David Kirkpatrick

July 8, 2010

From the department of “no duh”

The only thing the title of this release left out is it would also reduce both crime and the caseload of the California court system.

The release:

Legalizing marijuana in California would lower the price of the drug and increase use, study finds

Legalizing the production and distribution of marijuana in California could cut the price of the drug by as much as 80 percent and increase consumption, according to a new study by the nonprofit RAND Corporation that examines many issues raised by proposals to legalize marijuana in the state.

While the state Board of Equalization has estimated taxing legal marijuana could raise more than $1 billion in revenue, the RAND study cautions that any potential revenue could be dramatically higher or lower based on a number of factors, including the level of taxation, the amount of tax evasion and the response by the federal government.

Past research provides solid evidence that marijuana consumption goes up when prices go down, but the magnitude of the consumption increase cannot be predicted because prices will fall to levels below those ever studied, researchers say. Consumption also might rise because of non-price effects such as advertising or a reduction in stigma, researchers say.

In addition to uncertainty about the taxes levied and evaded, researchers do not know how users will respond to such a large drop in price. Even under a scenario with high taxes ($50 per ounce) and a moderate rate of tax evasion (25 percent), researchers cannot rule out consumption increases of 50 percent to 100 percent, and possibly even larger. If prevalence increased by 100 percent, marijuana use in California would be close to the prevalence levels recorded in the late 1970s.

The analysis, prepared by the RAND Drug Policy Research Center, was conducted in an effort to objectively outline the key issues that voters and legislators should consider as California weighs marijuana legalization.

“There is considerable uncertainty about the impact that legalizing marijuana in California will have on consumption and public budgets,” said Beau Kilmer, the study’s lead author and a policy researcher at RAND. “No government has legalized the production and distribution of marijuana for general use, so there is little evidence on which to base any predictions about how this might work in California,”

The analysis also suggests that the annual cost of enforcing current marijuana laws is smaller than suggested by others. The RAND study estimates that the cost of enforcing the current laws probably totals less than $300 million.

“It is critical that legislators and the public understand what is known and unknown as the state weighs this unprecedented step,” said Rosalie Liccardo Pacula, a study co-author and co-director with Kilmer of the RAND Drug Policy Research Center.

Two proposals are pending that would legalize the production and sale of marijuana in California. Assembly Bill 2254 authored by Assemblyman Tom Ammiano (D-San Francisco) would legalize marijuana for those aged 21 and older and task the state Department of Alcoholic Beverage Control with regulating its possession, sale and cultivation. The bill would create a $50 per ounce excise tax and these funds would be used to fund drug education, awareness, and rehabilitation programs under the jurisdiction of the State Department of Alcohol and Drug Programs.

In November, California voters will consider a ballot measure titled the Regulate, Control and Tax Cannabis Act of 2010 that would make it legal for those aged 21 and older to cultivate marijuana on a 5-foot-by-5-foot plot, and possess, process, share or transport up to one ounce of marijuana. In addition, the initiative would authorize cities or counties to allow, regulate and tax the commercial cultivation and sales of marijuana. Such activities would remain illegal in jurisdictions that do not opt in.

In only two countries have there been changes in the criminal status of supplying marijuana. The Netherlands allows for sale of small amounts of marijuana (5 grams) in licensed coffee shops and in Australia four jurisdictions have reduced the penalties for cultivation of a small number of marijuana plants to confiscation and a fine. Neither has legalized larger-scale commercial cultivation of the sort California is considering.

In 1975, California was one of the first states to reduce the maximum penalty for possessing less than an ounce of marijuana from incarceration to a misdemeanor with a $100 fine. In 1996, California became the first state to allow marijuana to be grown and consumed for medical purposes.

RAND researchers say one effect of legalizing marijuana would be to dramatically drop the price as growers move from clandestine operations to legal production. Based on an analysis of known production costs and surveys of the current price of marijuana, researchers suggest the untaxed retail price of high-quality marijuana could drop to as low as $38 per ounce compared to about $375 per ounce today.

