From the Dispatch

CAFTA Trade Lawsuit Highlights Threat To State Regulations From Bad Trade Agreements

Tim Judson — Thu, 26 Aug 2010 11:11:51 -0400

We've detailed in the past the way new international trade deals empower corporations to undermine local regulations. A recent case highlights just how byzantine and dangerous the process is getting:

A Canadian mining company is using a recently established Nevada subsidiary to use the federal Central America Free Trade Agreement (CAFTA) to try and overturn mining regulations in El Salvador.

Earlier this month, a tribunal under CAFTA ruled against the US government’s objections to the mining company's lawsuit and allowed the case to proceed.

Corporate "Investor Rights" Expanding: The case will be a high-profile test of so-called “investor state enforcement” (ISE) provisions which have become a common feature in trade agreements since NAFTA. These same investor rules are a central feature of three pending trade agreements (with Korea, Colombia, and Panama), which the Obama administration plans to finalize in coming months.

First invented as part of NAFTA, ISE rules grant companies which operate in one of the states that are party to the trade pact the right to sue another party country's government if that country’s federal or state laws and regulations impinge upon the company’s investments there. Such cases are heard by private arbitration tribunals outside of the defendant country’s legal system. These extraordinary private-investor rules grant foreign companies greater rights than domestic companies, which may not have legal basis for challenging commonly accepted public interest laws. Between 1994 and 2009, sixty-four cases were brought against countries under NAFTA, costing governments untold millions of dollars in legal expenses and amounting to billions of dollars in potential judgments. In total, governments have been found liable for over $200 million in judgments under NAFTA.

By far, the more significant implications of ISE rules are the threats they pose to the environment, workers, public health, and other public interest constituencies. In addition to the expansive opportunities they afford to multinational corporations to undermine public interest laws, they can drain government resources and create a chilled policy environment in which elected officials and public agencies feel constrained by the threat of investor-state actions. The El Salvador case is exemplary of the danger states face from the investor-state rules included in the proposed Korea-U.S. Free Trade Agreement (Korea FTA), in particular.

The El Salvador Case and the Threat to Local Regulation: The Canadian mining company, Pacific Rim Mining Corporation, is challenging a progressive mine-licensing law passed in 1996 with a two-step licensing process. First, a company must obtain a permit for exploratory mining, which Pacific Rim did in 2002. Before it can initiate commercial mining, the company must next obtain a full-scale exploitation permit, which requires approval of both an Environmental Impact Assessment (EIA) and a financial and technical feasibility study in order to protect El Salvador’s scarce potable water resources. Pacific Rim has not submitted such an application.

Pacific Rim's plans included using two tons of cyanide per day to process the ore, at a site located on El Salvador's largest river and source of drinking water. Due to the dangers posed by such mining practices, a national movement formed against precious metal extraction, and in March 2008, the conservative government led by President Elias Antonio Saca announced that no more permits would be issued until a new, thorough environmental study was completed and a mining reform law was passed.

Faced with this changing political environment, Pacific Rim decided to exploit CAFTA’s investor-state rules. At the time, however, the company had no U.S.-based operations and therefore no standing under CAFTA to sue El Salvador. So in December 2007, it reincorporated a Cayman Islands subsidiary in the state of Nevada, and in April 2008, following President Saca’s announcement, sent a letter to the Salvadoran government threatening to file suit. In December, Pacific Rim filed suit, claiming hundreds of millions of dollars in damages.

The El Salvador government filed for dismissal, but on August 2, 2010, the arbitration panel rejected the government’s position and ruled that the case will move forward. The government has since filed a second set of objections challenging Pacific Rim’s “nationality change” as an abuse of the treaty and claiming that Pacific Rim’s Nevada subsidiary is not the proper interested party, but rather the Canadian parent corporation, which has no significant investment interests in the U.S.

The case could determine how broadly ISE provisions will be extended in practice, and it illustrates the dangers to states’ sovereignty posed by future trade deals. If a multinational corporation can relocate a subsidiary to the US to undermine another FTA country’s laws, then the same could be done to undermine progressive US state laws, such as California’s new vehicle efficiency standards, that have been upheld as constitutional. The Obama administration plans to move first on the Korea FTA, which poses the greatest risk of investor-state suits of any agreement since NAFTA. Korea-based corporations have hundreds of operations located in the US, and as it is written, the Korea FTA would even enable companies to skirt new US financial reforms.

Resources

Public Citizen’s Global Trade Watch -

Progressive States Network - Trade and the States: Promoting Collaboration on Negotiating and Implementing Trade Deals

Arizona Governor Calls Special Session to Promote Anti-Union Ballot Measure

Tim Judson — Thu, 12 Aug 2010 15:13:30 -0400

Arizona continues to focus on catering to its rightwing ideological zealots rather than addressing its devastating revenue and economic crisis. The most recent example is Arizona Governor Jan Brewer calling the legislature into special session to revise Proposition 108, a controversial ballot measure that was ruled unconstitutional in its original form by the State Supreme Court last week.

Prop 108 is widely understood to be another tactic, like SB 1070, the state's anti-immigrant law, to amplify the reactionary political climate in the state leading up to the November election. Promoted by Brewer and congressional candidate Sydney Hay at the behest of the anti-union Save Our Secret Ballot Coalition (SOS Ballot), the measure sought to affirm the right of individuals to vote by secret ballot both in elections for public office and in union representation decisions. In its August 4 ruling, the court concurred with a lower court ruling on July 1 that the proposed measure violates the state constitution's requirement that amendments put to voter referendum deal with just one subject. On Tuesday, the legislature approved new language proposed by the governor, which now focuses solely on how workers choose union representation.

SOS Ballot and other front groups have been funded by organizations like the Goldwater Institute and the U.S. Chamber of Commerce to promote state constitutional amendments that purport to block one of the central provisions of the Employee Free Choice Act, introduced in Congress last year: specifically, the card-check option for certifying workers' choice to form a union. In most states where these measures have been proposed, they have been declared unfit to be placed on the ballot. And even union opponents, including the attorney representing SOS Ballot, acknowledge that EFCA would preempt the state law in private sector labor matters.

However, in addition to its symbolic value, Prop 108 would block efforts to establish card-check for public sector workers. That effect is not merely collateral or ironic – it goes against empirical evidence demonstrating the need for a card-check option for all workers. In-depth studies of employer and union tactics in organizing campaigns show that so-called "secret ballot" elections under the National Labor Relations Act are anything but secret: employers typically use their sway over employees in the workplace so that there are no surprises in the union vote.

Dr. Kate Bronfebrenner of Cornell University has begun publishing results of the most comprehensive survey of union organizing campaigns ever conducted. The study shows that private-sector employers routinely interrogate employees at work in the weeks leading up to union elections: in two-thirds (66%) of private-sector organizing drives, workers are forced to attend one-on-one meetings with their supervisors on at least a weekly basis; in 63% of organizing drives, supervisors use such meetings to interrogate workers about their union preference, and in most cases (54%) supervisors threaten employees into opposing the union.

In contrast, in states with public sector labor relations laws (which often include a card-check certification option), employees are only subjected to supervisor one-on-one meetings in 26% of organizing drives (compared to 77% in the private sector) – almost never (2%) on a weekly basis – and interrogation and intimidation in such meetings are far less common (20% and 15%). Furthermore, the evidence suggests that fears of coercion by unions under card-check are unfounded: a four-state survey of over 1,300 public sector card-check cases found only five allegations of union misconduct or coercion and only one confirmed case.

