The California Institute For Federal Policy Research
California Capitol Hill Bulletin
Volume 4, Bulletin 9 -- March 13, 1997

[Note:  E-mail is functional again ... thank you for your patience.]

FORTY-ONE MEMBERS OF DELEGATION MEET TO DISCUSS BIPARTISANSHIP AND
ELECTRICITY DEREGULATION; GOVERNOR WILSON ADDRESSES THE GROUP 
     Forty-one members of the California Congressional delegation
met Thursday to discuss working together on non-partisan issues
affecting California.  Reps. Jerry Lewis (Redlands) and Lucille
Roybal-Allard (Los Angeles), deans of the Democratic delegation
and Republican delegation, respectively, called this very
successful first meeting of the entire delegation together to
discuss their efforts to find common ground among the delegation
on issues concerning California.  During the luncheon meeting,
Governor Pete Wilson, who was in Washington, stopped by to address
the group.  He recognized Reps. Lewis' and Roybal-Allard's efforts
to bring the delegation together and was very supportive.  Among
the other priority issues touched upon were the Bay-Delta
agreement, ISTEA reauthorization, and opposition to a per capita
cap on the Medicaid program.
     After the Governor's remarks, D.J. Smith with the AB1890
group briefed the delegation on electric utility deregulation in
California.  AB1890 was enacted by the state legislature with
overwhelmingly bipartisan support after months of painstaking
negotiations among a broad-based coalition of stakeholders,
including manufacturers, consumer groups, environmental groups,
labor, and the state's public and private electric utilities.  As
a result of the meeting, Reps. Lewis and Roybal-Allard are
circulating a delegation letter on utilities deregulation (see
article below).
     Reps. Lewis and Roybal-Allard expect to hold more meetings
for the entire California Congressional delegation as the year
progresses.  

DELEGATION LETTER CIRCULATING ON CALIFORNIA'S ELECTRIC UTILITIES
DEREGULATION EFFORTS
     Reps. Jerry Lewis (Redlands) and Lucille Roybal-Allard (Los
Angeles) are circulating a letter to the California Congressional
delegation on California's electric utilities deregulation
efforts.  The letter to Chairman Tom Bliley of the Commerce
Committee has already been signed by the following 39 members of
the delegation:  Reps. Jerry Lewis, Lucille Roybal-Allard, Howard
Berman, Brian Bilbray, George Brown, Ken Calvert, Walter Capps,
Gary Condit, Ron Dellums, Julian Dixon, Calvin Dooley, John
Doolittle, David Dreier, Anna Eshoo, Sam Farr, Vic Fazio, Elton
Gallegly, Jan Harman, Wally Herger, Steve Horn, Duncan Hunter, Jay
Kim, Zoe Lofgren, Robert Matsui, Howard "Buck" McKeon, Juanita
Millender-McDonald, George Miller, Ron Packard, Nancy Pelosi,
Richard Pombo, George Radanovich, Frank Riggs, James Rogan, Brad
Sherman, Ellen Tauscher, Bill Thomas, Esteban Torres, Henry
Waxman, and Lynn Woolsey.
     The letter points out that AB1890 provides for customer
choice in California to begin on January 1, 1998, and to be fully
implemented by 2002.  The bill ensures that all consumers will be
able to benefit from utility rate reductions resulting from
competition and will improve the reliability of service, advance,
environmental concerns, and ensure fiscal soundness.  The letter
goes on to support the decisions made in California on utility
restructuring and competition and calls on the Chairman to respect
the efforts California has taken and insure the opportunity to
fully implement AB1890 as Congress considers electric utility
restructuring from a national perspective.  
     Reps. Lewis and Roybal-Allard hope to have all 52 members of
the California House delegation sign the letter to Chairman
Bliley.  Those members who have not yet signed on should contact
either Jeff Shockey in Rep. Lewis' office at x55861, or Sherry
Greenberg in Rep. Roybal-Allard's office at x51766.

