SPECIAL ALERT On August 8, 2020, President Trump issued an executive order to give employees a "payroll holiday" in the form of a 6.2% tax deferral normally paid to Social Security, for September 1, 2020 to December 31, 2020. On August 28, the U.S. Department of Treasury and Internal Revenue Service (IRS) gave employers more guidance on this issue, but still left many questions unanswered. Who Is Eligible? The deferral only affects workers whose biweekly pay is less than $4000, pretax. The deferral is to be implemented on a pay period by pay period basis. For now, this is not a forgiveness of the tax owed. Although, President Trump has promised to forgive the tax if reelected, it would require an act of Congress to forgive liability altogether.   Do Employers Have to Implement the Tax Deferral? The IRS guidelines suggest that it is up to the employer – not the employee – to decide whether to implement the tax deferral. It is likely a voluntary decision by the employer, as the IRS guidance does not state that the deferral is mandatory.    If employers decide to go ahead and make any deferrals this year, those same amounts must be withheld and paid back starting on January 1, 2021, and ending on April 30, 2021. Again, the guidance issued does not indicate when or if when employers have to begin the deferral. What if an Employee Quits and Can’t Pay Back the Deferral? The guidance also provides that the employer must "withhold and pay" the deferred taxes next year and, "If necessary...make arrangements to otherwise collect the total Applicable Taxes from the employee." This implies that the employer is probably responsible to pay any deferred amount to the IRS in the event the employee fails to repay it next year. For example, this situation may arise if the employee is no longer employed by the same employer in 2021. Given that the IRS guidelines still leave many questions unanswered, employers should consult with their tax specialist regarding deferral. Read the IRS guidelines here >>

On Friday, August 28^th, at noon PDT, Governor Gavin Newsom provided an update on the state’s response to the COVID-19 pandemic. 

Newsom said COVID-19 will be with us for a long time, so we need to adapt.  The state has learned a lot about COVID-19 and how it spreads, he said.  In response, his Administration is adjusting its sector framework to keep California healthy and safe.

Today, Newsom unveiled the “Blueprint for a Safer Economy” which replaces the County Data Monitoring List for determining what business can and cannot open. 

This new framework provides a 4-tiered system for tracking virus transmission in counties: widespread (purple), substantial (red), moderate (orange), minimal (yellow).  Every county is now assigned to a color tier based on its rate of new cases and positivity to determine which sectors can operate.  See additional details below depicted on the chart:

Requirements to advance:

• 21 day mandatory wait time between moves
• Meet metrics for the next tier for 2 weeks
• Counties can only move 1 tier at a time
• Assessed weekly

The new framework, like the previous guidelines, is based on science and reflects lessons Newsom stated.  As the state moves away from its County Data Monitoring List and into this color-coded system for reopening, here's a look at the current situation statewide:

Secretary of the California Health and Human Services Dr. Mark Ghaly was also present at the briefing and offered additional details on the new framework.  Notably, schools can reopen for in-person learning once the county has been in the red, moderate tier for 14 days.  He also said Californians can learn where their county stands under California's new COVID-19 tier system here: https://covid19.ca.gov/safer-economy/.

Newsom also announced new PSAs are launching and previewed them.  He also publicized some partnerships with Facebook, Yelp, Opentable, Google where businesses can now list safety precautions.

Regarding the pandemic, Newsom addressed the latest COVID-19 numbers, including the hospitalization and intensive care unit (ICU) patient figures.  There are 4,205 (2.0 percent decrease) positive COVID-19 hospital patients.  Of those patients, 1,329 patients (1.5 percent decrease) are in the ICU.  The latest COVID-19 positivity rates are 6.0 percent over the last 14 days.

In closing, the Governor did mention the Legislature’s end-of-session deadline and specifically said an agreement on evictions was reached with policymakers.  He did not offer any additional details and only noted that he is waiting for the language to go into print.  

The California Department of Public Health (CDPH) has announced the most recent statistics on COVID-19.  There are now a total of 683,529 (+0.7 percent increase) confirmed positive cases and 12,550 (+1.2 percent) deaths in California.  As of August 22^nd, there have been 10,918,415 tests conducted in California and reported to the California Department of Public Health.  This represents an increase of 85,658 tests over the prior 24-hour reporting period.  More information regarding the most recent COVID-19 statistics can be found here. 

On August 26^th, Newsom announced that California has signed a groundbreaking contract with PerkinElmer, a diagnostics company.  The partnership will allow California to process up to an additional 150,000 COVID-19 diagnostic tests a day, with a contractual turnaround time of 24-48 hours.  The goal is to stand up a laboratory facility and begin processing tens of thousands of additional tests by November 1^st and run at full capacity by ­no later than March 1, 2021.  A copy of the Governor’s Office press release can be found here.

Additionally, on August 26^th, Newsom signed an executive order to assist elections officials as they prepare for the upcoming election amid the COVID-19 pandemic and wildfires across the state.  The text of the Governor’s executive order can be found here and a copy can be found here.

The https://www.covid19.ca.gov/ website is being updated continuously.  A complete list of the state’s ongoing COVID-19 response efforts can be found here.

