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Drought Watch: Getting More Pop per Drop

This is part of a continuing series on the impact of the drought.

With the state still facing drought conditions, the Senate Budget and Fiscal Review Committee held a hearing yesterday titled “Water: State and Local Funding Relationships and the 2015-16 Governor’s Budget.”

PPIC senior fellow Ellen Hanak testified to the panel about the recent history of the state’s water finance. (Here is her slide presentation.) She noted that California has been relying increasingly on state bonds to finance water projects, using six bonds to raise almost $20 billion between 2000 and 2006, in addition to the $7.5 billion bond that voters passed last November.

She recommended that the state gather more information on water use so that water can be fairly allocated when supplies are low. She also said the state Fish and Wildlife Department is doing a good job managing ecosystems during the drought but that California could benefit from a more strategic plan to do so, as Australia adopted during its recent drought.

Noting that the state needs to find ways to stretch scarce water supplies, Senator Mark Leno (D-San Francisco) said he was going to adopt a line from Ellen’s testimony as the “mantra” for the committee: “greatest pop per drop.”

Drought Watch: Water Not Wasted to the Sea

This is part of a continuing series on the impact of the drought.

Northern California got a good soaking last weekend, with more than 10 inches of precipitation in many parts. This translated to healthy amounts of water flowing off the hillsides. Much of it is headed into our large reservoirs where—after three years of drought—there will be plenty of capacity to store it for later use for cities, farms, and the environment. But a significant amount made it into rivers in the Sacramento Valley. From there, that water is on its way to the Sacramento-San Joaquin Delta, San Francisco Bay, and ultimately the ocean.

To many, the notion of water to the ocean is akin to water wasted. It is perceived as serving no valuable purpose before mixing with salt water and being rendered useless.

This perception is understandable if we limit our thinking to benefits from direct use of water: manufacturing, industry, drinking, sanitation, or growing gardens and crops. But outside of improving habitat for native species, there are multiple indirect benefits derived from water currently running into the Delta.

The most conspicuous is improved water quality. January’s record low precipitation left the Delta unusually salty. A salty Delta poses problems for the more than 25 million people and more than three million acres of irrigated agriculture that make use of it. Salt is also a problem for farmers in the Delta who rely on local water for irrigation.

To keep the Delta fresh enough for exports and uses in the Delta during dry periods, water has to be released from upstream reservoirs. And a great deal of that released water has to pass through the Delta and into the Bay to keep salt water from encroaching on the Delta. The water used to create this hydraulic barrier cannot be recovered.

A wave of water coming down the Sacramento River freshens the Delta, naturally pushing the salty water out. Depending upon how we operate the export pumps, the effect of this flush can last a long time and allows dam operators to husband their stored water for use later in the year.

Last year, we had three of these flushing events in the late winter and early spring that cleaned up a very salty Delta. These events created benefits—by reducing dam releases necessary to keep things fresh—that lasted into the summer.

Indirect benefits of this water do not end at the Delta. Shorelines and marshes throughout the San Francisco Bay are eroding due to a lack of sediment. This is part of a long-term trend with many causes, but is largely due to the trapping of sediment upstream by dams and levees and a lack of sufficient river flows to move it out of the Delta and into the Bay.

Additionally, as the more than 20 operators of wastewater treatment plants in the Bay Area know, water quality is a major—and potentially very costly—issue of concern, particularly in the South Bay. Freshwater inflows to the Bay help improve water quality and help the Bay meet state and federal standards.

So when you see the brown water from this latest storm moving down the Sacramento River, out through the Delta into the Bay, keep in mind that it is hardly wasted, but rather is creating indirect but vital benefit for a broad range of users.

How California Reduced Its Prison Population

After years of struggling with a 2009 federal court order to reduce the population in the state’s overcrowded prisons, the inmate population has reached the target of 113,700 (based on current capacity), roughly a year ahead of schedule. A look at historic prison and jail data reveals that this milestone has been achieved to a significant extent by adding capacity and simply shifting inmates to institutions not subject to the court order. As a result, cost savings from the various efforts appear lacking so far. The state’s spending on corrections is now at a historic high.

Since reaching its peak in 2006 of about 163,000, the institutional prison population has dropped dramatically, by slightly more than 49,000. The court order mandated that inmate population be reduced to 137.5 percent of design capacity, or the number of inmates the facilities were intended to house.

