The California Institute

CONTENTS OF THIS ISSUE:
 Congress In Recess
 Delegation Circulating Criminal Alien Incarceration Funding Letter
 Bono & Lee Win; 13 of 55 Women in House are Californians
 Senate Approves House Child Support Enforcement Measure
 Forecast Predicts At Least 3 More Years of California Prosperity
 State Implements Welfare-to-Work Grant Program
 AEA Report Finds Decline in High Tech Graduates From ’85-’97
 January Exports Mixed, Imports Up Through California Customs
 Aerospace Foreign Trade Set Record in 1997

Congress In Recess . . .
     Congress will return from its two-week spring recess the week of April 20th – 24th. The Senate plans to reconvene on Monday, April 20th; the House of Representatives is scheduled to return to Washington for legislative business on Tuesday, April 21st.  There are approximately 60 legislative days scheduled until Congress is scheduled to adjourn for the year in October.

Delegation Circulating Criminal Alien Incarceration Funding Letter
     Reps. David Dreier (San Dimas), Gary Condit (Ceres), Jerry Lewis (Redlands), and Lucille Roybal- Allard (Los Angeles) are seeking signatures from other members of the California Congressional delegation on a letter to Rep. Hal Rogers (KY), Chair of the House Appropriations Subcommittee on Commerce, Justice, State, the Judiciary and Related Agencies. The letter urges Chairman Rogers to fund the State Criminal Alien Assistance Program (SCAAP) at its full authorization level of $650 million and his assistance in ensuring the Department of Justice disburses SCAAP funds in a timely manner.  According to the letter, states had to wait 18 months to receive all of the FY95 SCAAP appropriations and the FY97 disbursement is expected to be delayed 21 months from the date of appropriation.
     As a result of a June 25, 1997 letter from the California delegation signed by all 52 members, the House Commerce, Justice, State Appropriations bill requested $600 million for FY98, although the Senate appropriations contained only the $500 million.  The final figure agreed to was $585 million.  The delegation’s letter says, “the California Department of Finance estimates that the incarceration of undocumented criminal aliens will cost the state $471 million in the coming fiscal year, $184 million more than the state expects to receive in FY98 SCAAP funds.”
     Those members wishing to sign the letter should contact Brian Faughan in Rep. Dreier’s office, 225-2305; Mike Dayton in Rep. Condit’s office, 225-6131.

Bono & Lee Win; 13 of 55 Women in House are Californians
     On Tuesday, voters in the 44th and 9th congressional districts elected Mary Bono and State Senator Barbara Lee, respectively, to fill seats vacated earlier this year by the late Rep. Sonny Bono and retired Rep. Ronald Dellums.  Lee and Bono’s election increases the total number of women serving in the House to 55, and the total number of women serving in Congress to 62.  Nearly one quarter (13) of those 55 are Californians.  After Tuesday’s elections, the California congressional delegation includes 23 Republicans and 29 Democrats – the same ratio as at the start of the 105th Congress.
     In the 44th district, Mary Bono, a Republican, won 64.1% of the vote, with voter turnout at 29%.  The second-largest vote-getter was Ralph Waite, a Democrat, with 28.7% of the vote. Bono will succeed her husband, Sonny, who died in a skiing accident on January 5th.  Mary Bono graduated from the University of Southern California in 1984 with a B.F.A., and currently has two children and manages the family’s restaurant.  In her campaign, she pledged to continue many of her late husband’s endeavors, including restoration of the Salton Sea..
     State Senator Barbara Lee (Oakland), a Democrat, won 66.8% of the vote, with voter turnout at 15%.  Greg Harper, also a Democrat, took 16.2% of the vote, and Claiborne Sanders, a Republican, got 12.2%.  Senator Lee will replace her mentor and former boss, Rep. Dellums, who retired from Congress in February.  Barbara Lee received her B.A. from Mills College in 1973 and a master’s of social work (M.S.W.) from the University of California at Berkeley in 1975.  Lee is married to Michael Milben and has two children.  She was elected to the California State Assembly in 1991 and served in the Assembly until she was elected to the State Senate in 1997.
     Both women will serve out their predecessor’s remaining term, but will face re-election this fall.  A special election to fill the 9th Senate District seat vacated by Senator Lee will be determined by Governor Wilson in the near future.  Depending on when Lee resigns her Senate seat, the special election to fill her seat could be designated to coincide with the state’s scheduled November general election.

Senate Approves House Child Support Enforcement Measure
     Before Congress adjourned for the April Recess, the Senate approved H.R. 3130, the Child     Support Performance and Incentive Act of 1998.  Last month, the House approved the measure, by a 414-1 vote, that would provide for an alternative penalty procedure for states that had failed to establish a statewide, computerized system to track child-support payments.  Senator Feinstein had also introduced legislation to reduce the penalties faced by states.  At least 16 states, including California, missed the extended October 1997 deadline to have a system in place, and face penalties that cover 90% of federal funds to administer the system and up to 100% of the state’s welfare block grant.
     H.R. 3130 would provide lower penalties for non-complying states, if the state had adopted and the Secretary of Health and Human Services approved of a corrective or alternative plan that meets specified requirements.  Under the penalty schedule in the bill, a state would lose 4% of its funds in FY98, increase to 8% for the second year, 16% for the third, and 30% for the fourth and every year thereafter.  The bill, among other things, also includes incentives for states with high-performing and cost-effective systems, would deny entrance into the U.S. if the person is in violation of a court order to pay child support in excess of $5,000, and rebate a portion of a state’s penalty if compliance is achieved within two years.
    Last September, forty-six members of the California congressional delegation, including both Senators, sent a letter to House Ways and Means’ Subcommittee on Human Resources Chairman E. Clay Shaw Jr. (FL), expressing their collective concern over the severity of the welfare reform law’s financial penalties for failure to establish a statewide system.  About 2.4 million California families receive child-support payments; under existing law the state could lose $3.7 billion this year alone in federal funds.  Now that the Senate has approved H.R. 3130, the House may request a conference on the Senate’s changes to the bill or accept the changes and send the measure to the President.