Can I Conduct Lien Sales and Charge Late Fees During the Coronavirus Pandemic?

Joe Doherty posted on 8/25/2020 4:44:00 PM

Lien Sales & Late Fees During the Coronavirus Pandemic

As the coronavirus (Covid 19) has spread throughout the United States, several states and localities have enacted restrictions on foreclosures and evictions. Many of these orders that have been issued to date exclusively cover residential evictions and foreclosures. However, some states have expanded those restrictions to cover commercial or non-residential evictions and foreclosures as well. Some of the commercial / non-residential eviction or foreclosure moratoriums may prevent operators from conducting self storage liens sales, performing overlocks, or imposing late fees.

Although self storage lien sales are not evictions in the usual sense of that word, SSA urges all operators to exercise great caution if they operate in an area covered by a moratorium on commercial or non-residential evictions or foreclosures.

First, self storage lien sales are a form of non-judicial foreclosure. Therefore, an order that imposes a foreclosure moratorium may apply to self storage lien sales. Second, the overall intent of many government restrictions at this time is to keep people at home as much as possible. It arguably frustrates the intent of the orders if a landlord creates a situation that forces a tenant to leave home for a non-essential purpose. Third, the orders are often hastily drafted and vague and do not define the term “eviction”, “foreclosure”, or other key terms in the orders. The overall intent, coupled with the vague wording, indicates that the term “eviction” or “foreclosure” is meant to cover any unilateral action by an operator that terminates a rental agreement. This certainly covers lien sales, even if the primary purpose of a lien sale is to recover unpaid rents.

The sheer volume or orders, especially from local governments, makes it difficult to provide a comprehensive list of jurisdictions that have enacted eviction or foreclosure moratoriums. Additionally, in the interest of space, we did not include local orders that affect only residential evictions or lawsuits filed to evict a tenant.

We intend to update this document frequently to include new orders and previous orders we missed. Please email Daniel Bryant and Joe Doherty if you believe any orders are missing.

California 

• Governor issued an order, issuing a statewide moratorium on residential evictions. 
• Governor also issued an executive order and a subsequent extension that authorizes local governments to pause evictions for residential and commercial tenants. The protection is in effect through September 30, 2020.
• Pursuant to the Governor’s order, tenants are still obligated to pay rent, and landlords can still recover rent that is due. The order only applies to the imposition of limitations on evictions when the basis for the eviction is nonpayment of rent, or a foreclosure, arising out of a substantial decrease in household or business income (including, but not limited to, a substantial decrease in household income caused by layoffs or a reduction in the number of compensable hours of work, or a substantial decrease in business income caused by a reduction in opening hours or consumer  demand), or substantial out-of-pocket medical expenses; and the decrease in household or business income or the out-of-pocket medical expenses was caused by the COVID-19 pandemic, or by any local, state, or federal government response to COVID-19, and is documented.
• In other words, the statewide order limits local governments to protecting tenants that provide a COVID-19 related reason for non-payment. If the tenant does not provide such a reason, a California operator can likely proceed with the lien process against that tenant. However, operators should carefully review the local orders linked to below to determine the exact protections available to tenants in the jurisdictions where the operator does business.
• Commercial evictions and commercial and residential foreclosures are suspended only as set forth by local governments. Some of the local orders provide protections past the statewide date of September 30, 2020. A complete list of California orders can be found here.

Livermore, CA 

• The Director of Emergency Services issued an order stating that “no landlord or lessor shall endeavor to evict a commercial tenant for nonpayment of rent, limit their physical access to personal property or conduct lien sales, including but not limited to any such provisions under.... Business and Professions Code section 21700 et seq., if the tenant or lessee demonstrates that the inability to pay rent is due to, or arising out of, a substantial decrease in business income or substantial out of pocket medical expense, or extraordinary child care needs, any of which was caused by the COVID-19 pandemic, or by any local, state, or federal government response to COVID-19, and is documented in writing.”
• A landlord who knows that a tenant cannot pay some or all of the rent temporarily for the reasons set forth above shall not serve a notice pursuant to . . . Business and Professions Code section 21703 as applicable, . . . conduct a lien sale, or otherwise seek to evict or terminate a rental agreement for nonpayment of rent during the period of the local emergency and while this Order is in place.
• A landlord is presumed to know of a tenant’s inability to pay rent within the meaning of this Order if the tenant or mobile homeowner, within 30 days after the date that rent is due, notifies the landlord in writing of tenant’s inability to pay full rent because of a substantial decrease in business income, or out of pocket medical expenses caused by the COVID-19 pandemic, or extraordinary child care needs, or by any local, state, or federal government response to COVID-19, and provides documentation to support the claim. Any medical or financial information provided to the landlord shall be held in confidence and only used for evaluating the tenant’s claim.
• A landlord is also prohibited from retaliating against a tenant that qualifies for the protections set forth in this order during the term of the moratorium. For example, a landlord, and any of the landlord’s employees or agents, is prohibited from terminating utilities or blocking physical access to personal property to a qualified tenant protected by this moratorium.
• The order remains in effect until September 30.

