Last month, I announced Senate Bill 13, a bill that I am carrying this legislative session that will provide much-needed tax relief to the manufacturing, research and development, software and agricultural industries by expanding an existing sales and use tax exemption.
Businesses drive California's economy and we need to do everything we can to make sure they capitalize on any available tax break. I will continue to push for lower taxes and simpler, less burdensome regulations to let employers know that California is open for business in order to get our economy back on track.
Existing law allows manufacturers and research and development companies a sales and use tax exemption for their qualifying tangible personal property purchases up to $200 million a year. This includes property such as machinery and equipment used for manufacturing activities. Property that is considered to have a useful life of less than one year is excluded.
Senate Bill 13 seeks to expand the definition of businesses eligible to receive this exemption by including software publishers and others who conduct agricultural business activities. It will also increase the annual property purchase limit from $200 to $500 million a year. Finally, it will define property as having a useful life of one or more years if the property includes a warranty for one or more years.
I introduced this bill on the heels of recent reports indicating that the existing tax exemption has been severely underutilized. Since its inception on July 1, 2014 through September 30, 2016, businesses utilizing the exemption were only 21 percent of the original estimates made by the Department of Finance and Board of Equalization.
My hope is that by clarifying and expanding the exemption, that more businesses will be able to take advantage of it. Businesses should be rewarded for their contributions to our state, not continually penalized at every turn. I'm going to let them keep more of the money they earn instead of shipping it to an unaccountable Sacramento.
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California’s Massive Snowpack
The California Department of Water Resources conducted their February snow survey, a measurement of the water content of California’s snowpack. This monthly survey is used to determine the amount of runoff the state can expect throughout the spring and summer. Typically, melting snow provides roughly 30-percent of California’s water supply.
The snow survey showed that California’s stormy January was a drought-buster. The state is buried under a thick blanket of snow that will keep our reservoirs full all through the summer and make this a better year for recreation, agriculture, and for people who have had to cut back on personal water use.
But all this water also highlights that staggering lack of foresight and political will on the part of politicians who have neglected to build enough water storage to keep up with our growing population. The Sacramento River was recently surging with enough water every day to supply the needs of 150,000 families for an entire year. But instead of capturing that water in reservoirs it was being diverted into open fields or running out into the sea.
It won’t matter how much rain and snow we get if we don’t have a way to store it and move it around the state. This extraordinary winter is a gift but we aren’t ready to accept it. I’m tired of delays. I want to see concrete and steel in the ground, workers and bulldozers in action so the next time Mother Nature opens up, California can capture the water it needs.
Meeting With The Accountants
Senator Gaines visits with the California Society of Certified Public Accountants during their Legislative Day.
Thanks to the California Society of Certified Public Accountants for visiting with me during their Legislative Day at the Capitol and sharing the issues that affect the accounting industry. I look forward to our continued dialogue!
State Water Board’s Decision To Extend Drought
During a February meeting, the California State Water Resources Control Board made the decision to extend the state’s emergency drought regulations. By voting to extend the regulations, urban water districts will be subject to an additional 270 days of consumption reports, “stress tests,” and water-use cuts.
This decision is blind to the snow survey results and the plain fact seen on every mountain, river and reservoir in the north state. We are flush with water, and they know that, but this lays bare their “permanent drought” plan that will let them limit and control water use forever to meet their environmentalist agenda.
There has been so much talk about “sanctuary cities” and “sanctuary states” lately, all relating to immigration. But now I’m convinced that California citizens need a sanctuary from unelected bureaucrats who won’t call off the drought when people are all but having to canoe to work because of the rain.
The state needs to waive every rule, expend every dollar it has to get Sites Reservoir built and complete other surface storage projects so we can bank more of this water instead of letting it run out into the sea. Even a Sacramento bureaucrat with an agenda couldn’t fail to see the drought is over if we have more reservoirs filled to the brim.
Celebrating Rosanne Miller
Senator Gaines presents Rosanne Miller with a Senate Resolution celebrating her retirement.
I had the pleasure of presenting Rosanne Miller with a Senate Resolution recognizing her 17 years of service delivering the newspaper throughout the State Capitol as well as other legislative offices and government buildings. Rosanne maneuvered around the halls, making her delivery rounds in a timely and effective manner, always with her signature smile and courteous nature. I thank her for her dedication and contributions and wish her all the best in retirement!
Vote Against Tax-Spiking Transportation Proposal
Senate Bill 1, a measure that creates permanent new taxes and fees to fund transportation infrastructure, was before the Senate Committee on Transportation and Housing, and I voted against it.
Is anyone shocked that the proposed solutions to a very real transportation infrastructure crisis are more taxes and fees? It’s all Sacramento knows and it’s a tired formula that punishes taxpayers for the sins of the politicians.
We already have some of the highest gas taxes and worst roads in the country, made even more apparent by the potholes and sinkholes from recent storms. High Speed Rail needs to be put out of its misery before families pay another penny in gas taxes. The California Department of Transportation is overstaffed by 3,500 people, wasting $500 million every year. Cut that fat before forcing people to pay a new registration fee for their cars. California diverts a billion dollars in weight fees away from transportation infrastructure every single year. Let’s put that money back into road building before shaking down commuters and businesses even more.