UPDATE: Pro-labor legislators offered several amendments to the ballot measure to expose the anti-worker agenda behind it. One amendment would have given workers the right to have a co-worker present during meetings with their supervisors in order to curb the potential for such one-on-one meetings to be used for interrogation and intimidation. Rep. Daniel Patterson proposed amendments requiring secret ballot elections for corporate boards of directors and exempting public safety officers from the card-check prohibition; when those failed, he proposed an amendment renaming the ballot measure "The Arizona Anti-Worker Amendment." In the Senate, legislators introduced a bill to deny legislators per diem payments for the special session -- which would save the state over $12,000. That bill was defeated as well.

Wage Theft by Employers Surging in Wake of Arizona’s Anti-Immigrant Law, Even as Judge Blocks Implementation of Key Provisions

Suman Raghunathan — Thu, 29 Jul 2010 11:44:07 -0400

The Arizona Interfaith Alliance for Worker Justice, a worker center in Phoenix, has seen a “huge spike” in wage theft -- violations of minimum wage laws -- since the passage of SB 1070, Arizona’s anti-immigrant law. "Employers are even more brazen in their mistreatment of workers," said Executive Director Trina Zelle in an interview with In These Times. "Increasingly, 'Go ahead, try and make me pay you' is the response workers hear when they confront their employers over unpaid wages."

Workers' rights organizers report that the law's passage in April has already begun to drive immigrant workers even further underground, effectively silencing them in the face of rampant workplace rights violations. The irony is that this makes undocumented immigrants an even more attractive workforce for unscrupulous employers, who know they can illegally underpay them without fear of those employees reporting them or taking them to court. “If we ever hope to bring immigrant workers out of the shadows in which they’ve been laboring,” says Kim Bobo, Executive Director of Interfaith Worker Justice, “we need to forcefully oppose anti-immigrant legislation and stand up for both comprehensive immigration reform and vigorous enforcement of the nation’s labor laws.”

Progressive States Network's model legislation for wage law enforcement outlines how wage enforcement campaigns can counter anti-immigrant rhetoric by raising wage standards for all workers and uniting native and immigrant communities to oppose unscrupulous employers.

Judge Strikes Down Worst Provisions of SB 1070: Yesterday, a federal judge struck down key provisions of SB 1070 as likely violating federal law or being unconstitutional, reinvigorating hope among immigrant communities that state anti-immigrant laws will fail to gain traction. Key provisions that were blocked include:

Requiring police officers to investigate the immigration status of individuals they stop who they suspect are undocumented;
Mandatory detention of individuals who are arrested if they cannot verify they are authorized to be in the U.S.;
Imposing state criminal penalties on non-citizens who fail to register with the Department of Homeland Security or failing to carry registration documents;
Warrantless arrests of individuals who are deemed by state or local police officers to be "removable" from the U.S.; and,
State statutes that make it a crime for alleged undocumented immigrants to work.

The initial court injunction will be followed by a full hearing to determine whether these provisions, as well as the law's other troubling components, will be permanently struck down. The ruling echoes numerous other legal decisions that struck down broad state anti-immigrant laws - and should serve as a warning to other states that enacting copycat legislation similar to Arizona's will lead to costly legal proceedings and, as discussed above, only serve to empower unscrupulous employers to violate wage laws.

Resources:
Working In These Times - ‘Go Ahead, Try and Make Me Pay You’: Wage Theft and SB 1070
Progressive States Network - Promoting Wage Law Enforcement Policies in 2010
Interfaith Worker Justice - Thou Shalt Not Steal - A Toolkit on Wage Theft
American Civil Liberties Union (ACLU) - Court Blocks Implementation of Key Sections of Arizona's Racial Profiling Law
National Employment Law Project (NELP) - Enforcement of Workplace Standards

Extended Unemployment Benefits Approved by Feds

Altaf Rahamatulla — Thu, 22 Jul 2010 11:10:43 -0400

Extended Unemployment Benefits Approved by Feds - But Debates Continue on Raiding Already Approved Recovery Funds

This week, the U.S. Senate finally broke a filibuster by conservatives to approve an extension of unemployment insurance (UI) for 2.5 million people who lost their benefits when the program expired last month. The House is expected to approve the bill today, which extends the program through November, offering the long-term unemployed up to 99 weeks of aid and making benefits retroactive to June 2 when the program expired.

However, UI is only one part of job creation. Congress is currently considering further aid for state programs such as schools and Medicaid. Many opponents of state fiscal relief continue to demand that the government rescind other recovery funds to pay for programs, effectively calling for the firing of one set of workers to promote employment and services for other groups. Furthermore, it is quite telling that right-wing representatives who are purportedly concerned with the deficit, took issue with how the government would pay for the UI extension, but desire to maintain the Bush tax cuts, which are major sources of the long-term deficit and as the Center on Budget and Policy Priorities indicates, "will continue to harm the budget outlook throughout the next decade."

Robbing Broadband to Pay for Schools: Just this month, for example, the House approved an Appropriations Committee amendment to the supplemental war bill that would have added funds to avoid massive teacher layoffs along with funding for expanded Pell Grants, the Gulf Oil Spill, and other programs, but paid for this aid through $11.7 billion in cuts in other programs. With inflated deficit hysteria poisoning the debate, the amendment cut funding for a special Supplemental Nutrition Program for Women, Infants, and Children, some other education programs, and cut over $700 million from key broadband and technological investments allotted in the Recovery Act, including $602 million the Departments of Agriculture and Commerce for broadband grants, $112 million in funding for digital television, and $15 million for National Institute of Standards and Technology (NIST) construction. Several advocates are concerned that a loss of crucial funding for broadband will compromise economic development, growth, and access provisions to un-served and under-served areas of the country. On top of that, due to current state budget shortfalls, ARRA broadband investments are the only direct source of funding states have at their disposal to improve and expand high-speed Internet access.

Jobs Now, Plan for Deficit Reduction Later: With unemployment hovering at 10 percent, most economic experts see the focus on short-term deficits as misguided and dangerous, since, if anything, we need more immediate spending to create jobs, not less. As Lawrence Mishel, the president of the Economic Policy Institute, and David Walker, the president and CEO of the anti-deficit Peter G. Peterson Foundation, relate jointly in a recent article, the nation can effectively engage in planning for long-term deficit reduction even as we run short-term deficits to create jobs that promote systematic federal investments in public structures, education, and benefits for the long-term unemployed as a means to spur recovery and future fiscal stability:

A focus on jobs now is consistent with addressing our deficit problems ahead... We must accept higher deficits in the short-term in order to put people back to work. At the same time, we must take immediate steps to agree on a path and a process for reducing the structural deficits that lie ahead.

Cutting short-term recovery dollars now does little or nothing to deal with long-term structural deficits and not definitively moving on necessary job creation measures can prolong economic pain and likely make those long-term deficits worse. So as Mishel, Walker and a range of other experts emphasize, the short-term spending cuts suddenly being debated in Congress are a distraction from both immediate economic recovery and from any genuine debate on long-term deficit reduction.

Resources:
Committee on Appropriations - House Consideration of the 2010 Supplemental Appropriations Act: Amendment on Fully Offset Education
Education Week - Some State Officials Worried About Race to Top Cut
Lawrence Mishel and David Walker - Address Jobs Now and Deficits Later
Milwaukee-Wisconsin Journal Sentinel - Obey Pushing for $10 Billion to Save Teacher Jobs
Progressive States Network - Broadband and Recovery
Stimulating Broadband - Alert: House Appropriations Cuts $602 Million from Broadband Stimulus
United States Senate - Bayh Letter to Inouye

Clean Energy Options: In the Wake of the Oil Spill, Energy Alternatives That Will Create Jobs

Fabiola Carrion — Mon, 19 Jul 2010 14:00:58 -0400

With less than 5 percent of the world’s population, the United States produces 25 percent of greenhouse gases, making it the second largest emitter in the world after China. The American public is well-aware of this issue; according to a Pew Research Center Poll, three-fourths of Americans described climate change as a serious problem. Since the oil spill in the Gulf of Mexico, support for off-shore drilling has waned substantially and more Americans want to look for clean energy policies that will avert more ecological disasters. Pew has also noted that the American public overwhelmingly supports (by 87 percent) renewable sources like wind and solar power.

