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California Governor Gavin Newsom Signs New Budget Creating Nation’s First Tax Credit For Union Dues

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California Governor Gavin Newsom Signs New Budget Creating Nation’s First Tax Credit For Union Dues


In probably the most populous state within the U.S., California, main politicians usually speak about fairness, equality, and their efforts to realize each. But a tax break included within the new California state finances signed by Governor Gavin Newsom (D) on June 27 will exacerbate present inequality in state taxation, critics contend.

California is certainly one of solely a handful of states the place union dues are tax deductible for state revenue tax functions. As a part of the brand new state finances lately signed by Newsom, California lawmakers have made that focused tax break much more beneficial.

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The brand new finances handed by lawmakers in mid-June and signed by Governor Newsom two weeks later will take California’s present tax deduction for union dues funds and switch it right into a tax credit score capped at 33% of dues paid. Altering the deduction to a credit score makes the union tax break extra beneficiant and advantages those that don’t itemize or have a tax legal responsibility.

“Whereas union dues are at present tax deductible, union employees usually tend to not itemize their deductions and subsequently don’t get the identical tax profit for his or her dues that greater paid professions usually tend to get for his or her skilled affiliation dues,” notes the finances ground report. The creation of this new tax credit score was praised by union leaders. In an announcement launched shortly after Governor Newsom signed the brand new finances, Amber Baur, government director for The United Meals and Industrial Staff (UFCW) Western States Council, thanked Newsom and state legislators for “permitting employees to degree the enjoying subject that tries to maintain them on the backside.”

This enhanced tax break for union members within the new California finances was dubbed the “Staff Tax Equity Credit score.” However critics declare equity is an ironic phrase to make use of for the reason that credit score is just not obtainable to the overwhelming majority of employees.

“In California, it’s ‘authorities of the unions, by the unions, for the unions,’” mentioned Jon Coupal, president of the Howard Jarvis Taxpayers Affiliation. The union dues tax credit score within the new finances boosts a tax break most employees can’t make the most of as a result of solely 15.9% of the state’s workforce is unionized, in keeping with the Bureau of Labor Statistics.

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The enactment of the nation’s first state tax credit score for union dues funds comes a number of months after Democrats in Congress tried to enact an above-the-line federal tax deduction for union dues funds that might be obtainable even to taxpayers who don’t itemize. Critics of that proposal, which was included within the Construct Again Higher spending bundle handed by the Home of Representatives in 2021, level out it was focused to learn a small minority of employees who disproportionately donate to Democratic campaigns, as is the case for California’s new union dues tax credit score.

“In impact, they’ve compelled the 90% of employees in America who aren’t in a union to subsidize the dues of those that are,” mentioned Consultant Kevin Brady (R-Texas), Home Methods and Means Committee rating member, of the union dues deduction that congressional Democrats proposed however have so far been unable to enact.

“By making union dues tax deductible, Democrats are primarily making it extra financially viable for individuals to contribute to organizations that assist elect Democrats,” wrote Dominic Pino, a Nationwide Overview Institute fellow, in regards to the federal union dues deduction. The identical argument might apply to the union dues tax credit score within the new California finances. Pino and others who make this assertion can level to political spending knowledge from Open Secrets and techniques, which reveals 90% of union donations to federal campaigns throughout the 2020 election cycle had been directed to Democrats.

Others, nevertheless, contend that altering the union dues deduction to a credit score will make the tax profit extra progressive and apply extra broadly than is at present the case.

“Generally the transfer from a deduction to a credit score will usually make the tax coverage extra progressive as the worth of the tax expenditure will not be depending on the tax fee confronted,” mentioned Kim Rueben, the Sol Value Fellow and director of the State & Native Finance Initiative on the City-Brookings Tax Coverage Middle. “In a state like California this normally will likely be very true given the progressive nature of its state revenue tax and who owes revenue tax. That is particularly the case in making it a refundable credit score and never requiring the tax-payer to itemize. So the change would make the profit obtainable to a broader set of Californians and extra equitable throughout completely different union employees inside the state.”

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Whereas California lawmakers are strengthening a union tax break from which most Californians gained’t profit, there’s an ongoing effort to make use of authorities union pension funds for political functions. Senate Invoice 1173, launched by Senator Lena Gonzalez (D-Lengthy Seaside), would “prohibit the California Public Staff Retirement System (CalPERS) and the California State Academics’ Retirement System (CalSTRS) from investing in fossil gas firms, and require that they divest any present investments by 2027.”

A 2015 examine by College of Chicago Regulation Professor Daniel Fischel underscores the monetary hit California pensioners and taxpayers would take had been state lawmakers to go SB 1173. Fischel’s report, which checked out 11 of the highest pension funds, quantified the monetary hurt brought on by pension divestment from fossil fuels. In keeping with Professor Fischel’s analysis, funds narrowly divested from fossil fuels see an annual shortfall of 0.15%, whereas funds broadly divested face an annual shortfall of 0.2%. Although that will not sound like a big influence to many, it makes an incredible distinction to pension funds, translating into billions of {dollars} in forgone positive factors.