HOUSE JUDICIARY REPORTS PATENT REFORM BILL; LOFGREN PLANS BRIEFING
     On Wednesday, the House Judiciary Committee favorably
reported H.R. 400, the 21st Century Patent System Improvement Act. 
The bill, sponsored by Rep. Howard Coble (N.J.), Chairman of the
Courts and Intellectual Property Subcommittee, will bring U.S.
patent laws into harmony with other industrialized countries. 
Among other things, it will require that in most instances patent
applications will be published 18 months after the original filing
date.  This provision will allow U. S. companies to take advantage
of emerging technologies and eliminate the practice of submarine
patents (See Bulletin Vol. 4, No. 7).  The bill also converts the
U.S. Patent and Trademark Office into a government corporation and
ensures that all fees collected will be retained for use by the
PTO, rather than diverted to the general treasury.  The bill is
widely supported by the high technology industry.
     On a related note, Rep. Zoe Lofgren will host a briefing on
patent reform on Wednesday, March 19, from 3:00 to 5:00 p.m. in
Room 2105 Rayburn Building.  A groups of experts on patent reform
from the University of California, the American International
Patent Lawyers Association, the Intellectual Property Owners, as
well as high technology companies such as Hewlett-Packard, IBM,
and Intel will participate.  For further information contact Jason
Mahler in Rep. Lofgren's office at 225-3072.

INSTITUTE TO CO-SPONSOR IMMIGRATION BRIEFING
     In its continuing series of briefings on immigration issues
begun last year, the California Institute will co-sponsor a
briefing on "Immigration to California:  A Window on America's
Future" on Tuesday, March 25.  The briefing will be held in Room
2226 Rayburn Building from 1:30-3:00 p.m.
     Three experts on immigration issues will conduct the
briefing.  Hans Johnson of the Public Policy Institute of
California will discuss his recently released research on the
demographics of undocumented immigrants in California.  Prof.
Roger Waldinger of UCLA's Lewis Center for Regional Policy Studies
will address the ethnic transformation of Los Angeles, based on
his recent book, Ethnic Los Angeles.  Finally, Dr. William Frey of
the University of Michigan's Population Studies Center will
discuss immigration and the changing geography of poverty.
     The briefing is open to Congressional staff, the public, and
the press.  Please RSVP to the Population Resource Center at 202-467-5030.

GOVERNORS TESTIFY AGAINST MEDICAID PER CAPITA CAP
     On Wednesday, March 12, two members of the National
Governor's Association task force on Medicaid testified before the
Senate Finance Committee and criticized the proposal put forth by
the Clinton Administration and others to impose a "per capita cap"
on Medicaid.  A statement from Govs. Bob Miller (Nevada) and
Michael O. Leavitt (Utah) stated that per capita caps are
"unworkable" and that the cost shifting from a unilateral federal
cap would mean that states "would have to choose between cutting
back on payment rates to providers, eliminating optional benefits
provided to recipients, ending coverage for optional
beneficiaries, or coming up with additional state funds to absorb
100 percent of the cost of services."
     A per capita cap -- whereby each state's Medicaid receipts
per capita would be frozen at current levels -- favors states
which already provide rich levels of medical service to a narrow
range of patients.  Such states could simply expand coverage and
take in federal dollars at a high matching rate. California, is at
the other end of the spectrum, providing very cost-efficient
service to a wide range of patients.  According to GAO, California
ranks lowest among states in spending per patient, yet we are 6th
highest in breadth of patient coverage.  A Medicaid per capita cap
would permanently lock in the high federal receipts of freely-spending
states, and prejudice cost-conscious states such as
California.
     California Governor Pete Wilson was also in Washington this
week and expressed his displeasure with the per capita cap concept
at today's bipartisan delegation meeting (see article on page one).
     For a copy of the NGA testimony, contact the Institute at 202-546-3700.

ADMINISTRATION UNVEILS ISTEA / TRANSPORTATION INITIATIVES
     On Wednesday, the Administration announced its $175 billion
six-year transportation proposal.  Dubbed "NEXTEA" for National
Economic Crossroads Transportation Efficiency Act, the program
would raise surface transportation funding by $17 billion (11
percent) over the $157 billion authorized under ISTEA.  Safety
programs would increase by 25 percent, and clean air programs by
30 percent.
     The plan proposes a new funding formula that the
Administration claims would guarantee every state except
Massachusetts at least 95 percent of its average ISTEA
apportionments over the last six years.  (Massachusetts would
receive less because of the high distributions it has already
received for the Boston Central Artery Project.)  A full analysis
of the proposal is not yet complete.
     The proposal also calls for the establishment of a $600
million program to promote transportation alternatives for
commuting, including van pools and day-care centers at central
transportation stations; and increased funding opportunities for
intelligent transportation systems and smart vehicles.  For a copy
of the DOT proposal, please contact the Institute at 546-3700.