Realignment, the state’s biggest correction reform, was a response to the court. It shifted incarceration of many lower-level felons and parole violators from state prison to county jails, beginning in 2011. However, a significant share of the prison population—about 18,000 inmates—declined before realignment. Most of this drop happened between 2009 and 2011 and was driven by policy changes such as SB 678, which created financial incentives for counties to lower the number of felony probationers they sent to state prison. Realignment then led to the largest decline, about 28,000, in the state’s institutional prison population. The post-realignment drop occurred in the first year of the reform.

The prison population did not start to decline further until November 2014, when voters passed Proposition 47, which classifies a number of drug and property offenses as misdemeanors instead of felonies. Since then, the institutional prison population has dropped an additional 3,000, which pushed the number of inmates below 137.5 percent of design capacity.

The state has met the crucial federally mandated target, but not—as reform proponents hoped—by a major reduction in costly prison incarceration. Here’s a rough breakdown of how this was achieved.

First, the decline of about 18,000 inmates in the institutional population prior to realignment was partly accomplished by housing about 9,000 offenders in private prison facilities out of state—a practice that continues on about the same order of magnitude. Second, since the implementation of realignment, the state has also incarcerated an additional 3,900 inmates in public and private facilities in the state. California has also opened up a new state prison health care facility in Stockton with a capacity of almost 3,000 inmates. Third, since realignment shifted responsibilities of many lower-level felons and parole violator to the counties, the county jail population has increased by about 11,500, as of June 2014 (the numbers may have come down some since then because of Proposition 47). In sum, roughly one half of the reduction of the institutional prison population since its 2006 peak was achieved by increasing capacity and simply shifting inmates to other facilities.

California has indeed seen a significant decrease in the reliance on incarceration over the last decade through policies like SB 678 and realignment, as well as initiatives like 2012 Proposition 36 (which revised California’s “Three Strikes” law) and Proposition 47. Our total incarceration rate has dropped from about 702 per 100,000 residents in 2006 to about 568. Unfortunately this is not reflected in the state’s expenditures. In fact, spending on corrections is now at a historic high. A look at corrections spending going back to the 1970s shows a long-term increase. In the current budget year, the state is spending more than $12 billion on corrections. In other words, meeting the federally mandated target does not mean that California has solved its incarceration problem.

Research shows that incarceration at current levels is not a cost-effective way to prevent crime. Clearly we need to refine our crime prevention strategy and look more closely for effective alternative approaches to manage public safety.

Commentary: Set Water Priorities to Prepare for Drought

This commentary was published today by the San Francisco Chronicle.

There are still two months left in the rainy season, but all indications are that California’s drought is extending into a fourth year — even with the soaking Northern California is expecting this weekend.

Already, state officials are making tough choices about priorities for water use. Nowhere is this more difficult than managing water for the environment . . .

(Continue reading on sfchronicle.com.)

Video: January PPIC Statewide Survey Briefing

State residents are feeling more optimistic than they have in years—about California’s elected leaders, the direction of the state, and their own economic futures. Dean Bonner, associate survey director, presented these and other key findings at a briefing last week in Sacramento. In addition to asking about government and fiscal issues, the January survey gauged opinions on four important issues being debated at the state and federal level. Among the findings:

  • Crime, police, and race relations. A solid majority of Californians say the police are doing either an excellent job or good job controlling crime in their communities. But blacks are much less likely than others to hold this view.

  • Water and drought. A majority of Californians say the supply of water is a big problem in their region, and most say the state and local governments are not doing enough to respond to the current drought.

  • Health care reform. A record-high 51 percent of Californians have a generally favorable view of the 2010 health care reform law, while 41 percent have an unfavorable view.

  • Immigration reform. A solid majority of residents support President Obama’s executive action to shield as many as 4 million immigrants from deportation, while about a third are opposed.

The Debate Over Extending Proposition 30

One of the most controversial issues that the governor and legislature face in 2015 is what to do about the Proposition 30 tax increase. This citizens’ initiative passed with a 55% yes vote in November 2012. The governor says this tax increase is meant to be temporary. But others say that the state budget situation has improved because of Proposition 30, and it could deteriorate if we allow the sales and income tax increases to fully expire in 2018. In the most recent PPIC Statewide Survey, 52% of likely voters would favor a Proposition 30 tax extension. We found identical results in our December 2014 poll. A slim majority of support suggests that a tax extension is in the realm of the possible but far from a sure thing.