Accompanying this environmental crisis is one of the worst economic periods in the nation's modern history. Overall unemployment rates are just below 10 percent and almost all states are dealing with budget shortfalls. Progressive state legislators, nevertheless, continue to take major steps to lessen our dependence on oil, create jobs that remain in this country, diversify our energy sources, and ensure that these sources are transmitted and distributed through a reliable electrical system.

States have taken an important – and often primary – role in setting the environmental and energy agenda in the United States. A review of state policies, federal policies based on state models, and federal policies where state leaders play a key role in implementation demonstrates that state actions will have reduced carbon dioxide emissions by approximately 536 million metric tons per year by 2020. As Progressive States Network has described in previous Stateside Dispatches, increasing the number of renewable energy systems reduces greenhouse gas emissions, relieves grid congestion, creates jobs, and provides their owners with surplus energy to sell back to the market.

In this Dispatch, PSN will examine clean energy options that contribute to a green economy, including evaluating the great strides that energy supply alternatives have created in the states that have enacted policies that promote them. We will explain how states have established Renewable Portfolio Standards and how these have created the demand for innovative investment, as well as how to promote new sources of renewable energy, including creative financial mechanisms, multi-state agreements, and the upgrade of an electrical grid that will better transmit energy from these intermittent sources. And for states looking for new job creation strategies, one key fact is that the production, installment and maintenance of renewable energy sources create sustainable jobs.

Federal Support for State Action: The 2009 American Recovery and Reinvestment Act (ARRA) assisted continued action by states with the inclusion of a wide array of provisions to spur clean energy generation and energy efficiency. A special package of $85 billion was allocated towards energy and transportation related spending, dedicating $21 billion toward incentives for wind, solar, and other renewable energy manufacturers. ARRA also provides more than $30 billion for direct spending on clean energy programs, including $11 billion to modernize the electricity grid, $2.5 billion for research into renewable energy, and $6 billion for state and local efforts to achieve energy efficiency. In addition to all of these national efforts, ARRA allocates $3.1 billion to the Department of Energy’s State Energy Program, which distributes funds to help state governments improve energy efficiency and expand the use of renewable energy in their states. According to Environment America, programs that have been funded by ARRA are expected to reduce emissions by approximately 10 million metric tons per year by 2020.

Resources
Environment America - America on the Move: State Leadership in the Fight Against Global Warming, and What it Means for the World
American Clean Energy and Security Act
Clean Energy Jobs and American Power Act

Table of Contents:

- Renewable Energy Sources in the States

- Renewable Portfolio Standards: One Key to Promoting Alternative Energy Production

- Putting a Price on Carbon: Regional Greenhouse Gas Emission Agreements

- Clean Energy Financing Options

- Networking the Green Economy: Creating Jobs and Improving the Transmission of Renewable Energy Sources

- Conclusion: A Greener Economy Drives Job Creation

Renewable Energy Sources in the States

Renewable energy sources (used interchangeably here as alternative energy sources) include solar, wind, geothermal, biofuels, geothermal, conventional hydroelectric, and biomass waste. The production of renewable energy largely depends on the geographic location of these resources, the availability and location of infrastructure, and demand for energy. As such, the two most common barriers for the development of alternative energy sources are (1) cost, and (2) lack of infrastructure.

Solar Energy: Pike Research forecasts that the United States will become the largest market for small solar installations by 2011, surpassing Germany, the best known solar energy producer in the world. Unlike fossil fuels, solar energy is clean, safe and everywhere. With higher demand, solar energy is costing less. Thanks to this rapid growth, it is believed that the US can reach the goal of obtaining 10 percent energy consumption from the sun by 2030. One of the drawbacks of solar energy, however, is that it is intermittent and consequently not always available to match demand. It is therefore imperative that we use technologies that can measure the various levels of power that solar energy can generate and transmit them according to on- and off-peak times.

Wind Energy: Wind energy has become the fastest growing source of electricity in the United States. In fact, in 2008, the US surpassed Germany to reclaim the world’s leadership in installed wind power capacity. And in 2009, the wind industry increased by 39 percent. Now, almost two percent of our electricity is coming from wind turbines. Further, about half of components used in wind farms are now made in the US, compared with 25 percent in 2004, meaning that jobs in this sector have increased rapidly.

Thanks to our transition into wind generation, the US Department of Energy attributes approximately 17 million metric tons of the decline in carbon dioxide emissions during 2009 to expanded production of zero-emission electricity compared to 2008 levels. Environment America also concludes that the increase in renewable energy production since 2004 could be assumed to have reduced emissions in 2009 by roughly 44 million metric tons. Texas is currently the nation’s top wind producer, with a total of 9,410 megawatts, about three times more than the second-largest producer, Iowa. They are followed by California, Washington, and Minnesota.

On their own, solar and wind power can significantly reduce the amount of greenhouse gases we normally emit, and together, they can complement each other. Under the right conditions, solar generated energy is at its highest output during the hours when wind resources are least likely to be available.

Resources
Center for Social Inclusion - Solar Energy Generation at the Community Level: Briefing Paper Five of Black, Brown and Green
The New York Times - Wind Power Grows 39% for the Year
US Department of Energy - Short‐Term Energy Outlook Supplement: Understanding the Decline in Carbon Dioxide Emissions in 2009

Renewable Portfolio Standards: One Key to Promoting Alternative Energy Production

A renewable electricity standard (also known as renewable portfolio standard) requires utilities to develop renewable energy resources as part of their energy portfolio. In other words, an RES (or RPS) requires utilities to obtain a certain share of electricity they deliver to consumers from renewable resources. Twenty-nine states and the District of Columbia have adopted minimum standards requiring that a percentage of their electricity come from renewable energy. Five additional states (Florida, North Dakota, South Dakota, Utah, and Virginia) have set voluntary renewable portfolio standards.

Thanks to these standards, about three percent of power generated in the United States originates from renewable energy sources. The Department of Energy attributes state laws as the force behind the use of renewable sources. In concurrence, research by the North American Electricity Reliability Council shows that over 50 percent of the increase in renewable energy capacity occurred in states with mandatory Renewable Portfolio Standards.

These efforts will reduce global warming pollution by 79 million metric tons nationwide. Environment America calculates that 119 million metric tons will be reduced by 2020 thanks to RES policies and the reductions in electricity consumption that will result from other related policies.

Renewable Energy Standards Vary from State to State: The mix of resources eligible for credit varies greatly from one state to the next: some include “carve outs” for particular technologies (most often solar power), and some allow out-of-state resources to count on an equal basis with in-state resources through credit trading. Each state has designed its RES to account for a range of state-specific conditions and policy priorities. These include available wind, solar and other renewable energy potential in a state, reducing greenhouse gas emissions, mitigating other environmental externalities associated with fossil fuels, and lowering electricity costs to consumers. Other goals include diversifying the energy mix to protect against potential fuel interruptions and attracting wind and solar farms, product manufacturers, and research and development facilities to promote economic development and job creation.

The first renewable energy standard was adopted in Iowa in 1983. Massachusetts, Nevada, Connecticut, Maine, New Jersey and Wisconsin followed suit in the late 1990s, all enacting standards in the space of a few years. RES spread even more widely in the 2000s, while many states that had been among the first to adopt the policy updated their legislation to enact more aggressive renewable energy goals and to ease implementation of the policy.

