So far, the highlights of the show have been new HCD Branch Chief John Nun. He roused the crowd yesterday with his opening remarks focused on making the EZ program more transparent and efficient. He informed the audience that his job duties are focused exclusively on the EZ program. He has increased his staff by two members. Each staff member will be assigned to a number of zones that they will be responsible for and in fact intend to visit. John’s on hand’s approach was widely welcomed and highly praised by the audience and by CAEZ President Craig Johnson who gave his own rousing rally-the-troops speech this morning. The theme of these two speakers was the word “unprecedented” which Johnson had the audience recite with him. From lobbying, to public relations to statutory review and close collaboration with HCD, the CAEZ is taking shape and taking charge like never before. Yolanda Benson and Toni Symonds gave insightful presentations regarding current legislation, including AB 1139 and the schedule for the next few months. The legislative discussion seemed to come full circle to Johnson’s message that the audience get involved and continue to the wave of activism that is taking the EZ program to a whole new level.

Here’s an email I received from CAEZ president Craig Johnson about the two new hearings.

Dear CAEZ Members and Friends of CAEZ,

The Speaker of the Assembly has approved two additional Enterprise Zone hearings for the Assembly Committee on Jobs, Economic Development and the Economy. The first is scheduled for October 8 in the Bay Area and the second will be held October 14 in Southern California. Each of the two hearings will have different topics, unknown to us at this time, as is the exact location of the hearings.

Your CAEZ leadership will be meeting with the Enterprise Zone Coalition to discuss strategy and potential speakers, once we know the topics to be discussed and the hearing format. If any of you are available to attend one or both of these hearings, there will be a public comment period where the public is encouraged to speak on any topic related to the Enterprise Zone program. It would serve CAEZ and the EZ program well, to have as many public comment speakers as possible speaking in support of the program. Your active participation in this process is critical to the continued success of the EZ program.

I will keep you apprised as more information is released.

Thank you for your continued support of CAEZ and the Enterprise Zone Program.

CRAIG JOHNSON
President
California Association of Enterprise Zones

Cal-Tax has been asked to participate as amicus before the California Supreme Court in support of respondent Dicon Fiberoptics, Inc. on the merits of Dicon Fiberoptics, Inc. v. Franchise Tax Board. In that case the lower court sustained the FTB’s demurrer in a tax refund lawsuit arising out of a claim for enterprise zone hiring credits. The FTB claimed that because the taxpayer could not produce underlying documentation in support of its vouchers entitling it to hiring credits, the taxpayer could not state a cause of action.

Dicon Fiberoptics appealed to the Second District, claiming that the FTB did not have the right to audit the voucher once issued. The court held that FTB was entitled to audit the voucher, but that the voucher was prima facie evidence that an employee is a qualified worker for the purpose of the hiring credit and the voucher shifts the burden to the FTB to prove that the worker is not qualified. The California Supreme Court has granted review.

This is an important case because the only other case on the issue is Appeal of Deluxe Corporation, a BOE decision that held the FTB has the authority to audit vouchers, and statutes granting FTB authority to examine and audit tax returns bear no exception for decisions by other governmental bodies, such as zone coordinators that issue vouchers. It is important that a Supreme Court decision on this issue be favorable to taxpayers and that it decline to rule that FTB has unlimited authority to require voucher documentation from the taxpayer.

Yesterday was the CAEZ quarterly meeting where a host of new faces were introduced to the EZ world. First, replacing Frank Luera at HCD will be Tom Bettencourt and John Nunn. Both men seem to be well suited for the role. Replacing Jeanne Harriman will be Jayme Mora and James Dudley. They have years of Enterprise Zone experience under their belt and seemed very inviting and helpful. James was even brave enough to give the group his email address. We look forward to a very supportive and beneficial relationship with both groups.

Toni Symonds, chief consultant for California State Assembly Committee on Jobs, Economic Development, and the Economy briefed the group regarding AB 1139. Looks like there will be a public hearing on August 18, 2009 and the bill will likely reach the Committee on January 5, 2010. The discussion will focus on what is the purpose and goals of the EZ and whether the program achieves these goals.

Also, AB 1554, a little known bill, should be garnering support by the CAEZ. AB 1554 aligns the reporting period with the period that HCD was actually administering the program. There will be much more to come, especially regarding AB 1139.

Last, the CAEZ annual conference is coming up on November 4-6 in Fresno.

This morning, CAEZ president Craig Johnson announced that on July 21 & 22, members of the “CAEZ Board of Directors will have the opportunity to meet in Sacramento with members of the Housing and Community Development management team and representatives from the Franchise Tax Board, who will be assuming the position formerly held by our good friend Jeanne Harriman.” Frank Luera recently left his post as head of the HCD and Harriman recently left her post at the FTB. The new government liaisons for the Enterprise Zone program are eagerly anticipated.

Here is Craig Johnson’s recent retort in support of California’s Enterprise Zones. Enjoy the audio.

Dear CAEZ Members & Friends of CAEZ,

In response to the PPIC report, which was making it’s debut in Sacramento today, I appeared on San Francisco radio station KQED this morning along with one of the co-author’s of the study, Jed Kolko. The audio of the show is linked below.

Click for Audio

We will continue to face the slings and arrows of our foes throughout the remainder of the legislative calendar and I urge each of you to be prepared to share the many successes of our program.

Thank you all for your continued support of the program and CAEZ.

CRAIG JOHNSON
President
California Association of Enterprise Zones

CAEZ president Craig Johnson wrote this letter today to the local Enterprise Zone community:

Dear CAEZ Members and Friends of CAEZ,

Following the legislative hearing for AB 1139 on April 29, CAEZ pledged to work with Assemblyman John Perez and the sponsors of AB 1139. To that end, the attached letter was mailed this morning to Assemblyman Perez and all of the Members of the Assembly Committee on Jobs, Economic Development & the Economy. This letter addresses the numerous inaccuracies cited by the supporters of the bill, corrects the record about the program, it’s structure, mission and accomplishments.

CAEZ continues to monitor legislative activity in Sacramento that may affect our program, especially as the Legislature continues to grapple with record budget deficits. I will keep you apprised of any urgent matters that require a call to action of our Membership. Your response to AB 1139 assures me of your commitment to the defense of our program during perilous times.

Thank you again for your continued support of the Enterprise Zone program.

Sincerely,

CRAIG JOHNSON
President
California Association of Enterprise Zones