, after Nevada. Business creation in the state has also slowed to a halt, according to a study released earlier this week.

"Boosting job growth in California is a top priority, and this proposal is a critical step in making sure the state does everything it can to support local job creation," Brown said in a statement.

The first part of Brown's plan expands a tax credit for hiring new employees. He wants the credit to include small businesses with up to 50 employees and to increase the credit to $4,000, from $3,000.

The second part will make start-ups exempt from the state portion of sales tax on manufacturing equipment for their first three years in business. It also exempts 3% of other firms for those same purchases. Brown's office estimates this will provide $1 billion in tax relief to businesses.

The third part could be the most controversial. It would make a single sales factor tax mandatory on all businesses in California. Currently, multi-state businesses can choose how their sales tax is calculated. They can chose between basing their taxes on the proportion of their sales occurring in the state, or on a combination of sales, payroll and property in the state.

One of the provisions of Prop. 24 in the 2010 election would have disallowed corporations from choosing how to calculate their taxes, but Prop. 24 was not passed. 

"It's time to enact this common sense plan that puts California's economy and our jobs ahead of out-of-state tax loopholes," said Assembly Speaker John A. Perez.

RELATED:

California's business tax burden no heavier than average

California plunges to bottom in job creation

California jobless rate grows to 12% in July

-- Alana Semuels

Photo: Gov. Jerry Brown in Sacramento. Credit: Eric Paul Zamora/The Fresno Bee

 

PG&E wants Diablo Canyon nuclear plant's relicensing to be delayed for seismic testing

Pacific Gas & Electric Co. has asked federal authorities to delay the license renewal proceedings for its Diablo Canyon nuclear power plant until more thorough seismic testing of the area around the plant can be performed.

In the wake of the earthquake and nuclear crisis in Japan, people have been calling for advanced seismic testing around California's nuclear plants.

In 2009, PG&E applied to renew the licenses for its two nuclear reactors in San Luis Obispo County, which expire in 2024 and 2025. The renewal application process can take years.

"In light of recent events at the Fukushima Daiichi Power Plant, and the considerable public concern regarding the need to assure the seismic safety at DCPP, PG&E has decided it is most prudent to have completed certain seismic studies at [Diablo Canyon] prior to issuance" of the renewed federal operating licesnses," the utility said in a statement.

Though Diablo Canyon's engineers assured public officials in the late 1960s that the area around the plant had only "insignificant faults," at least two faults have been discovered since its construction, including one in 2008 less than a mile away.  

That fault, called Shoreline, is thought by geologists to be capable of producing a magnitude 6.5 quake. The other fault, called Hosgri, is rated up to 7.3. 

California energy authorities and legislators have asked PG&E to perform thorough studies of the seismic risks near the plant before it seeks a 20-year renewal of the licenses for its nuclear reactors. 

“I commend PG&E for taking the responsible action of delaying relicensing until critical seismic questions are answered," said state Sen. Sam Blakeslee (R-San Luis Obispo). "We respect that this is a difficult decision that demonstrates their willingness to prioritize the safety of Californians.”

-- David Sarno

California may not sell bonds in 2011 if budget battle drags on

California’s budget woes could keep the state from issuing any new general obligation bonds this year, Treasurer Bill Lockyer is warning.

That would be another blow to the state economy if the result is delayed funding for voter-approved infrastructure projects.

But a lack of bond issuance by California could help the tax-free municipal bond market overall, which still is trying to recover from a blistering sell-off by investors in late 2010 and early 2011.

The state in recent years has been the largest single muni bond issuer nationwide, as Lockyer has sold debt that voters have authorized for new education facilities, roads and other projects. California issued $10.4 billion in general obligation debt last year alone. It has a backlog of $37 billion left to sell.

But Lockyer in January canceled his usual spring sale of bonds as part of Gov. Jerry Brown’s plan to pare the state’s huge budget deficit.

Instead, Lockyer agreed to limit general obligation bond issuance to $5.76 billion this calendar year, and that the sale wouldn’t occur before fall.

Now, even that bond offering may be canceled.

As The Times’ Anthony York wrote from Sacramento on Thursday, Brown’s proposal for a June ballot initiative to advance his budget plan may not be approved by the Legislature.

Brown wants to ask voters to OK a five-year extension of certain tax increases to fill part of the budget gap. If the measure fails to make the June ballot, Brown is considering other ways to get it on the November ballot, York reported.