Even when states have already implemented renewable portfolio standards, they are still seeking to expand them. States have expanded compliance dates, raised compliance targets, or added carve-outs for specific technologies.

Oregon’s HB 3039, enacted into law in 2009 two years after the renewable portfolio standard was first signed, includes a solar photovoltaic standard within the state renewable portfolio standard. Oregon state legislators continue to seek to amend existing laws to increase RPS requirements over the years.
In 2002, Nevada enacted an aggressive renewable portfolio standard that required that 15 percent of all electricity generated be derived from renewable resources by 2013. In June 2005, Nevada raised the requirements of the RPS by 20 percent of sales by 2015.
Virginia also increased the state’s renewable portfolio standard to 15 percent during the 2009 legislative session.

We previously highlighted Colorado's leadership in clean energy legislation, including its recent law to expand its renewable energy standards. In one of the most far-reaching environmental initiatives in the country, HB 1001 requires 30 percent of large utilities' electricity to come from renewable energy sources by 2020. In detail, utilities must supply at least 12 percent of their retail electric sales from such sources from 2011 to 2014, 20 percent from 2015 to 2019, and 30 percent for 2020 and beyond. Three percent of this standard must be met by local solar power, leading to the construction and installation of 100,000 solar rooftops, panels, and turbines.

The Undeniable Success of a Renewable Energy Standard: Seventy percent of the fastest growing energy supply -- wind power -- was generated in the US thanks to a renewable energy standard. Between 2004 and 2009, state mandates for renewable energy have averted the release of approximately 44 million metric tons of carbon dioxide pollution in 2009. By requiring utilities to invest in renewable energy, states have established policies that have leveled the playing field for clean energy sources to compete with traditional fossil fuel.

Experts project that the manufacturing renewable sector has the potential to employ many more Americans in green jobs. Of the 18 states that have both renewable portfolio and energy efficiency standards in place, 11 states (61 percent) had more jobs in the clean energy economy than the national average. Similarly, in 12 of those 18 states, clean energy jobs made up a larger share of all jobs when compared to the US average.

Resources
Progressive States Network - Renewable Portfolio Standards (RPS) Advance in the States
Center on Wisconsin Strategy, the Workforce Alliance, the Apollo Alliance - Greener Pathways: Jobs and Workforce Development in the Clean Energy Economy
Stateline - The Rush to Renewables
Center for Social Inclusion - Solar Energy Generation at the Community Level: Briefing Paper Five of Black, Brown and Green
Environment America - America on the Move: State Leadership in the Fight Against Global Warming, and What it Means for the World
Progressive States Network - Colorado Leads Clean Energy Reform
Environment Maryland - Building a Solar Future: Repowering America's Homes, Businesses, and Industry with Solar Energy
Apollo Alliance - As Oil Spill Tragedy Continues, Clean Energy Progress in Missouri and Georgia Points to Hope for the Future
Renewable Energy World - Where the Wind Blows and Sun Shines: A comparative analysis of state renewable energy standards

Putting a Price on Carbon: Regional Greenhouse Gas Emission Agreements

In addition to complying with their own statewide portfolio, twenty-three states are participating in three major regional initiatives seeking to increase renewable energy generation and reduce carbon pollution from power plants that cause global warming. The most famous of these agreements is the Regional Greenhouse Gas Initiative or RGGI, composed of 10 Northeastern states: New York, Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, and Rhode Island.

RGGI's 2002 Working Group proposed to keep emissions flat from 2009 to 2015, and then begin to cut the cap by 2.5 percent each following year. By 2018, emissions are expected to be reduced by 10 percent from the program's start date. RGGI holds an auction where the member states sell credits for carbon emissions. The buyers are electric utilities who purchase credits either to be able to emit carbon dioxide or to re-sell those credits to other utilities. Under this cap-and-trade regime, each auction raises on average $80.5 million and in total the auctions have raised $663 million. The money raised in these auctions is supposed to be directed towards projects that promote energy efficiency.

Although some states have used some of the RGGI funds to fill in the gaps of their state's budget, the RGGI still continues to create job opportunities for workers who conduct energy audits and install home weatherization measures. For example, the Center for Ecological Technology, a company that conducts RGGI-funded efficiency efficiency work on behalf of electric utilities has doubled its workforce - from 50 to 100 full-time employees. This increase has also spearheaded the creation of new positions in the IT and customer service departments. Furthermore, thanks to RGGI, carbon dioxide emissions from power plants are below the cap they set. Along with RGGI, the Western Climate Initiative (WCI) has been created to reduce emissions across the region by 15 percent below 2005 levels by 2020. Seven US states (Arizona, California, Montana, New Mexico, Oregon, Utah, and Washington) and four Canadian provinces are part of WCI; the program, to be fully implemented by 2015, will cover close to 90 percent of emissions from the states' and provinces' territories. Also in the Midwest, six US states (Iowa, Illinois, Kansas, Michigan, Minnesota, and Wisconsin) and a Canadian province have joined to form the Midwest Greenhouse Gas Accord in order to reduce their emissions. MGGA's Advisory Group recently published its final recommendations, setting an emissions reduction target of 20 percent below 2005 levels by 2020.

Altogether, 23 states, accounting for half of the US population, are involved in greenhouse gas reduction accords.

Other Ways to Put a Price on Carbon: The most straightforward, and many would argue transparent, method to curtail carbon emissions might be to pay precisely for producing them. A carbon tax is aimed at taxing the actual emissions of carbon dioxide from energy producers. Instituting a tax provides the certainty of compliance, and has been successfully implemented in several countries, including Norway, Sweden and Germany. Carbon tax legislation has been introduced in US cities like Portland, Oregon and Boulder and Aspen in Colorado. According to the Oregon plan, builders that do not construct an energy efficient home must pay a fee. By the same token, the plan gives developers cash rewards if they save at least 45 percent more energy than the Oregon building code would require. The Boulder plan charges on the number of kilo-watt hours used, directing the profits to renewable energy and energy efficiency programs. The idea of taxing for carbon emissions has received a lot of support from environmental and labor activists, and even from Exxon CEO Rex Tillerson.

Please click image above to view a full chart of state Mandatory Renewable Energy Standards for 2010 from RenewableEnergyWorld.com.

Resources
Stateline - The RGGI raid: how cap-and-trade revenues went to fix state budgets
Progressive States Network - Bold Plan for Carbon Tax Introduced in Portland, OR
Environmental Protection - First RGGI 2010 Auction Yields $87.9 M for Member States
Regional Greenhouse Gas Initiative
Western Climate Initiative
Midwestern Greenhouse Gas Reduction Accord

Renewable Energy Financing Options

Through public bonds, pension funds, state-managed investment pools, and leveraging federal dollars, states can direct investment dollars into alternative energy production. These financial incentives are being applied over a long period of time to establish consistent and efficient programs and create a stable market.

Federal and State Funding: Federal monies, principally through the ARRA, are being directed towards bonds that enable local and states to finance renewable energy projects. The US Department of Agriculture, for instance, operates a loan guarantee program for agricultural adoption of renewable energy. States are taking full advantage of the federal government's support. Thirty-two of them have combined federal and state funding to provide residential, commercial, and industrial loan financing for the purchase of renewable energy. The following examples paint a good picture on what states are doing with government funding:

In Colorado, SB 31 was enacted in 2009 to create the Clean Technology Discovery Evaluation grant program for the purpose of improving and expanding the development of new clean technology discoveries at higher education research institutions. The state will also allocate $2 million in grants towards renewable from 2009 ARRA funding through the Governor's Energy Office.
Montana also provides direct funding for renewable energy development through grant and loan programs that typically target generation at the scale of residential and commercial buildings. It offers a grant program to subsidize small-scale renewable installations via a state-mandated system benefits fund maintained by the state’s largest private utility. Montana’s revolving fund loans up to $40,000 per renewable project.