RAND researchers caution there are many factors that make it difficult to accurately estimate revenue that might be generated by any tax on legal marijuana. The higher the tax, the greater the incentives would be for a gray market in marijuana to develop, researchers say.

“A fixed excise tax per ounce may give producers and users an incentive to shift to smaller quantities of higher-potency forms of marijuana,” said study co-author Jonathan P. Caulkins, the H. Guyford Stever Professor of Operations Research at Carnegie Mellon University’s Heinz College and Qatar campus. Such a shift is another factor that could lower revenues collected from marijuana taxes.

In addition, since the November ballot initiative leaves it to local governments to set tax rates, the size of any levy could vary broadly. A jurisdiction with a low tax rate might attract marijuana buyers from elsewhere in the state or even other states, further complicating efforts to predict government revenues from the sale of legal marijuana, according to researchers.

The RAND report also investigates some of the costs to the state and society in general, such as drug treatment and other health expenses, that may change if marijuana is legalized in California.

It’s unclear whether legalizing marijuana may increase or decrease drug treatment costs, according to the study. More than half of the 32,000 admissions for treatment of marijuana abuse in California during in 2009 resulted from criminal justice referrals, which could drop if legalization is approved. However, an increase in marijuana use could cause a spike in those who voluntarily seek treatment for marijuana abuse, researchers say.

###

The report, “Altered State? Assessing How Marijuana Legalization in California Could Influence Marijuana Consumption and Public Budgets,” can be found at www.rand.org. Funding for this study was provided by RAND’s Investment in People and Ideas program, which combines philanthropic contributions from individuals, foundations, and private-sector firms with earnings from RAND’s endowment and operations to support research on issues that reach beyond the scope of traditional client sponsorship.

Other authors of the study are Robert J. MacCoun of the University of California, Berkeley, and Peter H. Reuter of the University of Maryland.

The RAND Drug Policy Research Center is a joint project of RAND Health and the RAND Safety and Justice program within RAND Infrastructure, Safety, and Environment. The goal of the RAND Drug Policy Research Center is to provide a firm, empirical foundation upon which sound drug policies can be built.

The RAND Corporation is a nonprofit research organization providing objective analysis and effective solutions that address the challenges facing the public and private sectors around the world. To sign up for RAND e-mail alerts: http://www.rand.org/publications/email.html

February 20, 2010

Just one more reason California is a moving train wreck

Filed under: et.al., Politics — Tags: , , , — David Kirkpatrick @ 2:15 am

This almost doesn’t seem real, but the date isn’t April 1 and the source isn’t the Onion.

Yikes!

From the link:

Tracy residents will now have to pay every time they call 9-1-1 for a medical emergency.

But there are a couple of options. Residents can pay a $48 voluntary fee for the year which allows them to call 9-1-1 as many times as necessary.

Or, there’s the option of not signing up for the annual fee. Instead, they will be charged $300 if they make a call for help.

(Hat tip: Fark)

October 15, 2009

Nanny state in action — Cali-style (yet again)

This time California is looking to ban big screen televisions that eat too much power. There’s some competition out there, but California remains the champion of nanny states in the U.S.

From the link:

Reporting from Sacramento – The influential lobby group Consumer Electronics Assn. is fighting what appears to be a losing battle to dissuade California regulators from passing the nation’s first ban on energy-hungry big-screen televisions.

On Tuesday, executives and consultants for the Arlington, Va., trade group asked members of the California Energy Commission to instead let consumers use their wallets to decide whether they want to buy the most energy-saving new models of liquid-crystal display and plasma high-definition TVs.

“Voluntary efforts are succeeding without regulations,” said Doug Johnson, the association’s senior director for technology policy. Too much government interference could hamstring industry innovation and prove expensive to manufacturers and consumers, he warned.