City of Los Angeles, CA 

• The Los Angeles City Council passed an ordinance requiring self storage owners to defer rent if a tenant is unable to pay for a COVID-related reason and provides documentation to the owner no later than seven days after the rent is due.
• The deferral lasts until three months after the local emergency period.
• The ordinance prohibits late fees on deferred rent.
• The ordinance also requires that owners provide notice of the ordinance to their tenants.
• Owners in Los Angeles are strongly encouraged to consult with legal counsel before proceeding with lockouts or lien sales. 

Los Angeles County, CA 

• The Board of Supervisors ratified an Executive Order stating that no residential or commercial property owner shall evict a residential or commercial tenant for: (1) nonpayment of rent, late charges, or any other fees accrued if the Tenant demonstrates an inability to pay rent and/or related charges due to financial impacts related to COVID-19, the state of emergency regarding COVID-19, or following government-recommended COVID-19 precautions, and the Tenant has provided notice to the Landlord within seven (7) days after the date that rent was due, unless extenuating circumstances exist, that the Tenant is unable to pay; or (2) reasons amounting to a no-fault eviction under the County Code, unless necessary for health and safety reasons.
• The order defines “no-fault  eviction” as  any eviction for which the notice to terminate  tenancy  is not based on alleged fault  by  the  Tenant,  including but not  limited  to,  eviction  notices  served pursuant to Code of Civil Procedure section 1161 et seq. or County Code.
• The Board later amended the Executive Order to cover the unincorporated areas of L.A. County and the incorporated cities without a local eviction moratorium.
• The amended order prohibits a landlord from charging late fees on unpaid rent.
• The amended order also states that “a commercial tenant includes, but is not limited to, a tenant using a property as a storage facility for commercial purposes.”
• The order provides tenants with 12 months after the expiration of the order to repay their unpaid rent.
• The L.A. Count order, as amended, may affect lien sales and late fees, particularly as applied to business tenants. Consultation with your legal counsel is strongly advised before proceeding with any lien activity.

Ontario, CA

§  The City Council ordered that no landlord shall endeavor to evict a storage unit patron (including a lien sale), in accordance with the ordinance, if the storage unit patron demonstrates that the inability to pay rent or fees is due to COVID-19, the state of emergency regarding COVID-19, or following government recommended COVID-19 precautions. To take advantage of these protections, the patron must satisfy all of the following requirements: 

1.       Prior to April 7, the patron paid rent due to the storage unit operator pursuant to an agreement. 

2.       The patron notifies the storage unit operator in writing before the rent is due, or within a reasonable period of time afterwards not to exceed 7 days, that the patron needs to delay all or some payment of rent because of an inability to pay the full amount due to reasons related to COVID-19, including but not limited to the following: 

• ·         The patron was unavailable to work because the patron was sick with a suspected or confirmed case of COVID-19 or caring for a household or family member who was sick with a suspected or confirmed case of COVID-19;
• ·         The patron experienced a lay-off, loss of hours, or other income reduction resulting from COVID-19, the state of emergency, or related government response; orThe patron needed to miss work to care for a child whose school was closed in response to COVID-19. 

3.       The patron retains verifiable documentation, such as termination notices, payroll checks, pay stubs, bank statements, medical bills, or signed letters or statements from an employer or supervisor explaining the patron’s changed financial circumstances, to support the patron’s assertion of an inability to pay. This documentation may be provided to the storage unit operator no later than the time of payment of back-due rent. 

§  If a storage unit patron complies with the requirements above, a storage unit operator shall not do any of the following: 

1.       Prevent a storage unit patron from accessing their stored items during the normal hours of operation of the storage unit facility; or 

2.       Send to the storage unit patron a Notice of Lien Sale pursuant to Business and Professions Code, Division 8, Chapter 10, or any other applicable statute regulating storage unit operators. 

3.     Conduct a Lien Sale pursuant to Business and Professions Code, Division 8, Chapter 10, or any other applicable statute regulating storage unit operators. 

§  For purposes of this ordinance, “in writing” includes email or text communications to a landlord or the landlord’s representative with whom the tenant has previously corresponded by email or text. Any medical or financial information provided to the landlord shall be held in confidence, and only used for evaluating the tenant's claim. 

§  The patron is not relieved of liability for unpaid storage fees, which the operator may seek after expiration of the local emergency and the patron must pay within six months of the expiration of the local emergency. Six months after the end of the emergency if the rent or storage fees are unpaid, an operator may charge or collect a late fee for rent/fees that is delayed for the reasons stated in the ordinance; or an operator may seek rent or storage fees that is delayed for the reasons stated in the ordinance through the eviction or other appropriate legal process.

§  The order remains in effect until further notice.