Municipal Financing and Property Assessed Clean Energy (PACE): A model called Property-Assessed Clean Energy (PACE) financing enables municipalities to use their ability to obtain financing at low interest rates to pay for the upfront cost of installing renewable energy parts in businesses and homes. The financing is recouped through a special assessment on the property owner’s taxes, or in certain cases, their utility bill. In most programs, property owners pay back the costs over a period of 20 years. The tax remains with the property; if a property owner sells the property during the period of financing, the responsibility to pay back is transferred to the new owner. Hence, PACE absolves the homeowner of the risk that they will move out before they receive the full benefits of the system. Two barriers to making energy upgrades are therefore eliminated: (1) the up-front costs, and (2) the question of who pays for ongoing costs for upgrades when properties are sold.

The White House has estimated that if only 15 percent of residential property owners in the US took advantage of PACE related programs, the resulting emissions reductions would contribute to four percent of the savings needed for the US to reach 1990 emissions by 2020. In addition to reducing greenhouse gas emissions, PACE programs promise to lower energy bills for consumers and create jobs in home weatherization and renewable energy installation. So far, PACE programs have been authorized in 23 states.

Source: Pew Center on Global Climate Change

California enacted AB 811 in 2008 to allow cities and counties to offer PACE financing. Under the California program, property owners seeking funding for energy efficiency improvements must have a clear property title and be current on property taxes and mortgages. Financing may originate from bonds, local government funds, and third-party lenders. Under Minnesota law, loan amounts may not exceed 10 percent of the assessed value of the property and may include costs related to the required energy audit or feasibility study, equipment and labor costs, and performance verification. A recently enacted New York law (AB 40004A) allows counties, towns, cities and villages to offer sustainable energy loan programs that can pay for energy audits, cost-effective, permanent energy efficiency improvements, renewable energy feasibility studies, and the installation of renewable energy systems. The local program determines the sectors eligible for financing, and qualification for the loan is contingent on energy audits or renewable energy feasibility studies that meet New York State Energy Research and Development Authority (NYSERDA) or equally stringent standards. Energy efficiency improvements must meet cost-effectiveness criteria as established by NYSERDA. Land-secured financing districts for PACE programs have been created in Florida, Georgia (HB 1388-2010), Hawaii, Louisiana (SB 224-2009), Nevada, Vermont (HB 446-2009), and New Mexico (SB 647-2009).

Also last year, Oregon established the Energy Efficiency and Sustainable Technology loan program to provide state loans for residential and commercial energy efficiency and renewable energy projects. The 100 percent upfront long term, low-interest loans can be paid back on the utility bill. The program is financed through state bonding and private loans.

This year, Maine enacted LD 1717 to implement a loan program through a local ordinance that provides financing for property owners who want to put clean energy improvements in their homes. This legislation is unique in two ways: (1) municipalities will be able to use federal grants or any other funds available for the purpose of funding PACE programs; and (2) PACE assessments will be considered subordinate liens, secondary to mortgages. Further more, Efficiency Maine Trust was directed to promulgate rules for Maine's PACE program, including eligible efficiency improvements and renewable energy installations, standards for underwriting requirements, and truth in lending provisions which are to guide the consumer disclosure that must be included in PACE agreements.

Another eight states have introduced PACE bills in 2010 in their legislatures, including Hawaii (SB 2865 and HB 2643), Missouri (HB 2178, HB 2298 and SB 1037), Michigan (HB 5640), New Jersey (AB 2500), Illinois (SB 2505).

Georgia also approved legislation this year (HB 1388) to help residential and commercial property owners make energy efficiency and renewable energy improvements to their properties through voluntary property assessments.

PACE Programs Under Challenge: Recently, Fannie Mae and Freddie Mac asserted that because PACE programs' liens take priority over existing mortgages, this poses a risk to lenders and secondary market entities, as well as alter valuations for mortgage-backed securities. Consequently, the Federal Housing Finance Agency (FHFA) and the US Treasury Department have instructed banks to place additional restrictions on home loans to borrowers in jurisdictions that have PACE programs. In response, cities and states have taken action to save PACE.

For instance, the state of California has filed a complaint against Fannie Mae and Freddie Mack for blocking PACE programs; California Attorney General Jerry Brown argues that PACE funding is an assessment, not a loan, and that Fannie and Freddie have long accepted local governments' use of assessments in California to finance improvements that serve a public purpose. The city of Babylon in New York will likely follow California's action; its leaders joined more than 50 local workers at a rally last Tuesday to announce the town's plans to sue the FHFA. As these leaders note, programs like those in California actually work to reduce the risk of default by requiring a clean record on property taxes and mortgages. In New York, stringent standards have to be met in order to obtain financing under PACE. And in Maine, the Efficiency Maine Trust is creating standards for underwriting requirements and truth in lending provisions to guide consumer disclosure. Further, more federal money is being allocated to fund and guarantee the success of PACE programs. Last year, the US Department of Energy announced funding for PACE projects and is apportioning $80 million as upfront capital for PACE-type programs. PACE programs can also apply for competitive grants under the Energy Efficiency Conservation Block Grant Program.

Feed-In-Tariffs: One other funding source for renewable energy is where a company that installs and maintains a renewable source device receives a Power Purchase Agreement or Feed-In-Tariff with a customer. Here, the customer pays no upfront costs while the energy provider pays for the entire project including installation, maintenance, and trouble shooting. Also, this relationship guarantees that the installation can take place quickly, the service is predictable, and the rate is at parity with other retail electricity rates. Feed-in tariffs have played a role in the development of Germany’s world-leading solar power industry. In the United States, feed-in-tariffs have been adopted in Vermont and Washington.

The Vermont feed-in-tariff law was designed to ensure that homeowners or businesses receive the same return on equity for their investment. Vermont's legislation bases the tariffs on the cost of generation plus a reasonable profit. Vermont's feed-in tariff program contains the key elements of the successful policies found in Europe: tariffs are differentiated by technology and size; tariffs are set on the cost of generation plus profit; and profit is set by a reasonable rate of return, loan contracts terms, and a regular program review.

Rebate Programs: By providing cash incentives, more homeowners and businesses will install renewable devices and technologies in their buildings. States have taken note of this efficient strategy. Twenty-three of them and the District of Columbia offer rebate programs to promote the installation of renewable energy systems and energy efficiency measures such as solar water heating and photovoltaic systems. We highlight a few of them:

California's Million Solar Roofs Initiative provides grants to homeowners who install solar systems, with the amount of the rebate declining over time to reflect the anticipated declining cost of solar power.

Thanks to ARRA funding, Minnesota offers rebates of $100 to $250 on refrigerators, dishwashers, and clothes washers, and New Jersey residents will be able to receive rebates worth $25 to $ 100 on the purchase of those same items. Similar rebate programs for home appliances exist in Louisiana, North Carolina, and South Carolina.

Net Metering: Net metering allows customers who generate electricity through renewable sources to receive credit for electricity they put on the grid. In other words, net metering customers buy electricity when they need it, use the electricity they produce, and sell any excess to the utility. This provides an incentive for consumers to invest in small renewable generation systems. More than 40 states and the District of Columbia have adopted net metering laws.