California’s authorities employee pension methods already face mixed unfunded liabilities projected to exceed $1 trillion. California taxpayers, who already toil underneath one of many nation’s heftiest tax burdens, are on the hook for this shortfall. By decreasing funding returns, divesting state pension funds from fossil fuels would trigger these massive unfunded liabilities to develop additional, which is unhealthy information for each union pensioners and all California taxpayers.

Although SB 1173 handed out of the Senate, it was pulled on June 21 by Assemblyman Jim Cooper (D-Elk Grove), who chairs the Meeting Committee on Public Employment and Retirement. Critics of SB 1173 argued, successfully it seems given the invoice’s demise, that union retirees and all California taxpayers can be harmed if state pension funds divested from fossil fuels. Related fossil gas pension divestment proposals have been rejected in different blue states for a similar purpose.

The primary half of 2022 was a combined bag for California taxpayers who don’t need the state to inflict extra prices upon households and the economic system. Pensioners and the taxpayers who’re on the hook for unfunded authorities pension liabilities don’t have to fret about pension returns being diminished by fossil gas divestment, not less than in the intervening time. Many Californians, nevertheless, are unlikely to understand the truth that Governor Newsom and state legislators created a brand new tax credit score that’s unavailable to 84% of Golden State employees. For all of the speak about fairness & equality coming from the state’s strongest politicians, California’s new finances takes the state tax code’s already unequal therapy of employees and worsens it.

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California doctor who drove Tesla off cliff with family inside won’t face trial, granted mental health diversion

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California doctor who drove Tesla off cliff with family inside won’t face trial, granted mental health diversion


The “suicidal” California doctor accused of intentionally driving his Tesla off a cliff with his wife and two young children inside won’t face trial for attempted murder as he is instead set to begin a mental health diversion program.

Dharmesh Patel, who was granted admission into the two-year program last Thursday at the San Mateo County Court, will remain in jail for “several weeks” before he’s released, the San Mateo District Attorney told NBC News.

The radiologist, who has spent the last 18 months behind bars. will be released from jail to his parent’s home where he will be ordered not to leave.

He will also have to report to court weekly for a progress report.

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Patel will be ordered to be tested twice a week “to show medication compliance,” and will have to abstain from drugs and alcohol while also forfeiting his driver’s license and passport, the outlet reported.

Dharmesh Patel won’t face trial for his attempted murder charges after his admittance into a mental health diversion program. David G. McIntyre for NY Post

The doctor will return to court on July 1 where details of his release will be determined, a spokesperson for District Attorney Stephen Wagstaffe told NBC News.

Judge Susan Jakubowski granted Patel admission to the program while the DA’s office “intensely” opposed it.

The radiologist appeared “by all accounts a kind and loving” father, said Jakubowski on Thursday, adding that Patel would be better served in treatment than in jail, the Mercury News reported.

Last week’s ruling was made after evidence was found showing Patel has major depressive disorder.

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Patel was accused of driving his Tesla Model Y off the 250-foot cliff off “Devil’s Slide” on Highway 1 and landing on the shore of the Pacific Ocean in Jan. 2023. AP
Miraculously, Patel, his wife and their two children — a 7-year-old daughter and 4-year-old son — all survived. Facebook/Neha Patel

In April two doctors testified in court that Patel suffered from “major depressive order” and experienced a “psychotic” break during the attempted murder-suicide on Jan. 2, 2023.

The Tesla Model Y plummeted off the 250-foot cliff off “Devil’s Slide” on Highway 1 and landed on the shore of the Pacific Ocean.

Miraculously, Patel, his wife and their two children — a 7-year-old daughter and 4-year-old son — all survived.

Patel was arrested and later charged with three counts of attempted murder. He initially pleaded not guilty to the charges saying the Tesla experienced a malfunction causing the car to careen off the cliff.

His wife Neha later told investigators her husband had suffered from depression before the crash.

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“He’s depressed. He’s a doctor. He said he was going to drive off the cliff. He purposefully drove off,” Neha told rescuers.

During his testimony, psychologist Mark Patterson said Patel’s delusions were provoked by the nation’s fentanyl crisis, the war in Ukraine and feared his children could be kidnapped and molested, which appeared to have been connected to Patel’s worries about accused sex trafficker Jeffrey Epstein.

In May, Neha Patel begged prosecutors to drop the charges and admit her husband into the program.

In April two doctors testified in court that Patel suffered from “major depressive order” and experienced a “psychotic” break during the attempted murder-suicide. AP
Neha Patel later told investigators her husband had suffered from depression before the crash. Facebook/Neha Patel

“We need him in our lives and it has been over a year and a half since my children or I have seen or spoken to Dharmesh,” she said.