Pasadena, CA

• City Council passed an ordinance stating that “no landlord shall endeavor to evict a commercial tenant for non-payment of rent if a commercial tenant is unable to pay rent due to financial impacts related to COVID-19.”
• “Tenant” means a person, partnership, corporation, family trust or other business entity entitled by a written or oral agreement to occupy a rental unit to the exclusion of others, and actually occupy said rental unit for residential or commercial purposes (including, but not limited to, a self-storage facility, as defined by Pasadena Municipal Code Section 17.80.020).
• The Pasadena Municipal Code defines self-storage as “a structure containing separate storage space that is designed to be leased or rented individually in an enclosed building. This use does not include outdoor storage or recreational vehicles, boats, personal watercraft, motorcycles, or trailers.”
• A landlord shall give written notice of the protections afforded by this ordinance to each tenant no later than 30 days after its effective date. In lieu of providing written notice to each tenant's rental unit, a landlord may conspicuously post and prominently display such notice in the common areas of the property during the pendency of this local emergency.
• A landlord knows of a tenant’s inability to pay rent if the tenant, within 30 days after the date that rent is due, notifies the landlord in writing of lost income and inability to pay full rent due to financial impacts related to COVID-19, and provides documentation to support the claim. Any medical or financial information provided to the landlord shall be held in confidence, and only used for evaluating the tenant's claim.
• The tenant must pay any unpaid rent within six months after the local state of emergency ends.
• The landlord cannot charge late fees, deny a tenant access to the premises, or move or convert the tenant’s possessions.

What are a Landlord's Obligations to its Tenants During the COVID-19 Pandemic? By Scott I. Zucker As we move into the fifth month of the pandemic there remain conflicting signs of our future. Infections are rising, deaths are mounting while research institutes and pharmaceutical companies race to find a cure through a vaccine. In the interim, we seek to find normalcy with working from home, creating virtual classrooms for our children, wearing masks while shopping, and enjoying outside-only dining at restaurants. For those invested and working in the self-storage sector of the industry, while we may have learned that our business was "essential" (at least under some definitions), the pandemic has left us with anxious tenants, un-visited facilities, increasing rent defaults and a new list of maintenance and safety protocols. COVID-19 has also left us with certain new and unique questions about the obligations of being a landlord. One of the first issues is how to handle late fees and the enforcement of the owner's lien due to a rent default. Significantly, with the imposition of multiple ambiguous and inconsistent statewide and municipal orders, the pandemic has led to either no late fees and no lien sales being imposed by operators for the last five months or the sporadic and cautious return of the owner's enforcement of its contractual and statutory rights in response to defaulting tenants.  Guidance on this issue has been difficult, since none of the laws that seek to protect struggling residential tenants or even small businesses truly intend to forgive a tenant's obligation to pay its rent or forestall a landlord from its right to be paid. But many hastily drafted executive orders, court orders and even state laws have resulted in confusing and incomplete directives as to the right that a self-storage operator may have when it comes to enforcing its contractual entitlement to late fees and, more importantly, its statutory self-help remedy of foreclosing on its lien over its tenant's stored goods. At this juncture, the only appropriate answer to the question of "Can I sell?" would be to thoroughly review and consider any statewide orders or laws that have been legislated as well as any orders or laws that may have been issued by local municipalities where the facility is located. As an interim measure, it is widely recommended that all lien notices be updated to include certain COVID-19 language to allow tenants to respond to a facility's default notice. The language might read something like: "If you are unable to pay your account in full because you were financially impacted by the COVID-19 Pandemic, please contact us to discuss your situation. Please note that in order to assist you, it will be necessary for you to provide us with medical confirmation if you or a family member had the virus or employment records if you became unemployed." The other issue that a self-storage landlord needs to consider is the risk of virus contact at the facility. Although the potential liability for asserting that a virus contact arose at a facility (as compared to a grocery store or even at home though another family member) is truly small, there is still a burden imposed on a self-storage operator, like all business owners, to ensure their property is, through ordinary care, as safe as possible. This is why operators are encouraged to develop cleaning protocols at their facilities where doors, handles, pin-pads and other surfaces are regularly cleaned and the operator creates an ongoing maintenance log to document these good faith, regular efforts at sanitation. Included in this ongoing documentation is the tracking and notice to employees and tenants of any recent visitors to the property that have tested as positive for the virus. Although there appears to be no law to require it, if that is the case and the facility is notified, it would be recommended that the facility post a notice acknowledging that the facility received notice that an infected person was on the premises and, since notification, the facility (and the areas where the person traveled on the property) have been sanitized for cleanliness. The decision to notify as compared to not notify may seem burdensome, but the benefit of making that disclosure (thereby permitting the tenant to make its own decision to enter) may ultimately create the difference between a successful or unsuccessful tenant injury claim.  Stay Safe and Happy Storing! Scott

On Wednesday, August 26^th, at noon PDT, Governor Gavin Newsom provided an update on the state’s response to wildfires and the COVID-19 pandemic. 

The Governor opened by announcing a new testing partnership with diagnostics company PerkinElmer.  This effort will allow California to process up to an additional 150,000 COVID-19 diagnostic tests a day, with a contractual turnaround time of 24-48 hours.  Notably, the average turnaround time now in California is between 5-7 days for each test.  The goal is to stand up a laboratory facility and begin processing tens of thousands of additional tests by November 1^st and run at full capacity by ­no later than March 1, 2021.

Newsom also said the partnership will help "drive down costs across the spectrum.”  The cost breakdown was cited as follows: for up to 40,000 tests: $47.99; for 100,00 tests: $37.78; for 150,000 tests: $30.78 per test.  Average costs of a test currently are between $150.00-$200.00.  “If you are fiscally conservative, you should be demanding the federal government do its part to bring down the cost of these diagnostic tests.  If this new partnership is successful, hopefully we can include other states in it,” he said.