But those pleas didn’t appear to elicit much support from commissioners at a public hearing on the proposed rules that would set maximum energy-consumption standards for televisions to be phased in over two years beginning in January 2011. A vote could come as early as Nov. 4.

June 5, 2009

Lauding nuclear energy shutdown?

Not sure if this something to be proud of. I bet Sacramento wished Rancho Seco was still operating during those rolling blackouts a few years ago …

The release hot from the inbox:

Nuclear Reactor Shutdown Vote 20 Years Ago Reverberates Today in Actions by 900 Mayors and Renewable Portfolio Standards in 2 Dozen States

“Shot Heard Round the World” Echoes in Strong Local, State Opposition Across U.S. to New Nuclear Reactors

SACRAMENTO, Calif., June 5 /PRNewswire-USNewswire/ — Ahead of the 20th anniversary on Saturday of Sacramento voters going to the polls to shut down Rancho Seco, a nuclear reactor operated by the Sacramento Municipal Utility District (SMUD) about 25 miles southeast of the city, organizers held a news conference today to mark the event.

In his remarks at the news conference, Scott Denman, former executive director of the national Safe Energy Communication Council, emphasized that votes against nuclear power continue to this day.

Since the historic Rancho Seco shutdown vote, more than two dozen states have legislated or passed referenda requiring that utilities meet a specific target – usually ranging 10-30 percent of the electricity supply – for sustainable energy resources by a specific date, Denman said.  Power that will be available from these “renewable portfolio standards” (RPS) sources is now routinely cited as a reason not to pursue more nuclear reactors.

Additionally, Denman noted that more than 900 elected mayors of cities including Denver, Chicago, Portland, Austin, and Salt Lake City have signed the Mayor’s Initiative on Climate Change to use sustainable energy resources to power their jurisdictions to prosperity.

Denman’s prepared remarks for the news conference read as follows:

“Good morning.  I am a national energy policy consultant and the former executive director of the national coalition, Safe Energy Communication Council.  In 1988, and again in 1989, I coordinated the national environmental community in assisting the local sponsors of the ultimately successful ballot initiatives and campaigns to close the Rancho Seco reactor.

Twenty years ago, I hailed the victory as ‘a shot heard ’round the world.’ I said then that the intrepid organizers and those who voted to shutdown the reactor were ‘a new breed of American patriots’ and that this historic vote would spark the shift away from costly and dangerous reactors, and catalyze a movement for clean, affordable, safe, secure energy efficient and renewable energy technologies.  That is exactly what has happened.

Since this pioneering vote in 1989, more than two dozen states have legislated or passed referenda requiring that utilities provide a specific percentage – typically ranging between 10-30 percent of the electricity supply – to be generated by sustainable energy resources by a date certain.  More than 940 mayors of cities like Denver, Chicago, Portland, Austin, and Salt Lake City representing 84 million Americans have signed the Mayor’s Initiative on Climate Change to use sustainable energy resources to power their jurisdictions to prosperity.

By terminating the Rancho Seco reactor, Sacramento’s public power utility, the Sacramento Municipal Utility District (SMUD), today has significantly lower rates than PG&E, Southern California Edison, and many other U.S. utilities.  Indeed, SMUD’s innovative energy efficiency and conservation programs have been replicated with great success.  SMUD’s pioneering work to bring utility grade solar and other renewably produced electricity to the grid has been a viable model for communities and utilities.

Proposed new nuclear reactors would simply be too expensive and also take too long to build.  Since the vote (and some 15 years before it), not one new reactor has been licensed.  Sacramento’s voters were prescient as well as prudent managers of their own pocketbooks.  New reactors are now estimated cost customers about 15 cents per kilowatt-hour on monthly electric bills, more than two times more expensive than wind power. In comparison, energy efficiency improvements cost consumers zero to five cents per kilowatt hour.   One Pennsylvania utility (PPL) has just announced that its proposed reactor will cost ratepayers a staggering $15 billion dollars.  Thus, new reactors are a fiscal black hole and loom as a fool’s gold solution to the growing real threat of global greenhouse gases.