Why the sense of urgency? Tax proponents say that the November 2016 presidential election offers the last chance for a high turnout among voters who are likely to support a Proposition 30 tax extension before its sunset in 2018. Our most recent poll confirms this view. Support for the tax extension falls short among the likely voter groups with the highest propensity to vote: Republicans (30%), whites (49%), homeowners (48%), age 55 and older (50%), and those with annual incomes of $80,000 or more (45%). Support is highest among these lower-propensity likely voter groups: Democrats (69%), Latinos (68%), those under age 35 (61%), renters (61%), and those with annual incomes under $40,000 (59%). As these numbers suggest, it would be a riskier proposition to wait until the 2018 gubernatorial election for a tax extension vote.

Many observers think that the voters will take their cues from Governor Brown if they are asked to weigh in on this issue. After all, it was the governor who brought this tax measure to the voters when the legislature failed to act. In our latest poll, most likely voters—58%— approve of the governor’s job performance, and most who approve of Brown also favor a tax extension (69%). Also, those who prefer Governor Brown’s approach to the state budget over their Democratic and Republican legislators overwhelmingly favor a tax extension (75%). In sum, Brown’s position on the tax extension will matter. But no one is certain whether he will actively support or openly oppose a tax extension in 2016.

Some are looking to tweak the current Proposition 30 tax increase to gain more favor with the voters. There are calls, for example, for the creation of another temporary tax increase instead of making the Proposition 30 increases permanent. That may help gain voter support, but we have no PPIC polling data suggesting that voters supported Proposition 30 because it was temporary. Others argue that the tax on earnings over $250,000 should continue while the one quarter cent sales tax is allowed to expire. This might well improve the chances of passage and is consistent with our past polls, which show majority support for raising taxes on wealthy Californians and majority opposition to a state sales tax increase.

What is missing from this political calculus? A selling point of the Proposition 30 tax increase was its beneficiary: K-12 education. In our past polling, Californians have ranked K-12 education as their highest spending priority. However, relatively few (correctly) perceive that K-12 education is now the largest area of state spending.

Our recent poll shows that the knowledge gap is wide when it comes to the state budget: 57% of likely voters say that K-12 education is their highest priority for state spending, but just 19% are able to cite K-12 education as the largest area for state spending today. Among the likely voters whose top spending priority is K-12 education, 54% are in favor of a tax extension. Among those who think the state’s top spending category is something other than K-12 education, 56% are in favor of a tax extension. But among those who accurately say that K-12 education is the state’s top spending area, just 35% favor extending Proposition 30.

Our survey also asked what is the one issue facing California today that is most important for the governor and legislature to work on this year. Among the likely voters who named K-12 education, 65% are in favor of a Proposition 30 tax extension. In sum, the fate of a Proposition 30 tax extension in 2016, as was the case for Proposition 30 in 2012, will likely depend on how the voters perceive its effects on K-12 education.

The November 2016 presidential election offers the best chance to include the most voters in this contentious issue. And, as our recent poll shows, Californians want a role in fiscal decisionmaking. An overwhelming 76% of likely voters say they prefer that voters make some of the decisions about spending and taxes at the ballot box, while just 21% say that they want the governor and legislature to make all of these decisions. Why not give the voters a chance to hear the pros and cons in a debate that can also help increase knowledge about the budget and give them the role they want to determine California’s future?

Commentary: Obama’s Community College Plan No Panacea

This commentary was published today by the Washington Post.

President Obama’s proposal to make community colleges free is a valiant effort to address the rising demand for skilled workers throughout the nation and to improve college access for low-income students. As states consider his proposal, they would be wise to look to California . . .

(Continue reading on washingtonpost.com.)

Testimony: Building Trust in State Government

Today California’s Little Hoover Commission held its first public hearing on the nature and quality of interactions between state government and the public. The commission invited Mark Baldassare, PPIC president and CEO, to testify about the public’s trust in government. Here are his remarks.

Thank you for the opportunity to contribute to your important and timely discussion about improving the delivery of public services and better engaging Californians with their state government. I have been asked in my testimony to set the stage for your work by helping you to better understand current public sentiment toward state government.

Last year, voter turnout in California reached a historic low: 30.9 percent of eligible adults in the November general election and 18.4 percent in the June primary. Millions of Californians who could register to vote did not, and millions of Californians who could vote opted out. These numbers clearly point to a California public that is disconnected from their state government today.