Last year, Nebraska's LB 436 was enacted to provide net metering for electricity. It includes one to one credit for energy generated up to the amount used, protection against additional utility charges and fees, protection against unnecessary safety or performance standards, and prohibition of additional liability insurance.
Newly enacted AB 510 in California raises the cap set on the number of homes and businesses that can take advantage of net energy metering. Current law caps the amount of electricity that can be generated under the net metering program to 2.5 percent of a utility’s peak demand. AB 510 raises the net metering cap to 5 percent and will help meet projected demands received under the California Solar Initiative program. The law further allows the rate-making authority to compensate net energy producers for the value of the electricity itself, and the value of the renewable attributes of the electricity. Moreover, net energy producers will receive a bonus if the renewable attributes of the energy production add indefinite or unforeseen benefits. Environmental advocates claim that the law, which was introduced last year but died in committee, finally balances the interests of utilities, customer-generators, and non-participating customers. This is a great win for the more than 50,000 customers, including schools, community colleges, cities and counties and homeowners in California who participate in net metering.
New Jersey has one of the most comprehensive net metering and interconnection laws in the United States. It includes a wide array of renewable sources: solar technologies, wind, fuel cells, geothermal technologies, wave or tidal action, and methane gas from landfills or biomass facilities. This program has been praised for standardizing the interconnection procedures for residential and small-commercial customers, who pay at the end of the each year for every excess Kwh they produce.

Protecting the Ability to Install Renewable Energy Sources: States are also enacting rules to protect access to renewable energy. Last year, Virginia enacted SB 320, which voids covenants that restrict installation of use of any solar energy collection device on private property.

Resources
Progressive States Network - Colorado Leads Clean Energy Reform
The Pew Charitable Trusts - The Clean Energy Economy: Repowering Jobs, Businesses and Investments Across America
The Apollo Alliance - As Oil Spill Tragedy Continues, Clean Energy Progress in Missouri and Georgia Points to Hope for the Future
The White House - Policy Framework for PACE Financing Programs
Environment America – America on the Move
Center for Social Inclusion - Solar Energy Generation at the Community Level: Briefing Paper Five of Black, Brown and Green
Progressive States Network - Green Buildings: Multi-State Agenda Campaign Update
Apollo Alliance - Efforts Underway to Save Property Assessed Clean Energy (PACE) Programs
The White House - Policy Framework for PACE Financing Programs
Center on Wisconsin Strategy, the Workforce Alliance, the Apollo Alliance - Greener Pathways: Jobs and Workforce Development in the Clean Energy Economy
Environment Maryland - Building a Solar Future: Repowering America's Homes, Businesses, and Industry with Solar Energy

Networking the Green Economy: Creating Jobs and Improving the Transmission of Renewable Energy Sources

Renewable sources present unique and serious transmission challenges due to their intermittency (solar and wind) and the remoteness of the site of generation. For renewable energy production to maintain its current rate of growth, it must overcome significant obstacles, including the lack of capacity and connectivity in the regional electrical infrastructure. The only way that we can fully maximize the use of renewable energy sources is by upgrading the current electrical system. With an upgraded, or smart, grid, renewable energy production overcomes significant obstacles including lack of capacity and connectivity. Improving the electric grid will expand the ability of renewable energy and energy conservation to meet the nation’s energy needs.

The smart grid is an aggregate term that refers to a distribution system that allows the flow of information to the consumer and to the utility company through thermostats, Web based programs, appliances, and other devices. Establishing smart grids at the transmission level will enable digital controls and high-voltage transmission lines to transport energy from renewable energy sources. A smart grid improves the management of the distribution and consumption of energy that results in the integration of various sources of renewable energy into our power system. In this manner, it facilitates more efficient energy use and reduces the amount of emissions from harmful greenhouse gases.

The American Recovery and Reinvestment Act apportioned $4.5 billion on smart grid demonstration projects. Beyond this, $11 billion will be invested in general improvements to the grid, another important step towards a grid that will allow for more flexible and efficient generation and use of power.

Last year, California enacted SB 17/AB 238 to declare that new and modified electric transmission facilities, including the employment of smart grid technologies, are necessary to facilitate the state's energy efficiency goals and renewable portfolio transmission facilities. This is the first smart grid state law in the country, as it promotes the installation of smart meters, data networks and other infrastructure for a cleaner, more efficient electrical grid by — by July 1, 2010. Under this law, the Public Utility Commission is required to report on a yearly basis, starting on Jan. 1, 2011, to the governor and legislature on the progress being made in improvements to the electrical grid.
Vermont and Maryland have each provided funding to study smart metering and/or smart grids, as a means of reducing energy use.
The Pacific Northwest National Laboratory (PNNL) has teamed with utilities in the states of Washington and Oregon to test new energy technologies designed to improve efficiency and reliability, while at the same time, increasing consumer choice and control.
In North Carolina, 100 Lafayetteville residents and businesses cut energy use an average of 20 percent during a six-month pilot last year. The customers were equipped with software that enabled them to check their energy use from the Internet.

By using applications and devices supported by digital infrastructure, such as broadband and information communication technology, we can build a green economy:continuing our economic growth and creating new jobs while decreasing our energy consumption and greenhouse gas emissions.

Resources
Progressive States Network - Networking the Green Economy: How Broadband and Related Technologies Can Build a Green Economic Future
Progressive States Network - Green Jobs Programs to Drive Economic Recovery
The Apollo Alliance - Make It in America: The Apollo Green Manufacturing Action Plan
Progressive States Network - Networking the Green Economy: How Broadband and Related Technologies Can Build a Green Economic Future

Conclusion: A Greener Economy Drives Job Creation

Nearly six out of ten jobs in the green economy fall specifically in the area of energy generation, which includes jobs responsible for producing clean forms of energy such as wind, solar and geothermal. Jobs responsible for solar power generation dominate this subgroup: 62.5 percent of all energy generation jobs in 2007 were in the solar industry. Jobs in wind power were second overall, making up 9.7 percent of energy generation jobs in 2007, but they grew more rapidly – by 23.5 percent between 1998 and 2007, compared to 19.1 percent growth for solar power jobs during the same period. Since the ARRA was enacted, an estimated 150,000 jobs were saved or created in the construction of solar panels and wind turbines.

Industry sector experts have cited state policies such as renewable portfolio standards as important factors in driving investments, attracting companies and growing new industries and jobs because they help create market demand for clean energy technologies, products, and services. However, without key policies such as renewable electricity standards, the market will be slow to grow. The Union of Concerned Scientists agree; they have estimated that a national RPS requiring 20% in renewable energy sources by 2020 could generate 355,000 jobs across the country. Also by this time, the domestic market for renewable energy supplies is likely to reach $226 billion annually.

Potential Federal Action: While states are still making progress on their own, a stronger federal partner would help. Last year, US Representatives introduced the American Clean Energy and Security Act, which requires that 20 percent of the country’s electricity be generated by renewable energy by 2020. This year, the Clean Energy Jobs and American Power Act (also known as the APA) was unveiled in the Senate. The APA includes: a cap and price on greenhouse gas emissions, similar to a cap-and-dividend already considered at the state-level, a target for reducing those emissions to 17 percent below 2005 levels by 2020 and 80 percent below 2005 levels by 2050, and a fee for “carbon leakage” of imports in order to level the playing field between American manufacturers and foreign competitors that emit carbon. Not included in the Senate bill is a national renewable portfolio standard. Although the APA offers support for renewable energy sources, a federal mandate is needed in order to push the remaining 20 states to seriously commit to the use of alternative sources of energy. In the absence of renewable energy standards in the American Power Act, states can and must continue to fill in gap by continuing to mandate the use of renewable energy.

