The California Association for Local Economic Development, CALED presented
the California Stimulus Summit last week.  The purpose of the event was to
present information on understanding the American Recovery and Revitalization
Act of 2009 and what it means to California.  The timing of the event came on
the heels of the state legislature approving the state's budget.  This provided
a great venue for the speakers to illustrate opportunities.

Multiple speakers provided differing insights to the elements from both the
federal stimulus package and changes from the state budget. The following
identifies highlights of the event.

Prefacing the formal remarks were short presentations illustrating the pending
publication of two major reports. First is the 2008 Year in Review from the
California Commission for Economic Development. This document focused on six
key areas:  Investment in Education; Enhanced Communication about the Economy;
Review Tax Structure; Government Regulation; Coordination of State and Federal
Interests; Increasing Advocacy.  Second is research from the Public Policy
Institute of California, entitled California Cities Economic Development Policies: 
Perspectives, Assessments and Implications for State Policy.  The report illustrates
that the role local government is playing is very substantial in economic development. 
It examines 478 cities in the state virtually all involved in economic development.

State Treasure Bill Lockyer provided insight to the state budget.  He illustrate
that sales tax receipts had dropped by 4 percent in 2008 and that the forecast for
2009 is higher at 6 percent.  One of the most significant items he presented was
the reduction in the state Gross Domestic Product, illustrating that this would be
one if not the first time the state would be witness to negative growth. His concern
stems from the issues of reduced spending and investment. He illustrated continued
declines to the economy through 2009 and that there may not be an increase in revenue
generation until 2013. 

“We need to let the dust settle on the budget to determine
if further cuts need to be made to balance the budget”.

                        Bill Lockyer, State Treasurer

However, he did describe that the passage of the budget would un-freeze resources
to fund 6,000 construction projects for housing, infrastructure, levies and schools.
In addition, he spoke about the need to examine the budget after the dust settles
because he believes that their will need to be additional cuts for a balanced budget.
He concluded his remarks by illustrating a recent report from Moody’s on how to
stimulate the economy.  The report found that bolstering resources for increased
items such as food stamps, infrastructure spending and increasing unemployment
benefits were ranked the highest.  Items such as a payroll tax holiday, accelerated
depreciation and an Alternative Minimum Tax, AMT
patch were not ranked as high as others might think.

Victoria Bradshaw with the Governor’s Office identified that the final budget
comprised of taxes, budgeted reforms, and stimulus.  She identified that the Governor
had completed 7 budgets last year.  What has come out in the budget is significant,
specifically the economic stimulus. The budget guidance of the Governor provides red
carpet versus red tape.  It also provides tax incentives for business, good resources
for small business, private-public partnerships for infrastructure and California
Environmental Quality Act, CEQA exemptions.

  “The budget guidance of the governor is red carpet,
    not red tape”.
    
                  Victoria Bradshaw, Governor’s Office

Dale Bonner, Agency Secretary of the Business, Transportation and Housing illustrated
that there are not only items in the federal stimulus but also in the state budget
in support of water infrastructure, but also for education and healthcare.  He
identified that the budget has a variety of elements to enhance the state’s business
climate, tax structure and business incentives. He also identified that there needs
to be a dialogue related to what can we all do not to implement and maximize the
impact form the stimulus package.  He outlined the concept of Regional Recovery Work
Plans that formulate specifically from regions on what they want or need to do or
intend to do to spur economic stimulus over the next 90 days and can be achieved over
the next 2 years. The Secretary identified that there should be an emphasis on working
together, creating greater leverage.  Do not put one another in the positions of
making decisions whose project is better, but look at opportunities. He also identified
that he would channel the Agency’s resources to support infrastructure projects, and
for transportation and shake the trees looking for monies in support of ways to
stimulate the economy.  He concluded by expressing the urgency of this economic
recovery action, in the spirit of the effort, should be seen as the speed necessary
to respond to an emergency disaster drill.

  “The urgency of our efforts of the economic recovery
   should be viewed in the spirit of this effort, as if we are
   responding to an emergency disaster drill”.
 
           Dale Bonner, Agency Secretary
           Business, Transportation and Housing

Lynn Jacobs, Department Director of Housing and Community Development illustrated
the tools that her Department has to help communities including the Enterprise Zone
program, enhanced Community Development Block Grant monies coming from the federal
stimulus package, monies for the homeless and tax credits for housing.  In addition,
she added that there would be a second round for neighborhood stabilization program.
And there will also be increased capital investments for low income housing, rental
assistance for Section 8, for rural housing, weather efficiency and insulation, job
programming m Native American CDBG, Homeland Security for food and Delta Restoration.

             “it is a joyous day and there is optimism in the future”.
     
                                             John Garamendi, Lt. Governor 
                                             on passage of the state budget

Lt. Governor, John Garamendi illustrated his enthusiasm for the budget by saying
it was a joyous day and that there is optimism in the future.  He specifically
focused on the stimulus package particularly the housing program.  He said,” Exactly
how and when it will arrive is still being worked out, but it will bring opportunity
to the state”.  In addition he illustrated that all total, between the state budget
and the stimulus package there is a lot of good news.  He asked the attendees to look
at both the stimulus in the budget together with the federal stimulus program to create
something even bigger.  He asked everyone to figure out how to leverage, exponentially
grow the stimulus.  Lastly, the Lt. Governor expressed that education and our subsequent
investment in it is the most significant investment that Californians can make.

Further information was provided by a series of panels representing US Dept of Commerce
Economic Development Administration and US Housing and Urban Development. In addition,
information was provided by Toni Symonds, Committee Consultant to the Assembly Committee
on the Economy, Economic Development and Jobs.  Also information was provided by Senator
Diane Feinstein’s Office that can be found at the Senator’s website at
www.feinstein.senate.gov.

In addition further information can also be found at the California Association for
Local Economic Development at www.Caled.org.

Finally, in addition to this material, the California Business Minute has completed
two short summaries on the outcome of the American Recovery and Revitalization Act
of 2009 and the state budget. These can be found at the homepage at the California
Business Minute.com. They will be updated as more information is identified related
to their implementation.  www.CaliforniaBusinessMinute.com