Californians pay about three times the national average per mile of road maintenance. That begs for regulatory reform so that meaningless red tape doesn’t get in the way of delivering infrastructure at a cost that’s fair to taxpayers. Why is it that California spends nearly $50,000 in administration per state-controlled road mile while Texas only spends $4,000? Should our bureaucracy really cost 12-times more than theirs?
The new Washington, D.C. is proposing a massive infrastructure investment, common-sense, money-saving regulatory reforms, and cutting taxes – all at the same time. California needs to follow Washington’s lead instead of continuing to reach into hardworking taxpayers’ pockets to deliver the same pathetic results.
Mountain Counties Water Resources Association Symposium
Senator Gaines joins fellow north state lawmakers and panelists, Congressman Doug LaMalfa and Tom McClintock, California Senator Jim Nielsen and California Assembly Member Kevin Kiley.
Photos courtesy of Mountain Counties Water Resources Association.
I recently spoke at a regional water symposium hosted by the Mountain Counties Water Resources Association where we discussed views and perspectives on the regional and northern California water management challenges and opportunities under the new Trump Administration. Among other things, I reiterated my call for the state to redouble its commitment to increasing water storage capacity so we can have a bigger, more useful reserve for lean periods. That is simply prudent, like having a water savings account. I will continue working hard to give Californians better infrastructure and a dependable, affordable water supply.
Legislation To Protect Taxpayers
I have introduced Senate Bill 11, a measure that would immediately and proactively waive penalties and interest for taxpayers when a California State Board of Equalization (BOE) system failure prevents them from making tax payments on time.
Under existing law, tax payments made after the filing deadline are subject to interest and penalty. The BOE is currently authorized to waive any penalties or interest if the late payment is due to a disaster or BOE error, however, it is the responsibility of the taxpayer to file paperwork and petition for a refund.
This bill would grant the BOE authority to relieve California taxpayers and businesses from having to jump through hoops to settle up with the government for money they never should have owed. No paperwork, no waiting period, no lost capital. Why should the government make mistakes and taxpayers have to pay the price?
Senate Bill 11 comes on the heels of four separate BOE computer system failures over the past year, two of which occurred during peak filing deadlines leaving taxpayers unable to pay their tax bills on time.
During one of the outages, taxpayers attempted to access the BOE’s website 24,000 times. More than 600 taxpayers subsequently filed requests seeking relief of more than $600,000 in penalties imposed because of the technical glitch.
It’s not easy for businesses to survive in this state. Besides business competitors, our employers have to navigate the strictest meal and rest period law, expansive and expensive leave rules, punishingly high workers compensation rates, exorbitant energy costs, and unemployment insurance payments that have been climbing every year because the state is in debt to the federal government. The last thing any business needs is to compete against the government for tax money owed only because of a glitch in California’s IT. Computers fail, but government doesn’t have to.
Letter To President Trump On Folsom Dam
I sent the following letter to President Trump requesting that – in light of the Oroville Dam crisis ― he take action to conduct an immediate and thorough inspection of Folsom Dam; the existing Folsom Dam spillways; the soon-to-be-completed auxiliary spillway; and all levees potentially affected by a dam failure or unregulated flow from Folsom Lake.
Dear Mr. President:
The Oroville Dam spillway damage and subsequent emergency spillway damage and potential flood crisis have placed California’s water infrastructure at the forefront of national news.
As serious as that situation was (and continues to be), my Senate District is home to Folsom Dam, which is a Bureau of Reclamation facility that provides flood control to the Sacramento Valley. This Valley region of the state is vastly more populated than the Oroville area and floodplain and a failure of the dam or its spillways would lead to grave consequences for hundreds of thousands, or possibly millions, of people.
Although we have been spared any Oroville-level crises, the dam and original spillway have been strained beyond designed capacity and, on at least one occasion, failed. In 1986, in a year of heavy storms such as those we are experiencing now, Folsom released roughly 15,000 cubic feet per second above the safe capacity of the downstream levees. In 1995, a spillway gate failed and released an unregulated flow of roughly 40,000 cubic feet per second into the American River. Thankfully, this latter event occurred in the summer when lake levels are not at their storm-swollen highest.
Folsom is currently in the final stages of adding another spillway complex to the lake’s infrastructure to provide additional flood-control capacity. I am thankful that the project is nearing completion and I’m hopeful it will add safety to the region.
However, as we recently witnessed in Oroville, it is possible that projects will not perform as they are designed to perform and that what appears to be a well-designed or well-maintained project may be suffering from latent defects that put people in serious jeopardy.
Sacramento is one of the most at-risk flood areas in the country. As such, and in light of recent events in Oroville and the untested new auxiliary spillway soon coming on line, I am requesting that you task the Bureau of Reclamation, Army Corps of Engineers, or any other relevant and proper federal entities to conduct an immediate and thorough inspection of: Folsom Dam; the existing Folsom Dam spillways; the soon-to-be-completed auxiliary spillway; and all levees potentially affected by a dam failure or unregulated flow from Folsom Lake. These levees are a critical last defense for many people. Although I understand that they are not all federal, I am hopeful that your review could include multi-jurisdictional cooperation that resulted in a comprehensive review of this valuable infrastructure.
Lastly, I ask that if this review uncovers any problem that presents a danger to the people or property of California, that you waive or expedite any federal requirement that could delay the necessary remedy. I agree with you that this nation needs to renew its commitment to infrastructure investment and it can’t be delayed by unnecessary red tape.
Thank you for your leadership and concern for California and all the people of this great nation.
Senator, 1st District