State Policy Program: Whatever the feds ultimately do, states are taking action to ensure that the future is bright -- literally and metaphorically -- for alternative energy production in the United States. With more than half of states having enacted renewable portfolio standards we are well under way to achieving our environmental and economic goals, but much more needs to be done. States should continue to build on their track record of innovation in clean energy policy by continuing to enact and renew their renewable energy goals. Specifically, as this Dispatch has demonstrated, states should:

Enact RPS standards, and for those that have enacted them, to find ways to set higher goals that can be accomplished and are meaningful;
Provide financial support -- in the form of bonds, rebates, or other innovative financing mechanisms -- to accelerate the deployment of more renewable energy technologies;
Integrate renewable sources into an upgraded, “smart” grid, and;
Create good, sustainable green jobs that will enable those employees to develop, manufacture, deploy, and maintain the various elements of renewable sources and smart grid infrastructure.

The key is not only promoting renewable energy supplies, but also of creating actual incentives that spur their use. These incentives come in the form of mandating goals for renewable use, as was the case in Colorado, and placing financial incentives for clean energy investment. As more and more renewables are manufactured, installed and used, it is imperative that our electrical grid also undergoes a drastic reformation.

Resources
Environment America - America on the Move
Headwaters Economics - Clean Energy Leadership in the Rockies: Competitive Positioning in the Emerging Green Economy
Pew Research Center Publications - An Increase in GOP Doubt About Global Warming Deepens Partisan Divide
The Pew Charitable Trusts - The Clean Energy Economy: Repowering Jobs, Businesses and Investments Across America
Center for Social Inclusion - Solar Energy Generation at the Community Level: Briefing Paper Five of Black, Brown and Green

Unemployment Insurance Extension Filibuster Worsens Economic Pain

Altaf Rahamatulla — Thu, 08 Jul 2010 13:13:40 -0400

The country is still reeling from the effects of the downturn. Though the American Recovery and Reinvestment Act (ARRA) has undoubtedly benefited the economy, there are still 15 million Americans out of work.

Unfortunately, due to right-wing obstructionism in the US Senate, Congress was unable to extend unemployment insurance (UI) resulting in 1.7 million Americans losing their benefits on July 3. The Department of Labor released state-by-state breakdowns of Americans who lost UI earlier this month.

Follow this link to view a chart of the Estimated Number of Claimants Losing Unemployment Benefits by July 3, 2010 if Congress Fails to Continue Federal UI Programs.

If Congressional inaction continues, a total of 3.2 million workers will lose their umemployment benefits by the end of July. Furthermore, as the Center for American Progress notes, "[t]he lapse in congressional reauthorization forces 23 states and the District of Columbia to stop distributing extended benefits at a time when additional unemployment insurance benefits are needed most."

Not only are unemployment benefits critical for the long-term unemployed, but federal inaction on UI threatens economic recovery. Mark Zandi, chief economist at Moody's Economy.com and former adviser to Senator John McCain, finds that extending unemployment benefits provides a significant fiscal bang for the buck in fueling economic recovery by maintaining consumer spending in hard-hit communities. In fact, every $1 in federal spending on extending UI generates $1.61 in market activity.

As Zandi states, "[t]he odds that the economy will slip back into the recession are still well below even. But if Congress is unable to provide this help, those odds will rise and become uncomfortably high." Congress needs to move swiftly and boldly on enacting further job creation to boost the ailing economy. If you are a state lawmaker, please sign onto a letter calling on the President and Congress to enact a comprehensive jobs plan, including fiscal relief to states and local governments to foster economic growth and create and maintain jobs.

Resources
Center for American Progress - Today's Unemployment Crisis by the Numbers
House Ways and Means Committee - Estimated Number of Claimants Losing Unemployment Benefits by July 3, 2010if Congress Fails to Continue Federal UI Programs
The Huffington Post - Congress Should Quit Its Deficit Dithering Unless It Wants Another Recession
Mark Zandi - The Impact of the Recovery Act on Economic Growth
Progressive States Network - Saving Jobs: More Federal Action Needed on State Fiscal Relief

Wal-Mart Deal for Higher Wages in Chicago Highlights Need for Industry-Specific Wage Legislation

Tim Judson — Thu, 01 Jul 2010 11:42:31 -0400

For the first time in the nation, Wal-Mart has agreed to a higher wage standard at a new store to be built in Chicago, Illinois. The retail giant’s commitment was part of an agreement to assure City Council support for zoning approvals, on which the Council voted Wednesday. The deal also concludes a six-year fight over what will be only Wal-Mart’s second store in the Windy City. As we reported previously, Wal-Mart reached a stalemate with labor unions in 2006, after the City Council passed an industry-specific wage standard for big box retailers, which was later vetoed by Mayor Richard M. Daley.

Under the new agreement, Wal-Mart commits to a starting wage of $8.75, $0.50 per hour higher than the minimum wage for new employees. After one year of employment, Wal-Mart will raise workers’ wages by $0.60 to $9.35 per hour. Wal-Mart also agreed to pay prevailing wage, use union contractors to build the store and to provide $20 million to local non-profits over five years. The company claims the deal paves the way for it to move forward with plans to open two-dozen more stores in Chicago by 2015, although the agreement does not cover any other stores.

Legislation Needed to Lock-in Higher Wage Standards: Despite conventional assumptions about the economy, the Wal-Mart case shows that state and local governments still have good opportunities to raise wage and labor standards, particularly on an industry-specific basis. Still, this is a an agreement for only one store, rather than the city-wide policy embodied in the original ordinance approved by the City Council. Wal-Mart was able to negotiate its compromise by fragmenting the opposition with promises of temporary benefits to the building trades and non-profits and avoiding broader legislation. If Chicago enacted its 2006 wage ordinance, the local economy would have benefited from thousands of workers throughout the city’s big-box retail sector being lifted out of poverty and depending less on public services.

While the deal represents a first for Wal-Mart, it falls short of other actions cities and states are taking to set higher industry-specific wage and labor standards. For instance, in 2008 Los Angeles passed a law that sets a living wage standard at all hotels near the LAX airport; and in 2009, New York state passed a law requiring labor peace agreements for all hotels developed or financed by the state through its public benefit corporations. New York is also considering a bill that would set a prevailing wage standard for building service workers employed by public utilities.

A similar fight is looming over Wal-Mart’s plans to build its first store in New York City, where the City Council in December stood strong by rejecting another retail project because the developer would not agree to a living wage standard. According to City Council Speaker Christine Quinn, the question for elected officials is not about creating jobs or not creating jobs, but about what kind of jobs the city should be creating: “We don't want companies that have led the nation in law suits being brought against them by workers,” she said. “We don't want companies that have the largest class-action in history brought against them. We don't want companies where women are, over and over, paid less than men and not promoted.”

Resources
National Employment Law Project - The Road to Responsible Contracting
Good Jobs First - High Road or Low Road? Job Quality in the New Green Economy
Good Jobs First - Making the Connection: Transit-Oriented Jobs and Development
Economic Policy Institute - The Employment Impact of a Comprehensive Living Wage Law, Evidence from California

Paid Sick Days Legislation has Overwhelming Support, Polling Shows

Tim Judson — Thu, 24 Jun 2010 12:56:56 -0400

86% of the public favors legislation that would mandate seven paid sick days per year for all employers, according to study sponsored by the Public Welfare Fund in collaboration with the National Partnership of Women and Families (full results here). Even when the public is asked about mandating nine paid sick days per year, 71% still support the proposed legislation. The study found that paid sick days legislation enjoys deep public support across all demographics and political leanings, including large majorities of Republicans as well as Democrats.

In response to the statement, “Paid sick days is a basic worker right, just like being paid a decent wage,” not only did 75% of public agree, but on a scale of 1 to 10 signifying agreement, 43% rated the statement a 10 and 64% agreed strongly (rating it an 8 or higher).

The issue strongly colors how voters view elected officials, with 47% saying they would favor a candidate who supports paid sick days, while only 14% said they would not support that candidate.