The doctor was deemed a good candidate for the program because he’s at low risk of injuring anyone else and has shown progress with his treatment since the crash, Patterson said.

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California Shelves Repeal of 1950 Housing Law That Stoked Racial Tension | KQED

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California Shelves Repeal of 1950 Housing Law That Stoked Racial Tension | KQED


“While SCA 2 was one of many efforts to help address the housing crisis, the November’s ballot will be very crowded, and reaching voters will be difficult and expensive,” Allen said in a statement. “In addition, the legislature recently passed my SB 469, which substantially addresses some of the most significant concerns about how Article 34 might be impacting housing production.”

SB 469 clarifies that the use of state affordable housing dollars does not trigger Article 34’s requirement for voter approval. Allen said his focus is on determining whether these efforts are “making a significant dent in addressing the problem,” adding that quickly building more affordable housing is a priority.

Backed by the California Real Estate Association, the forerunner to the current California Association of Realtors, Article 34 was first adopted by voters in 1950. Realtors played on voters’ fears that affordable housing would lead to greater racial integration of exclusively white neighborhoods.

CAR issued a formal apology in 2022 for its past support of Article 34, with association President Otto Catrina condemning the actions and vowing to address the legacy of its “discriminatory policies and practices.”

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The organization “remains a strong supporter of the repeal of Article 34 … which adds unnecessary hurdles and costs to the creation of affordable housing,” CAR spokesperson Sanjay Wagle said in a statement.

Wagle noted that a majority of Californians support repealing the provision but cited research showing a voter education campaign would be needed to explain the article’s effects.

“The cost of such a campaign in an election year with so many initiatives on the ballot made this campaign more costly and difficult, thus making it more logical to pursue a repeal on a future ballot,” Wagle wrote. “We thank Sen. Allen and Sen. Wiener for their efforts on this repeal effort and look forward to working [with] them and other stakeholders on this issue in the future.”





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California Quarterback Commits to Penn State’s 2026 Recruiting Class

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California Quarterback Commits to Penn State’s 2026 Recruiting Class


Though Penn State has been busily filling its 2025 recruiting class in June, the program hasn’t stopped looking ahead. The Nittany Lions on Tuesday received a commitment from 4-star California quarterback Troy Huhn, who became the second player in Penn State football’s 2026 recruiting class.

Huhn (6-4, 205 pounds) will be a junior at Mission Hills High, just north of San Diego. He threw for 1,623 yards and 16 touchdowns as a sophomore last season. Huhn quickly built a strong offer sheet that included Michigan, Ohio State, Oregon, Texas, Auburn and Notre Dame, among many others. Huhn took an unofficial visits to Ohio State and Penn State in June, committing to the Nittany Lions two weeks after his trip.

Huhn is the 2026 recruiting class’ 10th-rated quarterback prospect, according to the 247Sports Composite, and a top-15 player in California. On3 ranks Huhn highest among the major recruiting services, slotting him at No. 60 nationally and sixth at quarterback.

Huhn, who committed to Penn State offensive coordinator Andy Kotelnicki and quarterbacks coach Danny O’Brien, spent time with head coach James Franklin during his unofficial visit. He told Sean Fitz of Blue-White Illustrated that Franklin made an impression.

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“Coach O’Brien was great, but really my main thing when I was getting out there was to have more time with coach Franklin. They definitely gave that to me,” Huhn said in his interview with Blue-White Illustrated. “I really felt the love from coach Franklin. He’s very business, he’s awesome, he’s a funny guy. My mom loves him, he loves my mom. That relationship with him is now a lot better and I’m glad I got to spend that time with him.”

Huhn joins Harrisburg athlete Messiah Mickens on the ground floor of Penn State’s 2026 recruiting class. Mickens committed to Penn State in August 2023. Penn State had been recruiting several 2026 quarterbacks alongside Huhn. One of their targets, Dia Bell, recently committed to Texas.

Huhn’s commitment continued a prolific stretch for the Nittany Lions. Franklin and his staff have received commitments from five players in a four-day stretch. Four of them committed to Penn State’s 2025 recruiting class.

The most recent 2025 commitment belonged to Max Granville, a 4-star prospect from Texas and first-team all-state honoree as a junior. Granville, who will be a senior at Fort Bend Christian Academy, is rated as a 4-star linebacker according to the 247Sports Composite. However, the 6-3, 220-pound Granville projects at defensive end and was recruited by Penn State defensive line coach Deion Barnes. Granville chose Penn State after making an official visit to State College earlier in June. He also visited USC, Texas A&M and Oklahoma in June and took an official visit to Baylor in April.

Penn State opens the 2024 football season Aug. 31 at West Virginia. The game is scheduled for a noon kickoff on FOX.

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AllPennState is the place for Penn State news, opinion and perspective on the SI.com network. Publisher Mark Wogenrich has covered Penn State for more than 20 years, tracking three coaching staffs, three Big Ten titles and a catalog of great stories. Follow him on Twitter @MarkWogenrich.





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