CONTENTS OF THIS ISSUE:

United Californians Score Victory In FEMA Public Rule Battle

Congress Sends H-1B Legislation to the President

New CR Carries Funding Through October 14

Crime Bill Would Restrict Internet Wine Sales

House Passes Ryan White AIDS Bill; Retains Provision to Protect S.F.

HHS to Publish Regulation to Close Medicaid Loophole

California Leads as Nation’s Uninsured Ranks Decline

California Ranks Low in Quality of Care to Medicare Beneficiaries

Californians Weigh In on Electricity Supply Issues

California Leads Nation in Number of Foreign-Born

Reminder: Friday October 6 Briefing on U.S. Voting Demographics

State’s Economy Climbed to 6th Largest in World in 1999

Energy and Water Conference Report Passes House and Senate; California Projects Breakout Available on Institute Web Site

United Californians Score Victory In FEMA Public Rule Battle

Through the efforts of the California congressional delegation, the Governor, and public entity representatives, Congress and the Administration have both backed off a plan to force local public agencies to carry disaster insurance to cover earthquake risks. The House, on Tuesday, October 3, approved the Disaster Mitigation Act (H.R. 707/S.1691) conference report after eliminating language that would have required the Federal Emergency Management Agency (FEMA) to move ahead with plans to promulgate a rule requiring the insurance. The Senate had included a provision in its version of the bill that would have given the status of law to FEMA’s proposed rule.

Also on Tuesday, FEMA announced that it was shelving the proposed rule that would have required disaster insurance. In its announcement, FEMA acknowledged that it still needed to gather more information on the "feasibility of encouraging new or expanded property insurance coverage." Therefore, it stated that it will study insurance coverage for public buildings. The delegation and California public interests have argued for over a year that earthquake insurance for public buildings is not available in California, and, even if available, would be prohibitively expensive, and that further study of the issue is needed before a rule is promulgated.

All 52 House members of the Delegation, both Senators Dianne Feinstein and Barbara Boxer, and Governor Gray Davis, the U.C., CSU and California Community College systems, various representatives of the state’s K-12 education system and public hospitals, as well as numerous local governments and government groups wrote letters over the last eighteen months urging FEMA to hold off on the rule and opposing the Senate language that would have forced it to move ahead with plans to promulgate a rule requiring disaster insurance. For further information, see, Bulletin, Vol. 7, Nos. 5 (2/10/00), 10 (3/23/00), 13 (4/13/00), 14 (4/20/00), 24 (7/20/00), 27 (8/27/00), and 29 (9/21/00).

Details of the FEMA announcement may be obtained through the FEMA website at: http://www.fema.gov/r-n-r/proinsur.htm .

Congress Sends H-1B Legislation to the President

After two weeks of debate, the Senate, on Tuesday, October 3, passed S. 2045 increasing the number of H-1B visas available for skilled foreign workers. The vote was an overwhelming 96-1. Later that day, the House took up the bill and passed it by voice vote, clearing it for the President’s signature.

The bill ups the number of H-1B visas from the current 115,000 to 195,000, annually for fiscal years 2001 through 2003. The current cap was reached in March of this year, and U.S. companies, particularly in the information technology industry, have stressed that additional visas are needed to fill job vacancies in the industry. The bill also exempts from the 195,000 cap non-U.S. workers employed at higher education institutions and research facilities. Also, current H-1B holders, whose adjustment to permanent resident status has been delayed because of administrative backlogs, may get extensions of their visas, in one year increments, until their adjustment of status has been decided.

The bill also contains several provisions to provide education and training opportunities for U.S. workers to prepare them for jobs in high technology fields. However, the bill did not increase the current $500 H-1B fee to pay for these programs. Some members have indicated they may try to include an increase in the fee to $1,000 in the Commerce, Justice, State appropriations bill, which funds the Immigration and Naturalization Service. On Tuesday, Rep. David Dreier (San Dimas) introduced H.R. 5362 to increase the fee to $1,000. He and Rep. Zoe Lofgren (San Jose) were the lead sponsors of the House legislation to increase the caps.

Senator Dianne Feinstein was successful in including an amendment to the legislation to reduce the naturalization and immigrant application backlog at INS. Those provisions require INS to improve its operations so that H-1B and other non-immigrant visas are processed within 30 days, and naturalization and immigrant visas are processed within 6 months. INS would also be required to report to Congress on its progress in reducing the backlog. According to Senator Feinstein, what used to be a six-month application process has now become a "3-to-4 year ordeal."

New CR Carries Funding Through October 14

On Thursday, October 5, the Senate approved H.J.Res 110, a continuing resolution to maintain funding for the federal government through midnight on Saturday, October 14. Until today, the government had been running under a 5-day extension passed prior to the September 30 end of the FY 2000 fiscal year. While 11 of the 13 appropriations bills for FY 2001 are still to be enacted, negotiations and forward motion are under way on many of them.

Crime Bill Would Restrict Internet Wine Sales

The conference agreement on a crime bill (H.R. 3244), scheduled for consideration by the House and possibly the Senate on Friday, October 6, contains a provision which would hamper the ability of winemakers and other independent producers of alcoholic beverages to sell products over the internet.