The nuclear and utility industries keep coming back to the public trough for more and more bailouts, handouts, tax breaks, and subsidies.  Now, nuclear cheerleaders in Congress are trying to force you and me, the taxpayers to give away more than $100 billion in dangerous loan guarantees and other financial shell games that shift responsibility for failed nuclear projects on to the backs of the American families and businesses.  The Congressional Budget Office has concluded that 50% of new nuclear reactor loans will default.  The nuclear industry and their lobbyists want us to take the risk while they pocket the profits.  This path is a sure way to repeat the disastrous failure of subprime mortgages and unregulated bad debt that nearly collapsed our entire financial system in the past 12 months.

It’s time to give wind, geothermal, solar and energy efficiency its first real chance.   New reactors would lead us to more lemons like Rancho Seco, deeper national financial debt, and further economic crisis.

We have sustainable energy resources today that we, our children, and our grandchildren can live with.  The bottom line lesson from Ranch Seco 20 years later:  Don’t get fooled by the same old promises of nuclear reactors.  We can’t pay the price.   Thank you.”

Other news event participants included former California State Senator Tom Hayden; former SMUD Board Member Ed Smeloff; and Bob Mulholland, campaign manager, No on Measure K.

Source: Physicians for Social Responsibility, Washington, D.C.
   

Web Site:  http://www.psr.org/ranchoseco

September 25, 2008

Interested in installing solar in California?

Here’s some useful information.

The press release:

Residential Leases and PPAs; Questions for Homeowners to Ask If Considering a Solar Lease or a Solar Power Purchase Agreement

RIO VISTA, Calif.–(BUSINESS WIRE)–In 2008 new financing options for homeowners wanting solar systems were introduced in California. These options were designed to overcome the biggest obstacle to potential solar users: the first cost to acquire the system. For typical residential solar installations the cost is around $40,000 but after tax credits and state rebates it is usually around $25,000 in out-of-pocket expenses. Most homeowners pay cash or finance the purchase.

For homeowners who are considering one of the new leasing or power purchase methods, there are important considerations because these homeowners will not own the system. The system will be owned by the leasing company or the power purchase company.

How does a lease or power purchase agreement work?

A lease allows a customer to make a monthly payment over a fixed term, like 5, 10, or 15 years. At the end of the term the homeowner will have the option of paying for the remaining value of the system or having it removed. Interest is charged on the balance of the value of the solar system for the duration of the lease.

A power purchase agreement is a long term contract to buy electricity produced by the solar system. The term of the contract is typically 15 to 20 years. The site owner does not own the solar system during the term of the contract. At the end of the contract the homeowner will have the option to purchase the system for the remaining value of the system or having it removed. Some of these contracts also allow a customer to purchase the system before the end of the term of the contract. The cost of the electricity from the solar system will escalate over the term of the contract and the escalation rate will be specified in the contract. The escalation rate may or may not be at the same rate that the local utility will charge over the same period. The homeowner will still be a customer of the local utility and purchase electricity from the utility when the solar system does not produce electricity (such as overnight or on a cloudy day).

In both a lease or power purchase agreement, the company receives both the tax credit and any state rebates.

Do state or federal regulations govern these leases or power purchase agreements?

Not at this time. These financing options are a new development in the retail solar market. Power purchase agreements have been used successfully for transactions between wholesale power generators and utilities. They have also been used successfully in large commercial solar installations since 2006. The terms and conditions of the commercial power purchase agreements are negotiable and most commercial projects are reviewed by the customers attorney(s) and accountant(s).