 Forecast Predicts At Least 3 More Years of California Prosperity
     California can expect 1.2 million more jobs by 2000 says a recent press release by the UCLA’s Anderson Graduate School for Business’ on its updated state and national forecasts.  Although the Asian financial troubles will continue to impact the state’s export sector and the El Niño storms may continue to cause wide-spread property damage, the Anderson forecast says the state can expect continued short-term growth.  “It is evidence of the economy’s resilience that the combined blows of the Asia economic crisis and El Niño have thus far failed to produce visible damage to major economic indicators.  One must look at sector data to find any impact, and even that is far from disastrous.”
     Employment figures are also highlighted by the UCLA Anderson report.  The state’s unemployment rate is expected to continue to fall, from 6.6% in 1997. to 5.8% in 1998, and down to 5.3% in 2000.  The report calls for the U.S. unemployment will dip to 4.9% in 1998, but then rise to 5.5% in 1999.  Overall, economic expansion is called for by the forecast for the rest of the year, for 1998, a 3.2% growth rate of real GDP is predicted.
     For a copy of the complete forecast, call Gayane Keshishyan at 310/206-7707 or visit the UCLA Anderson School’s web site at <http//:www.anderson.ucla.edu/research/forecast/index.htm> for other forecasts.

State Implements Welfare-to-Work Grant Program
     Recently, the Legislature approved and Governor Wilson signed into law legislation to carry out the federal Welfare-to-Work Grant program..  The federal program was created last year as part of the Balanced Budget deal to help states move the hardest to employ welfare recipients into jobs.  A “hard-to-employ” person is someone who has been on welfare for 30 or more months, and lacks education, has a substance abuse problem, or a poor employment history.
     To implement the federal program, states had to match 50% of the federal dollars and then develop an allocation formula, within federal guidelines, to send 85% of the funds to local Private Industry Councils (PICs).  The remaining 15% of the funds can be used at the state’s discretion.
     California is scheduled to receive approximately $363 million for the 1997-98 and 1998-99 fiscal years under the federal program.  The state legislation appropriated $161.8 million for the current fiscal year and created annual reporting requirements.  According to the Governor’s Report (April, 1998 ed.), under the state law the state Employment Development Department (EDD) will administer the distribution of funds to local PICs and ensure they meet all reporting requirements.

AEA Report Finds Decline in Technology Graduates From ’85-’97
     In a report released on Thursday, April 9, the American Electronics Association (AEA) found that the number of B.S. engineering graduates in the U.S. fell 16% from 1985 to 1997.  The report also found that computer science and math degrees dropped 29% from 1985 to 1995.
     The AEA report is being unveiled during a time when Congress is considering raising the cap on skilled worker visas — visas for workers from other countries who can help the burgeoning demand for engineers and computer scientists — beyond the current 65,000 level set for this calendar year.  Industry sources estimate that that level will be reached before the end of May.
     The report notes that many of the foreign nationals needing visas already are studying at U.S. colleges and universities. For example, 48% of the 1997 Ph.D.s graduating in technical fields, such as computer engineering, were awarded to non-U.S. citizens.
     In 1996, the U.S. high tech industry swelled to 4.3 million employees, with almost 300,000 added since 1990, despite a recession early in the period.  The U.S. Bureau of Labor Statistics has estimated that computer and office equipment will be the fastest-growing industry in the nation between 1996 and 2006, with an annual growth rate of nearly 15%, and that software and data processing services will grow at 9.3% annually. Demand for computer engineers, systems analysts and computer scientists is expected to double by 2006.
     Just as Congress was adjourning for their current spring recess, the Senate Judiciary Committee adopted S. 1723, by a vote of 12-6, which raises the cap on the number of H-1B visas that can be issued for the admission of skilled immigrant workers from 65,000 to 95,000.  The bill also sets the length of the visas at six years, and will allow unused visas from other categories to be shifted to the H-1B program.  The bill responds to the plight of high technology companies, many California-based, that argue they have thousands of unfilled jobs available because they cannot find trained employees in the United States.  (For further information, see Bulletin, Volume 5, Number 12 — 4/2/98.)

January Exports Mixed, Imports Up Through California Customs
     January saw declines in export activity through two of California’s customs districts — a 3.4% decline for Los Angeles and a 3.3% decline in San Francisco — yet exports shipped through San Diego’s customs traffic was up by 11.3% over the level one year before.  At the same time, import activity for January moved forward strongly, with the Los Angeles district up 7.2%, the San Francisco district up 6.5%, and the San Diego district ahead a whopping 23%.  Jack Kyser of the Los Angeles Economic Development Corporation commented that “there is on-going debate about the impact of the Asian crisis on the California and U.S. economies, but it seems to be unfolding in what could be ‘slow motion’.”

Aerospace Foreign Trade Set Record in 1997
     Both exports and imports of aerospace products were up sharply in 1997, according to data released by the Aerospace Industries Association’s Research Center.  Exports rose from $40 billion in 1996 to $50 billion in 1997, according to the center, and imports climbed from $13.5 billion to $18 billion.  The majority of the export growth came in commercial transport aircraft, which grew 54% to $21 billion.  Parts exports rose $3 billion, while military aerospace exports declined $0.5 billion to $10 billion.  The majority of aerospace imports came in parts and turbine engines, which rose to $13.7 billion in 1997.

Click here to return to the California Institute home page.  Or click here to send us e-mail.