Without a balanced-budget deal in hand, however, Lockyer would be unlikely to try to sell bonds before the election, his office says. Even if the measure passed in November, it isn’t clear whether there would be enough time to get a deal together before the end of the year, said Tom Dresslar, Lockyer’s spokesman.

A lack of bond issuance by California would further limit the supply of new muni securities hitting the market this year. As many investors have fled the muni market since November, spooked by predictions of rising muni defaults in 2011, some state and local governments have been forced to pull back from borrowing plans. That has slashed the supply of new debt.

Meanwhile, investors' dumping of existing tax-free bonds drove muni market yields to two-year highs in January.

But yields have come down from their highs and have stabilized in recent weeks. The annualized tax-free yield on the Bond Buyer newspaper's index of 40 long-term muni issues nationwide was 5.67% on Thursday, down from a peak of 5.95% in mid-January.

The lack of bond sales by California could mean that other issuers, such as local governments in the state, will have an easier time floating debt -- if they decide to brave what still are dicey muni market conditions.

Also, without new state bonds for sale, owners of previously issued bonds might find it easier to sell those securities at decent prices if investor demand picks up.

-- Tom Petruno

Photo: State Treasurer Bill Lockyer. Credit: Armando Arorizo / Bloomberg News

LifeLine telephone rates extended for low-income customers

Special LifeLine rates for low-income telephone customers that had been set to expire at year's end have been extended for another two years by state regulators.

The California Public Utilities Commission by a unanimous vote Friday froze the current LifeLine rate at $6.84 a month for most customers through 2012.

The program was expanded to include special rates for data services to consumers that get wireless equipment through the commission's Deaf and Disabled Telecommunications Program.

The five-member commission also approved a process that will allow low-income customers to receive LifeLine discounts on wireless telephone and voice-over-Internet systems.

"This major policy change is in response to the large number of low-income Californians that only have a wireless phone," said PUC President Michael Peevey.

Peevey promised to vigilantly monitor deregulated telephone company basic rates over the next two years to make sure that potential increases do not affect the affordability of LifeLine service.

After Jan. 1, 2013, LifeLine rates will be set annually as a percentage of their basic service cost.

"LifeLine rates will always be affordable," Peevey said.

-- Marc Lifsher

California public pensions underfunded

Independent government pension funds, including those operated by the city and county of Los Angeles, were in weaker conditions than previously estimated before the recession of 2008-2009, said a study released Thursday by Stanford University.

According to the report, written by former state Assemblyman Joe Nation of the Stanford Institute for Economic Policy Research, the state's independent pensions collectively didn't have enough money to pay for $195-billion worth of obligations to current and future retirees as of June 30, 2008.

Nation based that figure on a "risk-free discount rate" that projected that the funds would earn an extremely conservative average return of 4% a year. California pension administrators consider a 4% return as too low and base their forecasts on average annual returns of between 7% and 8%.

The average funding level, derived by dividing total assets by total liabilities, was only 44.7% for the independent systems, the Stanford study said. That's virtually identical to a number cited by a similar report earlier this year on the three big statewide pensions: the California Public Employees' Retirement System, the California State Teachers' Retirement System and the University of California Retirement System.

The growing obligation could force local governments to devote half of their payroll over the next 18 years to pay for such so-called unfunded liabilities, the study said.

According to Stanford, worst-case estimates for various Los Angeles-based retirement systems hit as high as nearly $40 billion as of mid-2008: the Los Angeles County Employees' Retirement Assn. had $39.7 billion, the Los Angeles Fire and Police Employees' System $14 billion, the Los Angeles City Employees' Retirement System $13 billion and the Los Angeles Water and Power Employees' System $8 billion.

The Stanford report "confirms that all levels of government have been understating the pension debts owed by taxpayers to government workers," said outgoing Gov. Arnold Schwarzenegger. He recently reached an agreement with lawmakers and some government workers unions to cut future pension benefits for new state hires.

-- Marc Lifsher

 

 

Political power player Darius Anderson under scrutiny related to pension deals

Darius Anderson is a well-known player in the high-powered and often-overlapping worlds of California business, lobbying and politics.

No stranger to campaign finance, he’s raised millions of dollars for candidates over the years, mostly for Democrats. Citing that expertise, state Fair Political Practices Commission Chairman Dan Schnur appointed Anderson this week to a prestigious panel that will examine overhauling state campaign finance disclosure laws.

Anderson, 45, brings a “valuable perspective” to the panel because of his “professional work as a practitioner” and as a fundraiser and lobbyist, Schnur said.

Others aren’t so sure it was a good choice.

