Message from the Chair As a proud California State University graduate, I am dismayed to learn that Governor Brown’s January budget proposal for the CSU system falls $171 million short of the amount requested. Graduating nearly 100,000 diverse undergraduate students into hundreds of fields each year, the California State University system’s (CSU) 3.4 million alumni help sustain the state’s economy and ensure employers have the skills-ready graduates they need. Without additional funds from the Legislature, CSU campuses will have to make difficult decisions to cover financial obligations -- diminishing student access, success, limiting degree attainment and depriving California’s industries of skilled professionals. This will greatly impact the CSU’s ability to provide a much-needed quality education to those who need it the most. Time and again, we hear from our 500 chamber members regarding the need for more skilled workers and a better-educated workforce. There are jobs available, but without the right education, they will continue to go unfilled, drastically impacting our local economy and that of the state. While it is a good thing that thousands more students are meeting minimum CSU eligibility requirements, we need to ensure that they have a seat in the CSU. According to the Public Policy Institute of California, the state needs one million additional college graduates by 2030. The CSU is answering this call and is on track to graduate an additional half million students in the next decade! But without adequate funding, this simply will not happen. As Ventura County’s largest City and with an estimated 21.8% of Oxnard’s population living in poverty, we know all to well that obtaining an education is key to breaking the cycle of poverty and providing our community members with a better quality of life. We appreciate the support of our local State Senator Jackson and Assemblymember’s Irwin and Limon for the support of fully funding the CSU system and urgently request Governor Brown fully fund the CSU system. Ensuring that higher education is a top legislative budget priority, will continue to aid CSU’s in educating California’s next generation of workers. “Today knowledge has power. It controls access to opportunity and advancement” -Peter Drucker5/15/2018
MESSAGE FROM THE CHAIR OF THE BOARD “Today knowledge has power. It controls access to opportunity and advancement” -Peter Drucker It is my honor to serve as Chair of the Board for the Oxnard Chamber of Commerce. For 110 years, the Oxnard Chamber has served as a catalyst for business growth, as the convener for leaders and influencers, and the champion for stronger communities. Our team, in concert with our nearly 500 members, works to promote the business and economic well-being of our diverse community to benefit enterprises, big and small, through advocacy, services and education, business exposure, and promotional opportunities. Our main objectives are to: represent the interest of business with government; encourage a strong local economy; promote the community; advocate political action and provide promotional opportunities and networking for our members. One of my favorite programs offered by the Chamber is the Oxnard Leadership program. Growing local leaders to serve on boards, committees, and potentially serve as elected officials, is one of the most important tasks we as a community have. I’m proud of the high-quality leadership series our Chamber has developed and would encourage you to consider enrolling employees in this worthwhile program. Participants in the Oxnard Leadership program receive a comprehensive overview of the Oxnard area – its realities, opportunities and challenges. Sessions move to various locations throughout the Oxnard area and provide students with a unique opportunity to meet key business and government leaders who play integral roles in the region by way of tours, panels, and speakers. Class speakers address, not only the facts, but also perspectives, challenges, and opportunities in highly interactive sessions. (For more information, please call 805-983-6118 or email info@oxnardchamber.org) I would encourage you to reach out to me with any suggestions, questions or ideas you may have that would benefit our business community. I look forward to working with each of you in the months ahead. As we all know, the President signed the sweeping tax reform bill ushering in a broad range of changes including new rules for income tax rates and deductions, college for savings incentives, estate planning and corporate taxes. These new rules are leaving folks scratching their heads and scrambling to find out what the most sweeping tax reform package in decades means and what actions to consider. In my last article I wrote about the importance of passing on some of the benefits to increase employees’ salaries and 401K’s so I’ll continue in this article by saying that retirement savings incentives apparently will be unaffected. To get a clear understanding, everyone should consult with tax professionals to evaluate their personal circumstances and money management but financial advisers say the new rules do not call for changes to existing retirement savings incentives, preserving the favorable tax treatment and contribution limits to 401 (k)s and other retirement savings accounts. Below are some key takeaways from tax reform bill: Temporary