In discussing contract protections, Newsom referenced a best price guarantee, claw back provisions; change in technology provisions; cure for COVID-19 opt-out; genomics and pooled upgrades; and a zero cost upgrade for flu package.  His Administration will make this contract public.

Newsom noted that as we approach flu season the demand for testing will likely increase.  Additionally he acknowledged that the efforts of the respective Health Committee chairs, Senator Richard Pan and Assemblymember Jim Wood, were integral to this parternship. 

Both Senator Pan and Assemblymember Wood both offered remarks at the press briefing. “We need to contain the pandemic, and in order to do that we need to have reliable testing.  We're taking the lead in establishing reliable testing for California.  This is essential so we can test people in a timely manner, get results in time to support contact tracing,” Senator Pan said.  Assemblymember Wood noted that having the capability to do 150,000 tests a day is a “game changer.”

The Governor’s office press release regarding the partnership with PerkinElmer can be found here.

Newsom addressed the latest COVID-19 numbers, including the hospitalization and intensive care unit (ICU) patient figures.  There are 4,365 (1.3 percent decrease) positive COVID-19 hospital patients.  Of those patients, 1,367 patients (1.5 percent decrease) are in the ICU.  The latest COVID-19 positivity rates are 6.1 percent over the last 14 days.

Newsom also stated that currently there are 34 counties on the state’s monitoring list. Amador, Glenn, Calaveras, Mono, Napa, Orange, Placer, Santa Cruz, San Diego, and Sierra fell off recently.  Tehama was added.  The list can be found here: https://covid19.ca.gov/roadmap-counties/.

On Friday, Newsom will provide an update on new sectoral reopening guidelines.

In closing, the Governor once again urged: Wear a mask, physically distance, wash your hands, and minimizing mixing.

During the Q&A portion of the briefing, Newsom was asked about the news regarding a positive COVID-19 test within the Senate.  In response, Newsom said he was tested for COVID-19 a few weeks back after visiting a prison and his test came back negative.  He said his family has been tested also.  However, he did not directly acknowledge the situation in the Senate.

Regarding the CDC’s new guidance not requiring tests for those who may have been exposed to COVID-19 – Newsom said, "I don't agree with the CDC guidance period, full stop, and it's not the policy in the state of California.  We will not be influenced by that change."

The California Department of Public Health (CDPH) has announced the most recent statistics on COVID-19.  There are now a total of 679,099 (+0.9 percent increase) confirmed positive cases and 12,407 (+1.2 percent) deaths in California.  As of August 22^nd, there have been 10,832,757 tests conducted in California and reported to the California Department of Public Health.  This represents an increase of 70,251 tests over the prior 24-hour reporting period.  More information regarding the most recent COVID-19 statistics can be found here. 

The https://www.covid19.ca.gov/ website is being updated continuously.  A complete list of the state’s ongoing COVID-19 response efforts can be found here.

Naomi Padron

Legislative Advocate

McHugh Koepke & Associates

1121 L Street, Suite 103

Sacramento, CA 95814

(916) 930-1993

www.mchughgr.com

On Monday, August 24^th, at noon PDT, Governor Gavin Newsom provided an update on the state’s response to wildfires and the COVID-19 pandemic. 

Newsom said while California battles historic wildfires, COVID-19 has not gone away.

Regarding the pandemic, Newsom addressed the latest COVID-19 numbers, including the hospitalization and intensive care unit (ICU) patient figures.  There are 4,467 (2.1 percent decrease) positive COVID-19 hospital patients.  Of those patients, 1,397 patients (3.1 percent decrease) are in the ICU.  Hospitalizations have decreased 20 percent over 14 days, continuing to trend in a very encouraging direction. ICUs have decreased 19 percent. The latest COVID-19 positivity rates are 6.5 percent over the last 14 days and 5.6 percent over the last 7 days.

Newsom also stated that currently there are 35 counties on the state’s monitoring list. Calaveras, Mono, Napa, Orange and Sierra fell off recently. The list can be found here: https://covid19.ca.gov/roadmap-counties/.

During the Q&A portion of the briefing, Newsom was asked about the guidance for reopening as more counties are removed from the monitoring list.  In response, Newsom reiterated that these guidelines will be released later this week.

As it relates to school reopenings, Newsom said the default should be in-person education as long as it is safe.  However, he also noted that locals will make the determination in the best interests.

Newsom was also asked about AB 5 and specifically Uber/Lyft.  On AB 5, Newsom seemed to indicate that he would sign Assemblymember Gonzalez’s AB 2257.  Specifically, he said it is “very likely" more sectors will get exempted "and I anticipate having the opportunity to sign that bill.”  Regarding Uber/Lyft specifically, Newsom stated, “we tried to bring the different perspectives on Uber/Lyft together last year and we fell short of finding an area of common ground.  The law went into effect, and the AG needs to enforce it.  But there was a reprieve, and there is a ballot initiative.”  He went on to say that the reason why he engaged in these conversations was because he believes there is an opportunity to find common ground – “We have to create conditions where innovation can flourish. We also have to create conditions where workers are protected. It's not either/or.  I firmly believe we can do both and I'm committed to that.  As we grow our economy, it must be an inclusive economy.”