Job Losses Suffered Due to Need for Sick Days Drives Opinion: Driving the poll numbers is the reality that too many workers have lost a job or been threatened with losing a job because they needed to take a sick day for themselves or to care for a family member. One out of every six people (16%) has lost their job for missing work due to illness, and one in four (25%) has been told they would either lose their job or be suspended or punished. And while 64% of workers are “eligible” for paid sick leave, the real picture is much more dire:

Less than half of the workforce (47%) can take a paid sick day to care for a sick child or family member, meaning most parents either have to risk their job to care for their children or send them to school sick.
Most workers (58%) whose employers offer only generic “paid time off” get a total of 10 days or less per year to cover vacation, personal, and sick leave.
55% of people without paid sick days have had to go to work sick, compared to 37% of workers who can take a paid sick day.
24% of those without paid sick days have had to send a sick child to school because they couldn't get the day off, while only 14% of those with paid sick days had to do so.

Public Does Not Believe Paid Sick Days Hurts Business Bottom Line: While paid sick days legislation has faced vigorous opposition from some in the business community, in most of the 23 states where it has been introduced, the public overwhelmingly rejects the typical arguments that paid sick days will harm jobs or individual businesses. The research indicates that their messages are not persuasive to voters:

54% of those polled find "very convincing" the argument that "Requiring paid sick days doesn't hurt employers' bottom line" because paid sick days increases worker productivity.
By contrast, only 26% of those polled found the opposition argument "very convincing" that "Given the economic downturn we are now in, businesses can't afford to add new benefits like paid sick leave."

In fact, while almost all of the arguments in favor of paid sick days were viewed by majorities as "very convincing," no arguments by opponents were considered "very convincing" and only four of seven opposing arguments were seen as even "somewhat convincing" by more than half of those surveyed.

Reinforcing the polling numbers is the reality that where paid sick days have actually been implemented, such as the City of San Francisco, even original opponents of the policy, are now applauding its success. In a recent Business Week article, the such as the Golden Gate Restaurant Association stated that paid sick days has been “the best public policy for the least cost" since the policy was enacted.

Resources
Public Welfare Fund - Paid Sick Days: Attitudes and Experiences

Workplace Standards for Domestic Workers: Breakthrough NY Legislation Approved

Tim Judson — Thu, 10 Jun 2010 16:59:00 -0400

On June 1, the New York Senate put the state in position to be first in the nation to enact a Domestic Workers' Rights law (S2311) by a vote of 33-28. The New York Assembly led the way in June 2009 when it passed its own version of the bill (A1470). This groundbreaking legislation will extend core labor rights, from fair labor standards to paid sick days, to creating a framework for collective bargaining, to domestic workers. This will include those employed to work in a private home to perform housekeeping and/or to care for children, the infirm, or the elderly.

The two versions of the law must be reconciled, as the Senate bill goes much farther in extending basic labor standards, but Gov. David Paterson pledged last year that he would sign the bill. A campaign to pass similar domestic workers legislation is also active in California.

Justice Seventy Years Delayed: Seventy years after passage of the Fair Labor Standards Act (FLSA), domestic workers like agricultural workers are still denied many basic labor protections under federal law such as overtime pay and the ability to join a union. That omission was an extension of the country's entrenched history of discrimination, particularly in the pre-Civil Rights Act era: both farm and domestic workforces had long been dominated by African Americans.

In the 21^st Century, domestic workers remain one of the most exploited segments of the workforce, being comprised almost entirely of immigrant women: according to Domestic Workers' United, 99% are foreign born, 95% are people of color, and 93% are women. Until 1974, when the FLSA was amended to extend minimum wage coverage to them, domestic workers were not protected by any major federal labor law.

As California showed by passing the Agricultural Labor Relations Act in 1975, states can play a leading role in providing basic labor standards for workers abandoned by federal labor law. Just as the United Farm Workers elevated the plight of farmworkers to national attention beginning in the 1960s - and which resulted in passage of the California law - groups such as Domestic Workers United and the National Domestic Workers Alliance have just begun in the last decade to bring similar attention to promoting state and federal reforms on behalf of domestic workers.

Precedent-Setting Standards: Because of the challenging employer-employee relationship involved in domestic employment, the Senate law seeks to create a standard contract for all domestic workers specifying benefits that they are owed. The New York Assembly version has more limited but important benefits - guaranteeing a minimum wage law, prohibiting mandatory overtime, overtime pay, guaranteeing one day of rest per week, and directing the state's Labor Department to investigate a framework for providing employer-provided healthcare and collective bargaining - while the Senate version also provides for:

Paid time off, including six paid holidays, five vacation days, and seven paid sick days (with provision for holiday pay and increased overtime rate on holidays)
Two-weeks, written notice of termination, with violations subject to back-pay
Criminal penalties for violations, including misdemeanor penalties of up to $20,000 and one year in prison for first violations, and similar felony penalties for subsequent offenses
Enforcement either through civil action or prosecution by the Labor Department or Attorney General, with willful violations subject to fines equal to 25% of unpaid wages

A National Breakthrough on Paid Sick Days: Should the paid time off provisions of the Senate bill be included in the final version of the law, New York will be the first state in the country to establish paid time off as a basic labor standard, not just for domestic workers, but for any private-sector employees -- advancing basic labor standards that are common throughout the rest of the world but sorely lacking in the United States. The new law is especially significant for the movement to enact paid sick leave legislation, since it would also be the first time an entire industrial sector has acquired the right to take paid sick time off from work. The Domestic Workers' Rights bill has not met with organized opposition thus far, primarily because of the informal nature of domestic employment.

Maine Voters Reject Tax Reform Initiative, but Approve Infrastructure Investment

Altaf Rahamatulla — Thu, 10 Jun 2010 16:58:23 -0400

This past Tuesday, Maine votersconsidered legislation which would have reformed the state's tax structure and bond measures that will bolster infrastructure investment.By a large margin, Mainers rejected a law passed last June, LD1495, to lower the top income tax rate from 8.5 percent to 6.5 percent for state residents earning less than $250,000 annually by broadening the sales tax to include different services and shifting tax burden to nonresidents by increasing the meals and lodging tax from 7 to 8.5 percent.

Supporters of the reform initiative, most notably, Maine AFL-CIO, some regional Chambers of Commerce, the Maine Council of Churches, and the MaineCenter for Economic Policy Institute (MECEP), contended that itrepresented the most substantial reform of the state's tax code in almost four decades. Overall, MECEP found that the "modestly...progressive" package would have provided "direct help for families struggling to survive in this troubling economic climate, and it is money that will stay in the local and state economies and buoy Maine small businesses." Opponents, including conservative groups, the state's Realty Association, and businesses tied to the tourism industry,who argued against shifting some of the state's tax burden to tourists and expanding the sales tax base to include different categories of services, gatheredthe necessary signatures to place the issue up for referendum as Question 1.

While the legislation would have reduced the income tax burden for 95 percent of Maine families and made it easier to apply and receive property tax relief through the state's circuit breaker program, advocates believe the campaign to support reform faltered due to the complexity of the message. While many voters readily saw expanding the sales tax base to services as a tax increase, they were skeptical that the state would deliver on lowering the income tax burden. Sen. Joe Perry, one of the authors of the legislation, reflected on the results, "I never thought I'd seethe public vote to raise their own taxes."

The ballot defeat additionallyindicates that while the current sales tax in most states is outdated and designed for an industrial economy in which most consumer spending went to buying goods, expanding the sales tax to services is still a challenging message to articulate to voters.

Although Mainers rejected changes to the state's tax structure, voters made clear that they support spending for long-term investments to spur economic development by approving bond measures for "$26.5 million for an offshore wind energy demonstration site, related manufacturing and campus energy conservation; $47.8 million for highways, railroads and marine facilities; and $10.25 million for clean water projects."