This is consistent with what we have observed in the Public Policy Institute of California (PPIC) Statewide Survey since we began monitoring Californians’ attitudes toward government in the late 1990s. We have been asking questions about government trust focused on effectiveness, responsiveness, and efficiency at the local, state, and federal levels. And we have found that Californians’ distrust in state government predates the low voter turnouts of the 2014 election.

My purpose is to provide information on the magnitude of public distrust in state government today, the differences among demographic groups, and how current levels of distrust compare with the past. I will also contrast opinions about government at the local, state, and federal levels. Lastly, I will talk about the implications of our findings for state government leaders.

The source of most of my comments about trust in state government today is the PPIC Statewide Survey: Californians and the Future report from December 2014, which I coauthored with PPIC colleagues Dean Bonner, Renatta DeFever, Lunna Lopes, and Jui Shrestha. Our latest findings on trust in state government are based on interviews with 1,704 adult residents throughout California from November 10 to November 17, conducted in English or Spanish and by landline or cell phone with a sampling error of ± 3.7 percent.

We asked our tracking question on government effectiveness, “How much of the time do you think you can trust the state government in Sacramento to do what is right?”—and only one in three Californians said just about always (7%) or most of the time (25%). Two in three Californians said that you can trust the state government to do what is right only some of the time (61%), or volunteered that they trust it none of the time (5%). These perceptions are shared across regional and demographic groups. Republican and independent voters express more distrust in state government than Democratic voters do. In our polling a decade ago, the results for this question were similar. However, perceptions have improved somewhat since October 2010 (3% always, 15% most of the time, 67% most, 12% none).

Responding to our tracking question on government responsiveness, 67 percent of California adults said “the state government is pretty much run by a few big interests looking out for themselves,” while only 28 percent said that “it is run for the benefit of all of the people.” Majorities across regional and demographic groups perceive the state government as pretty much run by a few big interests looking out for themselves, and Republican and independent voters are more likely to express this negative view than Democratic voters are. Again, the results were similar a decade ago, while perceptions have improved somewhat since October 2010 (75% big interests, 17% all of the people).

In our tracking question on government efficiency, 54 percent of adults said they “think the people in state government waste a lot of the money that we pay in taxes,” 35 percent said “people in state government waste some of it,” and 8 percent said they “don’t waste very much of it.” Majorities across most regional and demographic groups hold the perception that the people in state government waste a lot of money, while Republican (78%) and independent voters (60%) hold this view much more often than Democratic voters (46%) do. Once again, the results were similar in our polling a decade ago, while perceptions have improved somewhat since October 2010 (66% a lot, 26% some, 6% don’t waste very much).

We asked the same three questions on effectiveness, responsiveness, and efficiency about the federal government in our May 2014 poll and about local government in our May 2011 poll. State government fares only slightly better than the federal government in ratings of trust. Local government fares the best of all levels. Californians are much less likely to say their local governments “waste a lot of the money paid in taxes” or are “pretty much run by a few big interests looking out for themselves.” They are slightly less likely to say that they can trust their local governments “to do what is right only some of the time or none of the time.”

In summary, the negative perceptions about the effectiveness, responsiveness, and efficiency of state government are consistent over time and widely held in the public today. What are the implications of our findings for state government leaders? First, Californians will continue to value the citizens’ initiative process as they seek to have a say in the major decisions made by their state government. Second, many Californians will be skeptical about the need for higher state taxes and more state revenues, given their level of distrust in their state government. Third, proposals to move authority and control to the local level will resonate with Californians, given their higher levels of distrust in state government. Last but not least, civic disengagement will continue to be a problem. We may reach new lows in voter participation given the level of distrust in government.

I’d like to close on a more hopeful note. This commission’s work comes at a time when we are seeing some improvements in all three indicators of trust in state government. In the wake of a growing economy and better fiscal situation, the approval ratings of the governor and state legislature are also on the rise, as our survey results show. The voters have also approved a series of major legislative and fiscal reforms in recent elections. In our polling, the public is signaling their early support for local control of school funding and state-local corrections realignment.

It will take time to see whether these reforms and changes satisfy a distrustful public. I’m optimistic that we are poised to make gains in trust in state government over the next few years, and this is an area where California could lead the nation. New efforts toward building trust in state government will pay dividends in the form of citizen engagement. They are important for the future of all Californians.