Newsom said he has visited most of the shelters for wildfire evacuees and he is confident in their COVID-19 precautions.  He said before he could enter the shelters, his temperature was taken and he was asked a series of screening questions.  He also had to wear a mask and stay distanced from others.  Newsom acknowledged that the shelters' prevention efforts are not perfect, but he has been very impressed by what he is seeing.

In terms of a special session, Newsom said he is open to calling a special session, but only “if it is necessary, if it actually solves a problem.”

Regarding the legislative stimulus plan – Newsom said progress is being made on these efforts specifically in the eviction space.

The California Department of Public Health (CDPH) has announced the most recent statistics on COVID-19.  There are now a total of 63,669 (+1.0 percent increase) confirmed positive cases and 12,134 (+1.2 percent) deaths in California.  As of August 22^nd, there have been 10,541,031 tests conducted in California and reported to the California Department of Public Health.  This represents an increase of 111,456 tests over the prior 24-hour reporting period.  More information regarding the most recent COVID-19 statistics can be found here. 

The https://www.covid19.ca.gov/ website is being updated continuously.  A complete list of the state’s ongoing COVID-19 response efforts can be found here.

Naomi Padron

Legislative Advocate

McHugh Koepke & Associates

1121 L Street, Suite 103

Sacramento, CA 95814

(916) 930-1993

www.mchughgr.com

On Wednesday, August 19^th, at noon PDT, Governor Gavin Newsom provided an update on the state’s response to wildfires, the West Coast heat wave, and the COVID-19 pandemic. 

The Governor opened by acknowledging that the West Coast continues to experience a heat wave.  This has led to “many red flag warnings, including a significant number of lightning strikes - 10,849 lightning strikes in the last 72 hours,” he said.  Also, Newsom noted there is the prospect of world record temperatures in California.

Newsom also spoke about the active wildfires throughout the state, some sparked by the lightning strikes.  In total, there are 367 known fires burning statewide and 23 major/complexes burning.  As it relates to the 23 major fires, the Apple Fire is 95 percent contained; Lake Fire is 38 percent contained; Loyalton Fire is 35 percent contained; Holser Fire is 30 percent contained; and the Ranch Fire is 19 percent contained.  However, there are also several major fires that are not currently contained including CZU August Lightning Complex; LNU Lightning Complex; Carmel Fire; and the Jones Fire.  Yesterday, a statewide state of emergency was declared to help the California  avail itself of resources to combat those fires.  

Newsom said, “What has happened in the last 72 hours in this state has stretched our resources.” Fires, on top of the threat of rolling blackouts, while juggling a pandemic. Despite the budget shortfall, the state increased CalFire’s budget by $85.6 million for firefighting efforts. California has also requested 375 engines from outside the state to help with firefighting efforts.  Arizona and Nevada have already sent equipment. 

In terms of actions the state has taken to conserve energy – an emergency proclamation was issued to shift energy and an executive order was signed so energy users and utilities could temporarily use backup sources.  Additionally, the state worked with major consumers to reduce usage.  Finally, an investigation into what happened and implications for the future is underway.

Newsom did say that tonight will probably be the last that Californians have to limit electricity use to reduce the risk of service disruptions.  Temperatures are supposed to drop after today.  Californians should avoid using too much power between 2-9 pm in order to get through "the last challenging night," Newsom said.  Turn off unnecessary lights, close curtains, delay your dishwasher, etc.

Regarding the pandemic, Newsom addressed the latest COVID-19 numbers, including the hospitalization and intensive care unit (ICU) patient figures.  There are 5,061 (1.7 percent increase) positive COVID-19 hospital patients.  Of those patients, 1,606 patients (1.1 percent increase) are in the ICU.  Hospitalizations went down 14 percent  and ICU admissions similarly decreased 13 percent over the last 2 weeks, but that trend line is hitting plateau over last few days.  Latest COVID-19 positivity rates in California: 6.6 percent over the last 14 days and 6.3 percent over the last 7 days.

Newsom also stated that currently there are 40 counties on the state’s monitoring list. There were 42 on Monday— San Diego and Placer dropped off. It is expected that San Francisco will come off list as early as tomorrow. The list can be found here: https://covid19.ca.gov/roadmap-counties/.

During the Q&A portion of the briefing, Newsom was asked about a specific school in Sacramento reopening under the guise of a day care center to resume in person learning.  In response, he said, “You're going to see some different approaches, strategies, people testing boundaries of the state orders.  As is the case in most of these instances, I want to thank local health officers for enforcement in this space.”

On federal unemployment relief – Newsom said his Administration has been working with the federal government to draw down additional benefits.  “We want to be among the first cohorts of states to draw down that money.  From day one, we asserted an interest and processed it in formal applications with federal partners.”

In terms of reopening guidelines – Newsom said he is working with local health officers on new criteria as it relates to opening certain businesses.  The plan is to share those more formally this weekend with health officers and make them public next week.