Anderson and his Sacramento lobbying firm, Platinum Advisors, recently paid $500,000 to settle claims by New York Atty. Gen. Andrew Cuomo stemming from a yearlong investigation into so-called pay-to-play practices in city and state pension fund investment partnerships.

And federal and California law enforcement officials also have looked into Anderson’s role as broker of public pension deals, though he has not been accused of any wrongdoing.

“The appointment certainly raised my eyebrows, and upon hearing further details, it raises questions in my mind,” said Derek Cressman, the western regional Director for Common Cause. “I think we need to pay close attention to the role he plays on this commission.”

Anderson through a spokesman declined to comment either on the reported probe by state Atty. Gen. Jerry Brown or on his appointment to the 25-member task force formed by the Fair Political Practices Commission.

Schnur said he was “aware of the investigation” in New York and inquiries about Anderson made by California attorney general’s lawyers. Anderson, he noted, has not been charged with any wrongdoing in either state. He said that the goal of the selection process was “to establish a task force that was balanced between those who had devoted their time as political reformers and those who had worked in the field of practical politics.”

Anderson’s influence is felt in political, business and philanthropic circles in Sacramento, San Francisco and Los Angeles.

California Energy Commission approves $114.3 million for electric and ethanol vehicle infrastructure

Owners of eco-friendly vehicles in California are now $114.3 million closer to having workable options for charging and fueling up.

The California Energy Commission approved three awards to help set up electric- and ethanol-powered vehicle infrastructure around the state. Of the funds, $15.4 million comes from state coffers, $49.6 million is federal money and $49.3 million comes from private sources.

One project, a partnership between Electric Transportation Engineering Corp. and Nissan Motor Co., will establish up to 1,000 residential chargers and 1,300 commercial ones, as well as 60 “Level 3 fast chargers,” in San Diego County.

Program participants will shell out $32.6 million on top of the $8 million provided by the energy commission and $39.4 million from the U.S. Department of Energy.

Nissan will deploy 1,000 of its new Leaf electric vehicles in the market and study their performance, leading eventually to the release of 242,000 Nissan electric vehicles by 2015.

The commission awarded a $3.4-million grant to a project by Coulomb Technologies of Campbell, Calif., to build 1,667 charging stations in the San Francisco, Sacramento and Los Angeles areas, adding almost $3.4 million more in federal stimulus funds. Coulomb, already involved in a project to set up 4,600 stations for free around the country, and its partners will put up $508,000.

The third grant from the commission, worth $4 million, will go toward building 75 ethanol-based fuel filling stations around the state. Partners, including California’s Department of General Services, Propel Fuels Inc., the East Bay Clean Cities Coalition, CALSTART and the Local Conservation Corps of California will provide $16.3 million in funding. The federal energy department will pitch in $6.9 million.

-- Tiffany Hsu

Sacramento's tent city to fold

Too much media attention can be a bad thing. At least that seems to be the case for a tent city of 200 that sprang up a year ago in Sacramento. From latimes.com:

Then this tattered encampment along the American River began showing up on Oprah Winfrey, Al Jazeera and other news outlets around the world. On Thursday, city officials announced that they will shut it down within a month.

"We're finding other places to go," said Steven Maviglio, a spokesman for Sacramento's mayor. The camp is "not safe. It's not humane. But we're not going in with a bulldozer."

The ragtag community captured the collective imagination through a powerful combination of geography, celebrity and journalistic convenience.

"This is the state capital of the seventh-largest economy in the world, with a movie-star governor, Arnold Schwarzenegger, and an NBA pro athlete for a new mayor, Kevin Johnson," said Barbara O'Connor, director of the Institute for the Study of Politics and Media at Cal State Sacramento. And the camp "is a wonderful visual for TV journalists."

"Wonderful visual" or not, the camp is what it is: home to the homeless, many of whom never imagined they'd find themselves in such a predicament. This is the only tent city in California that presents a photo op. Is it because the camp is inconveniently located in our state capital? Is anyone else struck by the mayoral spokesman's quote? "We're finding other places to go."

-- Lauren Beale

Thoughts? Comments?

Photo: Homeless construction worker Jim Gibson, 50, ponders his future standing outside a community tent used for cooking near a bank along the American River in Sacramento. Gibson lost his job 6 1/2 months ago and has been living in the tent city for 4 1/2 months. He spends his days looking for work in construction but has had no luck. "I'm embarrassed. This is hard for me to try and deal with this," Gibson said. Credit: Genaro Molina / Los Angeles Times