Dividing California’s Higher Education Pie

The tuition increase recently approved by the University of California Regents has ignited a debate about how the state allocates money for higher education. A brief look at the history of state funding can provide some much-needed perspective.

Each higher education system—UC, the California State University, and the community colleges—receives substantial funding from the state. Most of the remaining funds for instruction come from tuition paid by students. (In this analysis, we look at allocations from the state General Fund and property taxes so that we can compare institutions across time.)

Since 1965, the share of higher education funding provided directly by the state has shifted from the four-year systems to the community colleges. In the mid-1980s, the community colleges received about a third of the state allocations to public higher education institutions. In 2014‒15, the community colleges got more than half of the pie. Meanwhile, the share allocated to CSU and especially UC has been shrinking. UC’s share fell from 38% in 1965 to 24% in 2014‒15, and CSU’s share declined from 25% to 22%. The governor’s proposed 2015‒16 budget includes a funding increase of $843 million to the state’s public colleges and universities—71% ($600 million) of which would go to the community colleges.

The large increase in state allocations to community colleges is linked to increased enrollment. But enrollment has increased just as much at UC and CSU. Indeed, on a full-time equivalent basis, UC, CSU, and the community colleges each serve about the same share of the state’s public higher education students today as they did 50 years ago. So what explains the shift in the share of funding from UC and CSU to the community colleges?

The short answer is Proposition 98.

After Proposition 13 passed in 1978, the state’s community colleges—which unlike UC and CSU relied partly on property taxes—saw a sharp reduction in their share of state and local support. Ten years later, voters passed Proposition 98, which guaranteed K–12 schools and community colleges a minimum percentage of the General Fund and property tax revenue. Proposition 98 guarantees that K–12 schools and the community colleges get about 40% of these allocations—and about a tenth of that share goes to the community colleges. Some have argued that Proposition 98 acts as a funding ceiling for K–12 schools and community colleges, but it also serves as a floor.

UC and CSU lack the same funding protection. While many budget areas outside of higher education are at least partially protected by dedicated funding streams, court orders, or matching federal funds, UC and CSU are vulnerable when state revenues decline. The universities have faced disproportionately large cuts in their general fund allocations during times of economic hardship. From this vantage point, a funding floor—even one that doubles as a ceiling—is preferable to a funding drop-off.

The three higher education systems also receive indirect forms of state support such as Cal Grants, fee waivers, and middle-class scholarships. Grant aid has increased for students at all institutions of higher education in California. Our best estimates suggest that community college students receive slightly more of these state funds (41% of the total in 2011‒12), than UC students (40%) and much more than CSU students (18%).

The debate over higher education funding could benefit from a clearer understanding of how the pie is divided. But the most important issue for the state’s young people is that the pie is not keeping pace with demand. Our four-year colleges have record numbers of applicants and the shares of students who are academically qualified to attend them have increased. The future prosperity of Californians and their state depends on access to higher education. To address these issues, policymakers need to focus on improving vocational programs and pathways from community colleges to four-year colleges and improving access and enrollment at UC and CSU.

Notes (TOP FIGURE): 2012-13 to 2014-15 numbers are from the governor’s budget; earlier data is from the California Postsecondary Education Commission. We include property tax allocations which are a component of the state’s obligation to community colleges pursuant to Proposition 98.

Managing Drought: Conference Videos

After a day of discussions about the drought, PPIC senior research fellow Ellen Hanak, was asked to sum up.

“This drought, as challenging as it was—as it still is—has really provided the opportunity for folks from different agencies that have different management objectives to work together to make the most out of the little water that we’ve had available.”

“It was not as bad as it could have been,” she said. “And I think that that is going to continue.”

The keynote speakers and panelists at PPIC’s Managing Drought conference this week emphasized that there is much to do to make California more drought resilient. Climatologist Mike Anderson’s description of the state’s future made the challenges clear. Panelists throughout the day discussed the difficult tradeoffs California has yet to make in managing urban and agricultural scarcity, conserving ecosystems, and allocating water.

But the discussions also highlighted a path forward. Keynote speaker Jane Doolan described lessons California can learn from Australia’s experience with its millennium drought. Our legislator panelists pointed out that California has begun to make reforms in water management that—with diligent oversight—the state can build on.

We invite you to watch the videos of the Managing Drought conference. We hope you find the discussions constructive and useful.