increase in federal estate tax exemption The law will roughly double the federal estate tax exemption to $11 million per person ($22 million per couple). That limit will be indexed to inflation, but would expire and revert back to current law after 2025. Beneficiaries will still get a step up in basis, meaning there would be no capital gains tax due on inherited assets at the time of the transfer, and the cost basis - the value used to compute tax liability - would be reset to the price at that date. It is important to note that state level estate tax exemptions are often much lower than the federal level and are unaffected by this law. In addition, the temporary nature of the higher limit means that if you have an estate plan, you should proceed carefully before making any changes. While a further increase in the estate tax exemption will help some families avoid this tax at the federal level, it remains important for all households to have a current estate plan that helps ensure their wishes are carried out and reduces the cost of transferring assets as part of an estate. New corporate tax rate and pass-through tax rate Corporate tax rates will be cut to 21% beginning in this year. That tax cut is not scheduled to expire. Pass-through businesses, businesses structured as sole proprietorships, partnerships, and S-corporations, will be taxed at individual tax rates, but will be able to deduct 20% of income. To prevent high-income individuals from taking advantage of this deduction, it would only be available to couples filing jointly with incomes below $315,000. For income above that level, the rules are complex but it appears that certain kinds of businesses might still be eligible for a partial deduction. The plan would let businesses fully expense new equipment right away, but the provision would eventually expire. The bottom line There are a few things you may want to consider in light of the new legislation, and may want to consult with a tax professional about, so you can be prepared. • Rethink your mortgages and deductions: If you have traditionally made charitable gifts or benefited from the mortgage interest or state and local tax deduction, you want to look at how the new standard deduction will impact you. If it no longer makes sense to deduct these expenses, you may want to rethink your mortgage or giving strategy. The imposition of a cap on state and local tax deductions may also impact where some people choose to live in retirement. • Estate tax: Even in the absence of tax reform, it makes sense to periodically review your estate plan. If the estate tax limit changes are relevant to your plan, it may make even more sense to revisit your strategy. You may want to meet with your estate planning attorney. • Small-business income: If you own a small business, you may want to reconsider how you structure your income and the form of your enterprise. Depending on the size and particulars of your business, you may want to consider the benefits of incorporation or the restructuring of pass-through organizations. Consult with an expert in small-business taxation. • Timing corporate expenses: With new rules in place temporarily for expensing capital equipment purchases, business owners may want to review their capital expenditure plans. I trust the Oxnard business community will find this information useful. By Michael Wynn Song, Chair Here’s wishing all of you a happy, healthy and prosperous new year. As the incoming Chair I will work with the Board of Directors and the CEO to accomplish the goals we set at our planning session last year. The Oxnard Chamber will continue to work tirelessly to protect our business climate and ensure our continued economic prosperity, to strengthen our leadership program and to enhance the quality of life for all in our wonderful city. We hope our local representatives will follow our suggestions for promoting legislation that focuses on the issues most critical to achieving those goals. With the signature count complete a council recall is now slated for this spring, the saga of the current Oxnard City Council member recall and a district-based election drama continues. The Chamber has voiced our position on the recall and now we’ll have to wait and see how things pan out. Regardless of the outcome we will continue to work with the City Council and local leadership to enhance the business climate I would be remiss if I didn’t mention the record-high stock market surges that have many investors cheering the corporate tax cut. Hopefully those tax cuts can also boost California worker’s wages to not only attract the best and brightest workers, but retain those workers in an ever-challenging California business climate. With the demise of pensions we need good wages and benefits to keep good workers. As part of Hyundai Glovis management, I am proud to say that we continue to evaluate and adjust our employees wages upward and provide good benefits such as dental, medical and vision insurance and a 401(k) plan with matching funds. Stock market surges and corporate profits are good for business. Unemployment is going down but unless it equates to a better standard of living workers can’t be happy. California needs to prepare the workforce of tomorrow. I don't mean to sound facetious but it's a safe bet to say that of the 55 million Americans that purportedly have a 401(k), not many