BOXER CO-HOSTS EAST-WEST INITIATIVE ON TECHNOLOGY
     On Wednesday, Senator Barbara Boxer co-hosted a seminar to
draw attention to the ever-increasing positive economic impact of
high-technology industries such as biotechnology,
telecommunications, computers and semiconductors, and
transportation.  Technology industries accounted for most of the
gains in the nation's manufacturing production in recent years,
and California, which out-paces the nation in average high
technology growth, is easily the nation's leading high tech state
with nearly one quarter of the nation's high tech sales and 20
percent of the nation's high tech workforce.  
     Last year, California was among the leaders in job growth
with more than 320,000 new jobs created, and, according to Senator
Boxer, nearly ninety percent of those jobs were created in the 
telecommunications, biotechnology, and high technology industries. 
Specifically, 29,000 new jobs were created in computer services,
and 15,000 in telecommunications.  The entertainment industry,
which is an increasingly important sector of the high technology
boom in California, added as many as 24,000 new jobs last year alone.
     California is the top recipient of high technology grants
from federal programs such as the Small Business Innovation
Research program (SBIR), NASA, and the National Institutes of
Health (NIH), National Science Foundation (NSF) and the National
Institutes of Standards and Technology (NIST).

BIOMEDICAL INDUSTRY HIGHLIGHTED AT FORUM; 1/3 OF BIOMED IS
CALIFORNIA-BASED
     A forum today put on by the Brookings Institution and the
American Enterprise Institute examined the impact of the
biomedical industry on the nation's economy and the field's future
given federal research budget constraints.
     One of the fastest growing sectors of California's high
technology industry has been the biomedical, pharmaceutical, and
medical sales industry, which now involves more than 800 companies
in the state and 65 university and private research institutions. 
     California's health-care technology industry now employs
165,000 persons, the second largest employer in the high tech
industry behind only aerospace.  In addition, a full 32 percent of
the nation's biotechnology companies and 28 percent of high tech
medical device firms are located in California.
     According to a 1994 annual survey of manufacturers, the sales
of medical instruments in California has nearly doubled since
1987, reaching a full $8 billion in shipments.

BART, AIRLINES REACH AGREEMENT ON SFO EXTENSION
     After a month of on-again/off-again negotiations between BART
and representatives of the airline industry to determine the exact
financing structure of the proposed BART rail extension into San
Francisco International Airport (SFO), an agreement has finally
been reached in which BART agreed to knock $8 million off of the
airport's share of the project's cost.
     All parties involved agreed that the new settlement would
likely clear any obstacles that have previously held up
Congressional approval of $750 million in federal funds for the
project.  The approval of the federal funds are key to the success
of the BART rail extension which BART hopes to have underway
within a year, and completed by the year 2000.

BIPARTISAN CALIFORNIA DELEGATION MEMBERS BRIEF CITY OFFICIALS
     On Tuesday, March 11, California Congressional delegation
chairs Jerry Lewis and Lucille Roybal-Allard co-hosted the first
of what was hoped will be many bipartisan delegation events during
the 105th Congress.  Lewis and Roybal-Allard addressed a breakfast
of more than 100 elected officials from California cities, who
then heard from Rep. Robert Matsui (Sacramento) regarding welfare
and tax issues, Rep. Steve Horn (Long Beach) on ISTEA changes,
Rep. Zoe Lofgren (San Jose) regarding crime, and Rep. Buck McKeon
(Santa Clarita) regarding job training issues.

DOE MOVES FORWARD WITH NATIONAL IGNITION FACILITY
     The Department of Energy announced Tuesday that it has
decided formally to go to the construction phase for the National
Ignition Facility.  Initial construction funds have already been
appropriated for FY97, but were withheld until this decision.  The
NIF will be a stadium-sized laser optics facility to be built at
Lawrence Livermore National Laboratory.  President Clinton's FY98
budget request contains $229 million for construction. 
Groundbreaking is anticipated in early April.

HUNTER SUBCOMMITTEE DISCUSSES ADDITIONAL B-2s
     At a Wednesday hearing of the House National Security
Subcommittee on Military Procurement, which is chaired by Rep.
Duncan Hunter (El Cajon), the panel considered a proposal to
direct the Pentagon to procure nine additional B-2 bombers beyond
the 21 already purchased.  California members of the subcommittee
making statements included Chairman Hunter, full committee Ranking
Member Ron Dellums (Oakland), Buck McKeon (Santa Clarita), and
Jane Harman (Rolling Hills).  Proponents of the plan estimated
that the nine additional aircraft would cost $9.3 billion, and
that $350 million would be required in FY98 to start the process
leading to a total of 30 planes by 2004.  The aircraft, produced
by California-based Northrop Grumman, is estimated to support more
than 20,000 California jobs.

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