Legislation recently sent to the Governors signature (AB 2863, 2008) will establish disclosure requirements for residential leases and power purchase agreements. If the bill is signed into law, it will require:

1. A good faith estimate of the kilowatt-hours to be delivered by the solar energy system.

2. A plain language explanation of the terms under which the pricing will be calculated over the life of the contract and a good faith estimate of the price per kilowatt-hour.

3. A plain language explanation of operation and maintenance responsibilities of the contract parties.

4. A plain language explanation of the contract provisions regulating the disposition or transfer of the contract in the event of a transfer of ownership of the residence, as well as the costs or potential costs associated with the disposition or transfer of the contract.

5. A plain language explanation of the disposition of the solar energy system at the end of the term of the contract.

AB 2863 will also require that the leasing or power purchase company:

- Record a notice on the title of the property. If the contract is terminated or sold, they must file a new notice.

- Must provide a copy of the contract to a prospective buyer of the home if the homeowner is selling their home.

Questions to ask if a homeowner is considering a solar lease or solar power purchase agreement

Since homeowners do not usually have an attorney and accountant to review the agreements, the following questions are good questions to ask if they are considering a lease or power purchase agreement to have a solar system installed on a home. Getting these questions answered in writing will help the homeowner in the event that a dispute develops later about the terms of the arrangement.

Installation

1. Who is the installation company? (Not all financing companies have a contractors license so they will contract with an installation company to perform the construction work.)

2. Does the contractor have a license to install solar?

3. Does the contractor have workers compensation insurance?

4. Is the contractor reputable and have a good track record for installations?

5. Can the contractor file a mechanics lien against the house?

6. Is there a separate contract for the installation of the system?

Contract terms

7. What is the assumed inflation (sometimes called escalation) rate for the solar electricity payments? (If the solar electricity payments escalate faster than the utility electric rates can the homeowner end up paying more for electricity over the life of the contract because they bought a solar system?

8. Does the contract obligate the homeowner to buy the system at the end of the contract? How much will the homeowner be expected to pay at the end of the contract? (Some contracts will state that the homeowner must pay the fair market value for the system. What is the value of the system after 10 years? 15 years? What is the actual cash price at the end of the term (not adjusted down for value of money)?

9. What happens if a homeowner refinances the house? Are there any clauses or language in the agreement restricting this? Are there any documents that the bank or appraiser will need?

10. Who is insuring the system in the event of damage (due to accidental damage to the home or vandalism, for example)? Does the homeowner have to pay for any or all damages? What should the homeowner report to their insurance company? Assuming the company insures the system; will the homeowner receive a certificate of insurance naming the homeowner on the companys insurance policy?

11. Who is responsible for the warranty of the system? Is the warranty to the homeowner from the installer or is the warranty from the installer to the leasing or PPA company? Who does the homeowner file a claim against if theres a problem, like a roof leak? Has the company had any claims? How have they been handled?

Terms of the Contract

12. Are there any costs to buy out the lease or PPA early in the first 5 years? If the homeowner buys out the lease or PPA in the first 5 years will they have to also pay the company for the loss of the tax credits and depreciation?

13. What is the implicit interest rate that the homeowner is paying in the lease/PPA?

14. What happens if the homeowner needs a new roof and the system needs to be moved? Who will cover the module warranties if the modules are moved? (Many module manufacturers void the warranty if the modules are moved).

15. Whose responsibility is it to restore the roof and replace shingles or tiles if the homeowner decides to have the system removed at the end of the term?

Sale of Home during term of Contract

16. What happens if the homeowner sells their home?

17. Can the contract be sold or assigned to someone else if the house is sold? What is the qualification process/what are the requirements for a new party assuming the lease/PPA?

18. What if someone who wants to buy the house but doesnt qualify to assume the lease/PPA?

19. What if someone who wants to buy the house but doesnt want the solar system?

System Performance

20. Does the company provide production guarantees? How is that tracked and does that affect the monthly payments that the homeowner makes (i.e., will the monthly payment be adjusted if the system underperforms?