Regarding mutual aid – firefighting resources are stretched in ways we haven't seen in years, Newsom said.  Local authorities determine what to give, and that's just part of the protocols and processes.

In terms of energy reliability, Newsom said, “We cannot allow this to be a permanent state of anxiety, so we're going to be more aggressive than ever in pushing efforts on storage capacity….The solution to addressing the ravages of climate change is not to make the climate change even more acute and more devasting, by continuing to drill, continuing to go back to the old way of business…”

The California Department of Public Health (CDPH) has announced the most recent statistics on COVID-19.  There are now a total of 632,667 (+0.7 percent increase) confirmed positive cases and 11,342 (+0.9 percent) deaths in California.  As of August 12^th, there have been 10,049,039 tests conducted in California and reported to the California Department of Public Health.  This represents an increase of 115,259 tests over the prior 24-hour reporting period.  More information regarding the most recent COVID-19 statistics can be found here. 

On August 18^th, Newsom declared a statewide emergency to help ensure the availability of vital resources to combat fires burning across the state, which have been exacerbated by the effects of the historic West Coast heat wave and sustained high winds.  The text of proclamation can be found here and a copy can be found here.  A copy of the Governor’s office press release can be found here.

Additionally, on August 17^th, with the West Coast heat wave projected to intensify over the coming days, Governor Gavin Newsom today signed an executive order to free up additional energy capacity.  The Governor also signed an emergency proclamation that temporarily allows some energy users and utilities to use backup energy sources to relieve pressure on the grid during peak times during the energy emergency and today sent a letter to CAISO, the CPUC and CEC demanding an investigation into the service disruptions that occurred over the weekend and the energy agencies’ failure to predict and mitigate them.  A copy of the Governor’s office press release can be found here.

The https://www.covid19.ca.gov/ website is being updated continuously.  A complete list of the state’s ongoing COVID-19 response efforts can be found here.

Naomi Padron

Legislative Advocate

McHugh Koepke & Associates

1121 L Street, Suite 103

Sacramento, CA 95814

(916) 930-1993

www.mchughgr.com

News Release August 18, 2020 For Immediate Release (916) 210-6000 agpressoffice@doj.ca.gov Social Networks Print Version Attorney General Becerra Issues Consumer Alert on Price Gouging Following State of Emergency Declaration Due to Wildfires and Extreme Weather SACRAMENTO – California Attorney General Xavier Becerra today issued a consumer alert following the Governor’s declaration of a state of emergency due to statewide fires that have been exacerbated by the effects of a historic heat wave and sustained high winds. Attorney General Becerra reminds all Californians that price gouging during a state of emergency is illegal under Penal Code Section 396. “As families throughout the state face devastating fires and extremely dangerous weather, they shouldn’t have to worry about whether they’re being illegally cheated out of fair prices for essential goods and services,” said Attorney General Becerra. “Our state’s price gouging law protects people impacted by an emergency from illegal price gouging on housing, gas, food, and other essential supplies. I encourage anyone who has been the victim of price gouging, or who has information regarding potential price gouging, to immediately file a complaint with our office online at oag.ca.gov/report, or to contact their local police department or sheriff’s office.” California law generally prohibits charging a price that exceeds, by more than 10 percent, the price of an item before a state or local declaration of emergency. This law applies to those who sell food, emergency supplies, medical supplies, building materials, and gasoline. The law also applies to repair or reconstruction services, emergency cleanup services, transportation, freight and storage services, hotel accommodations, and rental housing. Exceptions to this prohibition exist if, for example, the price of labor, goods, or materials has increased for the business. Violators of the price gouging statute are subject to criminal prosecution that can result in a one-year imprisonment in county jail and/or a fine of up to $10,000. Violators are also subject to civil enforcement actions including civil penalties of up to $2,500 per violation, injunctive relief, and mandatory restitution. The Attorney General and local district attorneys can enforce the statute. # # # You may view the full account of this posting, including possible attachments, in the News & Alerts section of our website at: https://oag.ca.gov/news/press-releases/attorney-general-becerra-issues-consumer-alert-price-gouging-following-state-14 You may view all News & Alerts on our website at: https://oag.ca.gov/news Please visit the remainder of the Attorney General's site at: https://oag.ca.gov/ Unsubscribe from this list

On Monday, August 17th, at noon PDT, Governor Gavin Newsom held a press briefing to provide an update on the state’s response to the West Coast heatwave and the COVID-19 pandemic. 

The Governor opened today by discussing the record-breaking temperatures in the West Coast in the last 70 years, hitting a record high of 130 degrees in Death Valley. Thus, the conditions have precipitated fires, fifteen in total active with four large fires including River Fire, Ranch Fire, Lake Fire, Apple Fire that are currently being contained and actively monitored. Further, mentioned the Fire Management Assistance Grant (FMAG) has been granted by the Federal Emergency Management Agency (FEMA) to help with resource and recovery efforts in real-time. 

