A year ago, the exodus from our lovely state was news as we discussed here. The trend has accelerated which should accelerate the review of the state's housing requirement numbers as noted here. The odd thing about the faulty RHNA numbers is that no one wants to talk about them. I have mentioned it to several electeds and a watchdog news organization and all I get is crickets. As a city, try to ignore them and Rob Bonta will be all in your face, but question them and he's silent. You would think when a state auditor says this about the calculations, someone would go "hold on":
“Overall, our audit determined that HCD does not ensure that its needs assessments are accurate and adequately supported. …This insufficient oversight and lack of support for its considerations risks eroding public confidence that HCD is informing local governments of the appropriate amount of housing they will need.”
If someone is saying "hold on" they are doing it quietly behind closed doors. But this is what is occurring in California out in the open from the WSJ:
California Gov. Gavin Newsom boasted this week that his state is poised to become the world’s fourth largest economy. Perhaps, thanks to Germany’s economic struggles, but a new Hoover Institution report documents an accelerating business flight from the Golden State.
The report by Hoover senior fellow Lee Ohanian and Spectrum Location Solutions President Joseph Vranich finds that 352 companies moved their headquarters from California between 2018 and 2021. Twice as many businesses left last year (153) than in 2020 and 2019 and three times as many as in 2018. The top destinations: Texas (132), Tennessee (31), Nevada (25), Florida (24) and Arizona (21).
California’s high top marginal income-tax rate (13.3%) punishes small pass-through businesses that pay income taxes at the individual rate as well as managers in C-suites. Manufacturers get slammed by high electricity costs from the state’s climate policies. The Mercatus Center ranks California as the most highly regulated state in the U.S.
Human capital is also becoming more scarce. The report notes that California’s net out-migration to other states increased to 277,000 in 2021 from 34,000 in 2012. Over the last 10 years, California has lost 1.625 million residents to other states—more than the population of Philadelphia. Foreign migration has compensated, but less so in recent years.
Tally that up with the layoffs and hiring slowdowns being reported at the major firms in the Bay Area, and you could say my "confidence is eroded" in the RHNA numbers that drive all of the residential building being jammed down our throats. And the electoral response? Raise the top marginal tax rate some more (Prop. 30) under the guise of fighting wildfires and encouraging more electric cars--like we don't already have enough subsidies and browbeating for EVs.
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