21. Is the homeowner responsible for any of the maintenance or monitoring?

22. Assuming the homeowner monitors the system, if there are production issues what is the companys response time?

Fiscal condition of the Financing Company

23. Is the company financially sound?

24. Can the company sell the contract to a new entity? Will the homeowner be notified?

25. What happens if the leasing company or PPA company goes out of business?

26. Could the system be repossessed or removed if the PPA/leasing company gets into financial trouble?

27. Does the company maintain a reserve account for repairs? How much is set aside for repairs and are the funds kept in an escrow account?

About CALSEIA: Since 1977, California Solar Energy Industries Association has supported the widespread adoption of solar thermal and photovoltaic systems by educating consumers, supporting solar legislation and conducting business in a professional and ethical manner. www.calseia.org includes a list of solar companies that are members. Click on Find an Expert.

July 25, 2008

Nanny state — actually State this time — California style

Filed under: Politics — Tags: , , , — David Kirkpatrick @ 10:54 pm

Cali gets this post for banning trans fats. Can’t wait to see the next “health” crusade from the government overlords who know better than you or me what to put into our bodies.

Really all the rampant statism all over the US these days is ridiculous. And un-American. Good job, Arnie.

From the link:

 California, a national trendsetter in all matters edible, became the first state to ban trans fats in restaurants when Gov. Arnold Schwarzenegger signed a bill Friday to phase out their use.

Under the new law, trans fats, long linked to health problems, must be excised from restaurant products beginning in 2010, and from all retail baked goods by 2011. Packaged foods will be exempt.

New York City adopted a similar ban in 2006 — it became fully effective on July 1 — and Philadelphia, Stamford, Conn., and Montgomery County, Md., have done so as well.

March 7, 2008

Obama’s delegate gain in Cali

Filed under: Politics — Tags: , , , , , — David Kirkpatrick @ 2:01 pm

This Tuesday California officially certified its primary. In the final tally Clinton lost four delegates and Obama picked up four.

A net gain of eight delegates for Obama in the overall count. As the linked Daily Kos post mentioned, this was never mentioned in the breathless political coverage Tuesday night. Delegate-wise the impact is significant.

February 4, 2008

Tsunami Tuesday in Cali

Filed under: Politics — Tags: , , — David Kirkpatrick @ 4:34 pm

California is a key Tsunami Tuesday state tomorrow. Here’s an article covering some of the issues, but mostly focused on the Obama/Clinton battle.

 From the article:

An independent Field Poll released Sunday showed Clinton’s long-standing advantage over Obama had evaporated. The race is now a dead heat, with Clinton at 36 percent and Obama at 34 percent among likely Democratic primary voters.

In mid-January, Clinton held a 12-point edge. The poll also found that 18 percent of voters remain undecided, making a last-minute campaign push all the more crucial.

Among Republicans, Sunday’s Field Poll showed McCain with an 8-point lead over Romney, 32 percent to 24 percent. Huckabee had the support of 13 percent of likely voters, with 15 percent undecided.

January 29, 2008

Obama making gains in Cali

Filed under: Politics — Tags: , , , , — David Kirkpatrick @ 1:52 pm

Interesting Dem poll numbers and analysis from California. These results show the Clinton lead is much more narrow than previously thought (down to 11 points from what some polls had in the 20 point range.)

Maybe even more interesting is Obama is beginning to get a real bounce from the South Carolina blowout, and analysis of the raw poll numbers point to the race being more close than even 11%.

(Hat tip: the Daily Dish)

January 11, 2008

Nanny state in action Cali style

Filed under: et.al., Politics — Tags: , , , — David Kirkpatrick @ 12:40 am

I actually found this via Samizdata. This American Thinker post covers a legislative movement in California to gain control over the thermostats in private residences.

Wow. Nanny statism out of control. I can’t see something like this making it into law, but I’m not in California. Just wow.

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