Many states restrict the shipment of alcohol across their borders, a boon to major wholesalers which can then charge higher prices due to the lack of competition from independent wineries. As currently drafted, the provision in the bill would allow state attorneys general to sue in federal court to enforce state laws banning internet alcohol sales.

House Passes Ryan White AIDS Bill; Retains Provision to Protect S.F.

On Thursday, October 5, the House passed S. 2311, the Ryan White CARE Act, by a vote of 411-0. The bill reauthorizes the bulk of the federal governments programs for AIDS prevention and treatment. S. 2311 retains language that will prevent San Francisco from substantial cuts in its portion of the funding. The formula used to distribute the money to the states will now take into account the number of HIV cases in the state, in addition to the number of AIDS cases, as is now the case. Initially, changes in the formula could have cut San Francisco’s funding by as much as $40 million over the five-year reauthorization period. Although San Francisco’s funds will still be reduced under the bill, the reduction is now expected to be only $7.5 million over five years.

The Senate must still act on the compromise bill before it is cleared for the President.

HHS to Publish Regulation to Close Medicaid Loophole

On Thursday, October 5, the U.S. Department of Health and Human Services (HHS) moved to close a loophole in the federal Medicaid program which had allowed 20 states to game the system and extract an additional $2 billion to $2.5 billion per year. California was not one of the states which had taken advantage of the loophole, but California officials had expressed concern that HHS language to repair the problem might negatively impact the state. California leaders, including Senator Dianne Feinstein and Governor Gray Davis, had weighed in with HHS’s Health Care Financing Administration urging caution in regulatory drafting.

HHS Secretary Donna Shalala announced on Thursday a proposed regulation which will be published in the Federal Register and which will be open for a 30-day comment period. The effect on California of the proposed regulations has yet to be determined.If approved, the rule would phase in over five years, and would make no funding shifts in FY 2001. It would change Medicaid’s "upper payment limit" rules to prevent states from averaging payments across public and private facilities, but states still could pay as much as 150 percent of the limit to non-state public hospitals, recognizing "their special situation as safety-net providers and their delivery of large volumes of uncompensated care."

For more information regarding the issue, see Bulletin, Vol. 7, No. 26 (8/10/2000). For Thursday’s HHS press release, see http://www.hhs.gov/news/press/2000pres/20001005b.html .

California Leads as Nation’s Uninsured Ranks Decline

Nationally, according to the U.S. Census Bureau there was a decline in the number of people without health insurance in 1999, the first decline since 1987. The percentage of the population without health insurance declined from 16.3% in 1998 to 15.5% in 1999. In a comparison of 2-year moving averages, 1997-1998 and 1998-1999, the Census Bureau reports that California was one of 15 states in which the proportion of people without coverage fell.

Similar to the general population, the percentage of children without health insurance also declined significantly from 15.4% in 1998 to 13.9% in 1999. Specifically among poor children the percentage decreased from 25.2% in 1998 to 23.3% in 1999. While acknowledging an increase in both government health insurance coverage and private health insurance coverage for children, the Census Bureau indicates the State Children’s Health Insurance Program (SCHIP) likely contributed substantially to the increase in government coverage.

The Census Bureau report can be viewed in its entirety at its website: http://www.census.gov/hhes/www/hlthins.html .

California Ranks Low in Quality of Care to Medicare Beneficiaries

In a recent U.S. Health Care Financing Administration (HCFA) study published in the October 4 issue of the Journal of the American Medical Association (JAMA), California ranked 41st among the 50 states, Puerto Rico and Washington, D.C. in quality of care provided to medicare beneficiaries. This study entitled Quality of Medical Care Delivered to Medicare Beneficiaries, the first of its kind, provides a general description of the quality of care in Fee For Service Medicare. The study, which is on-going, used 24 process-of-care measures related to primary prevention, secondary prevention or treatment of six medical conditions including acute myocardial infarction, breast cancer, diabetes mellitus, heart failure, pneumonia and stroke.

Although the study does rank the states based on the quality of care indicators, HCFA stressed that the differences in average performance among states are modest compared with the overall need for improvement and that there is "substantial opportunity to improve care delivered to medicare beneficiaries." To obtain a copy of the study or to view the article please visit the JAMA website: http://jama.ama-assn.org/ .

Californians Weigh In on Electricity Supply Issues

California Members of Congress continued to focus this week on the volatility in the state’s electricity market. On Monday, October 2, all 24 California Republican Members of Congress wrote to President Clinton questioning the Administration’s decision not to boost power output at the Glen Canyon Dam during this summer’s electricity supply shortage. The dam, located on the Colorado river, supplies power to California electric utility customers. The letter notes that federal law directs the Secretary of the Interior to study the impact on the Grand Canyon of Glen Canyon Dam flows, but that direction may be deviated from in the event of a power system operation emergency." The letter states that, "[i]n response to a Stage III electricity emergency on September 18, Glen Canyon’s hydropower generation facilities were increased from 330 megawatts per hour to 655 megawatts per hour," adding, "[t]his is the first time during the California energy crisis that generation was increased, even though the Secretary has at his discretion the ability to waive the study in cases of power emergencies." The letter asks why generation was not increased in June, July and August, instead of waiting until September 18.