In addition to fires, extreme temperatures have strained the state's energy supply, which has caused temporary energy interruptions this weekend. Newsom warned that the energy shortages will more than likely to continue throughout the next couple of days but will be working to mitigate the need to fill the storage. Today, he warned the state anticipates a need of 4,400 megawatts to meet the need of the state but is working to address the storage through various efforts. As Governor, Newsom took responsibility for the failure to predict and plan for these shortages, calling it unacceptable. As a result, Newsom says he signed an Emergency Proclamation that shifts energy consumption that focuses on shifting large energy users to back- up power during peak hours 3:00 p.m. – 10:00 p.m., second focuses on utilizing the shared power that has been stored for PSPS usage, and also working with ports around the state to reduce consumption from the energy grid while at the ships are at the port. Additional actions include working with major consumers such as Nest and Tesla to reduce usage. Further, he states that he is working to procure and bring online more energy from Los Angeles DWP, support from the State Water Board, specifically peaker power plants to create more energy and meet the needs of customers. 

Additionally, Newsom, said that he issued an investigation into the interrelationship between California Independent System Operator (CAISO), the California Public Utilities Commission (CPUC), the California Energy Commission (CEC) to understand what happened and its implications for the future. Newsom, commits to ensuring there be a demand response system and reliability that meets the expectations around climate change. Additionally, Newsom request public to help conserve energy, specifically pointing to the Flex Alerts. 

As he does regularly, Newsom addressed the latest COVID-19 numbers. In regard to the positivity rate, adding the backlog over a 7 day period, totals 6,469. The state is averaging 133,632 test a day. The percentage over the course of 14 day that have tested positive is 6.5%. Accordingly, Newsom said the positive rate is stabilizing and moving in the right direction. Hospitalizations have declined 21% over a 14 day period. Healthcare system capacity is at 7% percent, ICU hospitalization are down 16% in ICU hospitalization. Overall, positivity rates percentages of trending downward. A new monitoring county list was issued today that changed from 38 to 42 counties from holding stable. Counties added to the list include Amador County, Mendocino County, Inyo County, Calaveras County, and Sierra County. Santa Cruz was removed from the list.

Currently, there are 42 counties on the state’s monitoring list.   The list can be found here: https://covid19.ca.gov/roadmap-counties/.

During the Q&A, Newsom was asked about the head of the ISO pointed the finger at the PUC for the shortfall in recent news and if there was anything in particular he could share in regards to those remarks. In response, he references to his emergency proclamation and stated a shared responsibility instead of finger pointing and is working to address the issues.

Further, Newsom was asked about paid family leave and workers protection legislation. Newsom said he is working hard with the legislature to ensure it passed and is confident it will be done by the end of this legislative calendar.

Also asked, if Newsom supports the idea of western grid regionalization that was introduced by Assemblymember Holden last year, which supporters say will lead to better coordination of sharing energy supply in the west. Newsom expressed concerns over labor, reliability, transparency and the current administration in Washing D.C and others but said he very familiar with the concept.  

The briefing concluded approximately at 12:50 PM PDT.

The California Department of Public Health (CDPH) has announced the most recent statistics on COVID-19.  There are now a total of 628,031 (+1.0 percent increase) confirmed positive cases and 11,242 (+0.2 percent) deaths in California.  As of August 15^th, there have been 9,933,780 tests conducted in California and reported to the California Department of Public Health.  This represents an increase of 135,645 tests over the prior 24-hour reporting period.  More information regarding the most recent COVID-19 statistics can be found here. 

On August 14^th, Newsom announced that every eligible local educational agency in California has applied for and is receiving a portion of the $5.3 billion in learning loss mitigation funds secured through the state budget he signed in June.  The Governor also signed an executive order directing state agencies across government to bridge the digital divide, building on the state’s efforts to provide computing devices and hotspots to students across the state.  The text of the Governor’s executive order can be found here and a copy can be found here.  A copy of the Governor’s Office press release can be found here.

Also, on August 14^th, Newsom announced the appointment of new executive team members at the Employment Development Department (EDD), and a senior advisor at the Labor and Workforce Development Agency.  A copy of the Governor’s Office press release can be found here.

The https://www.covid19.ca.gov/ website is being updated continuously.  A complete list of the state’s ongoing COVID-19 response efforts can be found here.

Naomi Padron

Legislative Advocate

McHugh Koepke & Associates

1121 L Street, Suite 103

Sacramento, CA 95814

(916) 930-1993

www.mchughgr.com

SPECIAL ALERT On August 3, 2020, a federal district judge ruled that the U.S. Department of Labor (DOL) exceeded its authority with respect to certain paid-leave eligibility requirements when interpreting the Families First Coronavirus Response Act (FFCRA). Although the decision was issued by a federal district court in New York, employers in California should follow its interpretation until an appellate court reviews the decision or other courts weigh in on the issues. (You can read the full opinion here.)   Here are the key takeaways: Employers Must Provide FFCRA Leave Even When There is Not Work Available. Employers May Only Ban Intermittent Leave When It Poses a Higher Risk of Infection. Employers May Not Impose Documentary Requirements as a Precondition to Leave. The DOL's Definition of "Health Care Provider" is Too Broad. Get more details on each takeaway here >>   What Employers Need to Know:   For now, employers should follow the court’s interpretation regarding work availability, intermittent leave, documentation requirements, and the definition of a "health care provider." Employers may refer to DOL guidance regarding all other FFCRA issues.