are complaining about the stock market surges this past year. Nonetheless, healthy inequality is an issue; those who own equities and real assets get richer but most ordinary folks struggle to stay ahead. While the affluent are making boatloads of money, on the opposite end of the spectrum it's a totally different story. People don't mind falling behind when everybody else does. To give an extreme point of view, I don't know how many of the baby boomers are 401(k) participants but purportedly, less than half save less than $100K by retirement. To make an extreme point, this past year the average return on a million dollar 401(k) is about $170K. The percentage is the same but the baby boomer's return on his $100K 401(k) is $17K. The millionaire can support his family and live comfortably for well over a year on his plentiful return while the baby boomer can't even buy a Hyundai Sonata. Being proactive in your efforts to improve the standard of living for our workforce will ultimately help the Oxnard business community to prosper and grow. This marks the last article I’ll write as Chair of the Board of Directors for the Oxnard Chamber of Commerce. This position has allowed me the great opportunity to focus on topics that I’m passionate about and express how they affect businesses and residents in our community. As I reflect on this past year and get ready to hand the gavel over to my esteemed colleague, Michael Wynn Song, to take over as Chair, I encourage the Oxnard Community to consider the following points to help businesses and the future economy in Oxnard:
Thank you to Nancy Lindholm, President and CEO of the Chamber, and her staff for attentively responding to the needs of our members and continuously advocating on our behalf. I also appreciate the time, energy and financial contributions made by our Board of Directors. They are truly committed to the Oxnard community. I’m honored to have served in this capacity this year and wish you all happy holidays and prosperous 2018. Last month, in celebration of “National Energy Awareness Month,” representatives from California Resources Corporation, Aera Energy, Oxnard College, LULAC and El Concilio presented at a Ventura County Board of Supervisors’ meeting the “Moment of Inspiration” where a “Careers in Energy” program was highlighted that recently took place at Oxnard College. We demonstrated first-hand how we are working with local private and public education, non-profits, governmental organizations, labor and others to introduce careers in the energy field. These careers run the gamut from engineers to geologists to helicopter pilots; all under the auspices of STEM which is science, technology, engineering and math curriculum. By working together, we aim to equip our youth with the tools they need to become the leaders of tomorrow. By designing career programs with our neighbors, communities and the environment in mind, we hope STEM education will help guide them as they lead the Golden State in meeting our growing energy needs in an economically responsible and environmentally sustainable way. Being socially conscious means recognizing the needs of our ethnically diverse communities. The opportunity to earn a solid paycheck without a four-year degree is being eliminated. However, one industry that is providing that much-needed economic mobility is the oil and gas industry. In fact, one-third of the industry’s workforce has a high school degree or less and an average annual wage of $84,000. The oil and gas industry supports an all-of-the-above energy approach which means safely developing our energy resources to support everything we do at home, work and play. We believe in having a fact-based and balanced conversation about the critical role that energy – all forms of energy – plays in every aspect of our society, economy and daily lives. “Careers in Energy” programs like this and other industry workforce opportunities focus to empower all our students in Ventura County. As I was surveying all the local progress to our economy while in one of Aspen Helicopters’ aircrafts on a recent Oxnard Chamber business visit, I couldn’t help feeling that this must be what it’s like to be a drone. At approximately 1,500 feet above the ground, we had an excellent aerial view of Oxnard’s impressive business growth and beautiful landscapes. Drones, officially called an Unmanned Aircraft System or a “UAS”, came onto the scene a few years ago rather quickly. You can purchase a drone online or in a store for as low as $49.99 or spend thousands of dollars with sophisticated added capabilities ranging from cameras to high definition live video. What you may not know is that there are rules, regulations and legislation being implemented just as fast as the newest drone models hits the market. According to the Federal Aviation Administration’s (FAA) Safety Briefing (May/June 2017), the following are guidelines that an owner of a UAS needs to adhere to even if you are flying your drone as a hobbyist:
Last year, the FAA released its Small Unmanned Aircraft System (sUAS) regulations with the new Title 14 Code of Federal Regulations (14 CFR) part 107. New owners of a drone should check the website at www.faa.gov/uas before launch. This will educate drone operators on whether they need a Remote Pilot certificate or not. For the legislative cycle that ended September 15, 2017, there was one additional drone-related bill passed by the legislature. AB 527 (Caballero) will make modest revisions to existing law regarding licensure requirements for those who operate pest control aircraft. If Governor Brown signs AB 527 by October 15, any person operating an unmanned aircraft for pest control will need to be certified to do so by the California Department of Health. It will require additional training and expertise than is currently mandated. If you are using a drone for pleasure or business-related activities, make sure you follow all UAS requirements to avoid fines and penalties that can add up to more than the cost of the new toy. Many of you have heard me mention an “All-of-the-Above” energy portfolio as I speak about my company, California Resources Corporation, and the oil and natural gas industry. That means safely developing all our energy resources – from renewables to oil and natural gas – to support everything we do at home and at work. Just like you diversify your financial investments to maximize the return, a comprehensive energy strategy is needed to ensure that our huge demand for power is met with ample reliable, affordable and secure energy – an assortment of energy sources that includes fossil fuels, solar, wind and other means. An example of how energy diversification works was demonstrated during the eclipse that occurred on August 21st. An article was recently published by Energy In Depth, a research, education and public outreach organization, which described how grids throughout the country remained functional. The following is an excerpt from that article: Solar Eclipse Causes No Electrical Grid Issues, Thanks to Natural Gas Originally Published by Energy in Depth Solar companies and grid operators across the country spent ample time planning for last week’s solar eclipse, particularly in California and North Carolina, which dominate the country in solar output. Those efforts paid off, as consumers faced no issues, even as solar output was cut in half in California, dropping from 6,000 megawatts (MW) to 3,000 MW, and North Carolina lost 1,700 MW, due to the eclipse having totality in some locations. How did they keep the lights and air conditioning on for consumers? As Neal Kirby, spokesman for the Independent Petroleum Association of America tweeted, it was thanks to alternative energy sources like natural gas. In California, natural gas and hydropower were used to offset the extreme drop in solar. The U.S. grid’s performance is a testament to how far the solar industry has come in recent years, and to the grid operators’ ability to manage system reliability. But the real takeaway is that despite the oft-repeated activist line that the U.S. grid can run solely on renewables without traditional energy sources, an energy mix including fossil fuels is still needed on a daily basis. Americans might not see a total eclipse every day – and won’t again until 2024 – but frequent fluctuations in power from the sun and wind are very real. The eclipse put the grid in the spotlight, but the challenges the country was monitoring are issues backup sources like natural gas help mitigate on a daily basis. As Stephen Berberich, the president of California’s grid operator California ISO, told Fortune recently, natural gas will continue to be an important part of the state’s backup energy supply for renewables: “The ‘electric grid of tomorrow’ will increasingly have to deal with fluctuating power supplies from the wind and sun while incorporating quick-start gas turbines during events like the upcoming eclipse.” As natural gas and renewables increase the percentages of power they supply the grid, it is becoming even more apparent that these energy sources are complementary and will be an important and significant part of the future energy mix. To read the full article, please click here: https://energyindepth.org/national/solar-eclipse-causes-no-electrical-grid-issues-thanks-natural-gas/ When your business has an issue that you cannot solve on your own, who do you call? Of course, it depends on the subject matter, but chances are, your Oxnard Chamber membership is a direct line for assistance and the appropriate resources. Many companies join or renew their membership and forget to utilize the chamber benefits. Some businesses use their membership to increase their sales of goods or services, or for networking, or to learn more about new business laws and regulations. Nevertheless, having a business advocate organization working on your behalf can prove that your Oxnard Chamber membership provides a significant return on your investment. The Oxnard Chamber Business Advocacy Committee (BAC) meets the second Monday of every month at noon at the Oxnard Chamber office. Led by Oxnard Chamber board members Tom Cady and Stacy Miller, the committee meets on proposed legislation, local elections and measures, and other issues such as energy, transportation, land use and water. The BAC is open and transparent and often has legislative aides in attendance, as well as the City and County representatives. Once an agenda item has been vetted and voted on through the BAC, it is then forwarded to the full Oxnard Chamber Board of Directors as an “Action Item” at the next scheduled board meeting. As chair of the board of directors I’m repeatedly impressed by those around the table who represent a myriad of industries in