In Sacramento last week, Governor Gray Davis signed a variety of bills related to electricity supply and costs, including S.B. 1388 by Sen. Steve Peace (San Diego), to expedite the permitting of new power plants, and a variety of bills related to energy efficiency, conservation and renewable energy sources. Earlier in the month, the Governor signed bills to stabilize electric rates and accelerate siting of new power facilities in California.

The Governor did veto AB 1156, which would have committed $150 million to pay off uncollected charges due to the rate cap in San Diego. In a press release, Governor Davis reiterated his call on FERC to reduce price and bid caps on wholesale power sold in California, stating "There is no justification fo delay when the wholesale markets under FERC regulation – not state regulation – are so clearly broken."

On Thursday, October 5, the co-chairs of the Northeast-Midwest Congressional Coalition, Reps. Bob Franks (NJ) and Marty Meehan (MA), asked the General Accounting Office to "audit the Bonneville Power Administration’s profiteering sales into the tight California electricity market." The northeastern Representatives noted that while the Federal Energy Regulatory Commission, the California Public Utility Commission and the California Attorney General are investigating the practices of firms selling power in California, the BPA is not under the authority of any of them. Thus, they have asked GAO to audit the BPA’s recent practices. A statement from the Members notes that BPA is perhaps the largest exporter of power into California, and BPA estimates its profits from electricity sales this year will exceed $500 million. Rep. Brian Bilbray (San Diego) has proposed opening power from BPA and other federal sources to purchase by private utilities in his bill, H.R. 5113.

For more information on these issues, see Bulletin, Vol. 7, No. 28 (9/14/00) and 30 (9/28/00).

California Leads Nation in Number of Foreign-Born

According to a Census Brief, entitled Coming to America: A Profile of the Nation’s Foreign-Born, released on October 4 by the U.S. Census Bureau, California is one of six states with a foreign-born population of 1 million or more. California, according to data collected in the Current Population Survey in March 1997, has an estimated 8.1 million foreign born residents.

The cities of Los Angeles and San Francisco have approximately 4.8 million and 1.4 million foreign-born residents, respectively, and the Los Angeles are is the top metropolitan area for immigrants. California, with 25% of its population made up of foreign-born residents, greatly exceeds the national average, which is 10%. The percentage is 31% in the Los Angeles area.

The Census Brief also examines region of birth as a possible indicator of social and economic well being of foreign-born residents. Indicators such as labor-force participation, education, poverty, household income and government program participation are used to compare residents from different regions with each other as well as with U.S. born residents. Of the foreign-born population, one in two, or 13.1 million foreign-born residents, are from Latin American, while 6.8 million, more than one quarter, are from Asia. Profile of the Foreign-Born Population in the United States:1997 can be viewed at the Census Bureau website at http://www.census.gov/prod/www/abs/briefs.html .

Reminder: Friday October 6 Briefing on U.S. Voting Demographics

As mentioned in last week’s Bulletin, the Population Resource Center on Friday, October 6, will host a breakfast briefing entitled Demographics of Voting in America: Who Votes, Who Doesn’t and Why at 10:30 a.m. in Room 2168 of the Rayburn House Office Building (the Gold Room). The briefing will feature presentations by Curtis Gans of the Committee for the Study of the American Electorate, and Russ Freyman of Neglection 2000 Third Millennium, and will focus on voting trends and projections, and the challenges of engaging Generation X in Presidential and Congressional elections.

State’s Economy Climbed to 6th Largest in World in 1999

According to reports from California experts, the state has moved into sixth place among the world’s largest economies. Both the Anderson Forecast at UCLA and the California Department of Finance have estimated that California’s gross state product (GSP) for 1999 reached $1.21 trillion, which now exceeds the gross product of Italy, which had formerly occupied the sixth place slot.

Further, the Anderson Forecast reportedly predicts California’s GSP will rise to $1.35 trillion for calendar year 2000, which would bring the state’s economy close to overtaking fifth-ranking Great Britain, which had a 1999 GDP of $1.34 trillion. In 1999, the U.S. ranked first (at $8.35 trillion), Japan second ($4.08 trillion), Germany third ($2.08 trillion), and France fourth ($1.43 trillion). With continued above-average economic expansion in the state, and relatively slower growth in Europe, California could conceivably reach the number four slot in the near future.

Energy and Water Conference Report Passes House and Senate; California Projects Breakout Available on Institute Web Site

The Energy and Water Conference Report (H.R. 4733) was approved in the House by a vote of 301-118 on Thursday, September 28 and in the Senate by a vote of 57-37 on Monday, October 2. However, the measure now faces a promised veto by President Clinton. A detailed spreadsheet extracting appropriations for California projects from the Conference report can be viewed at: http://www.calinst.org/pubs/ew01con.htm .

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