the Oxnard community and contribute to a thoughtful and methodical discussion on any particular item. Additionally, it is not uncommon for Nancy Lindholm, President & CEO, and Oxnard Chamber board members to spend hours at a city council or county board of supervisors’ meeting on your behalf. Moreover, we’ve also taken several trips to Sacramento to express our positions on a variety of topics. There are residents and other organizations who have strong opinions on local issues, however advocating for a member in good standing and whose business benefits the community is a roll the Chamber is proud to take on. It’s reassuring to know that the Oxnard Chamber is your business advocate. Now, who are you going to call? Last month, the Los Angeles County Economic Development Corporation (LAEDC) released its most recent study that revealed the economic impact the oil and gas industry has on the state. The LAEDC conducted this analysis using 2015 data from the oil and gas industry as a whole. The bottom line is that the oil and gas industry makes a significant contribution to California’s economy. Even more interesting are the characteristics of the workforce that the oil and gas industry employs which is in some aspect reflective of the demographics of our state. Some of the highlighted trends include:
The LAEDC’s study also brought to light the industry’s impact on regional economies throughout California, including valuable tax revenues by county. In Ventura County, the analysis calculated a total of $306.6 million in state and local taxes and a sum of $216.7 million in federal tax revenues. This is revenue that can be used by local government to provide critical services to residents of the county. Total jobs for our area in the oil and gas industry were nearly 6,000 which included direct, indirect, and induced employment. Examples of some of these jobs the industry provides include engineers, information technology specialists, electronics technicians, and geologists. Allan Zaremberg, California Chamber of Commerce president and CEO stated, “California’s oil and gas industry has been an engine of California’s growth for more than 100 years. The industry sustains tens of thousands of well-paid middle class jobs, provides hundreds of millions of tax dollars for the support of state and local government, and provides the energy and much of the innovation that powers our economy.” To read the entire study or download it, go to http://laedc.org/2017/06/08/oil-gas/. A Message from our Chair To quote the proverbial British rock band Queen, We are the champions! The Oxnard Chamber of Commerce and its member companies were recognized this month for supporting business and education. Already recognized for its strong leadership, board representation and associates, the Oxnard Chamber has now established itself as an award-winning advocate organization for steering youth towards workforce readiness. On May 18th, the Chamber was presented with the Oxnard Union High School District’s (OUHSD) “Business Champion” award at a program presented by the OUHSD – Office of Career Education, OUHSD Academies and the Ventura County Civic Alliance for its “Direct Path to Success” program led by the chamber’s own Director of Workforce Development, Jim Rose. The program has served over 1,100 high school students by providing workshops, internships, and other business interfaces with the different academies. Interestingly enough, many of the other organizations and individuals honored for being essential business partners during the same event had a direct link to the Oxnard Chamber. They included Oxnard Chamber board members Laura Mullen (DCH Auto Group), and Cynthia Herrera (Oxnard College); Dignity Health represented by Sharon Jones, Cal State Channel Islands represented by Manuel Correia, and Friends of the Channel Islands Harbor represented by Steve Kinney. In addition, my employer, California Resources Corporation was also included in the festivities by receiving the “2017 Business Champion Award” from the Oxnard Chamber’s Workforce Education Readiness Committee. On May 31st, the Oxnard Chamber of Commerce was one of 29 chambers in the state to receive the 2017 California Chamber of Commerce “President’s Circle Award”. This was not by luck of the draw, but rather for fulfilling numerous requirements that Cal Chamber established as mandatory criteria. And, this criteria must be met annually. I would be remiss if I did not mention my fellow board member, Michael Wynn-Song. He was one of three awardees recognized for being a relentless “Small Business Advocate” by Cal Chamber President and CEO, Allan Zaramberg. Michael has spent countless hours at Oxnard City Council Meetings and other chamber functions stressing the value of business in the Oxnard Community. And most recently, the Oxnard Chamber of Commerce was the recipient of the “2017 Youth Opportunity Award” presented by the local Workforce Development Board. This honor was bestowed on the Chamber for providing career awareness opportunities and internships that are designed to grow and strengthen Ventura County’s future workforce. As the Oxnard Chamber of Commerce celebrates its achievements this month, let it be a reminder that we are here to serve our business and education community. By the looks of all, the plaques and trophies collected this month reaffirms we are doing just that. |