June 1, 2003 - From the June, 2003 issue

Fred Keeley Assumes Leadership Of Planning And Conservation League

For many, the Planning and Conservation League is synonmous with its recently retired executive director Jerry Meral. Meral grew the organization into one of the more powerful issue-based nonprofits in Sacramento through deft legislative politicking and the use of the initiative process. PCL's new leader is a stranger neither to politics nor to the legislative process. Fred Keeley takes over the helm at PCL after a career in local politics as a county supervisor and in state politics as a leader in the Assembly. TPR is pleased to present this interview with Fred Keeley, in which he charts his path as the new Executive Director of the PCL and the PCL Foundation.


Fred Keeley

Fred, what enticed you to assume the leadership of PCL?

Essentially what attracted me to PCL were three things. The first is my passion for and interest in the environment of the state of California in all of its manifestations. Second is my passion to work on environmental policy and social justice policy, which is what made me to want to run for the Assembly in 1996. To some extent, I feel as if being executive director of the Planning and Conservation League is an opportunity to continue the work I started in the Legislature.

Third, PCL and the foundation are venerable environmental organizations with a very long and proud history. The opportunity to step in, stand on Jerry's shoulders and the work that he and so many other fine people have done over the years, and to have the chance to make some very significant changes and lead them were very attractive to me. Together with the board of directors and the staff, I look forward to leading an effort to make sure this is a very contemporary, relevant and preeminent environmental organization.

Elaborate for our readers, after six months on the job, the prioritized agenda you are crafting for PCL?

Well, PCL was founded in 1965, 37 years ago. First and foremost, my goal is to be certain that this organization will be here 37 years from now. And that is not as easy as it sounds. California is growing at an enormous pace and the demographics are changing very rapidly. When we take the census in seven years, there will be a majority Latino population. One of the challenges for the environmental movement generally, and for all environmental organizations in particular, is to be relevant to the emerging Latino majority in California. And, that will require environmental organizations to think and work and act in ways that are different than today.

Specifically, much of the work of environmental organizations in the future is going to need to be directly identified with and connected to health issues. When we work on air quality, for example, we need to make sure we are working on it from the perspective of childhood asthma as well as other public health considerations. When we're working on water quality, we need to work on it in terms of the water quality of streams and creeks and rivers and public water supplies as well as beaches in urban areas of California. When we work on any issue of an environmental nature, we need to make a direct connection between that environmental issue and the health of Californians.

Our focus must shift from one that deals with wide-open beautiful spaces -- that we should continue to preserve and protect and defend -- and we also need to move our focus to where people live their daily lives. For a great many Californians, that's in a densely urban and suburban environment that needs an awful lot of environmental attention.

Jerry Meral led a very productive, but contentious, set of referenda and initiatives that generated a lot of funding for infrastructure investment and open space protection over the years. Many of those measures were in contest with the Legislature, the latest of which was Prop 51. Are you suggesting that PCL under your guidance will have a different orientation than did Jerry's PCL?

We are going to focus on our core competencies: legislative advocacy, environmental research and community building though workshops and publications. As someone who has spent my professional career in the legislative arena, I am someone who actually does believe in the legislative process. We should use all of the tools available to us as citizens of the state of California to shape policy.

I'm very proud of the record that I established in the California Legislature where I authored the two largest park and environmental protection bonds in the nation's history. In 24 months from March of 2000 to March of 2002, the voters of the State of California approved 4.7 billion dollars of general obligation bonds for parks and environmental protection in California. And I know that that process can work and I know that it can work well and it can serve California well. So my first choice as the Executive Director of this organization is to use the legislative process when it comes to forming capital to achieve environmental protection and enhancement goals.

Should that fail, however, I am not averse to the notion of putting together a coalition that can put measures before the voters if they are appropriately designed and the campaigns are appropriately conducted. I did not support Proposition 51 and that was, of course, before I became the Executive Director. Jerry did a lot of very, very good work and there's a strong body of opinion on both sides of whether or not Proposition 51 was good for the state. The voters didn't think so and they didn't adopt it. But from where I sit now, it's important for us to forswear the initiative process in the '04 election cycle. We must return to our core competencies; build an internal team that is the best team we can possibly put on the field; and re-position PCL to be effective in the new California. Those are big enough challenges for us to undertake and I don't think we need to confuse those tasks by trying to seek out a position on the ballot through the initiative process.

There's a growing sense, given the budget deficit and frustration with reaching a balanced budget, that the state capital is not only broke, but also broken. Because of a confluence of forces, whether it is 25 years of Prop. 13 or the lack of an open primary or reapportionment, the state government appears no longer to have either a direct relationship with the private economy or ability given the current governance structure to avoid partisan paralysis. Does this observation ring true to you and your environmental colleagues? If so, what's the cause of this disconnect and political gridlock?

I think it's a fair statement to say that the legislative process today in California has enormous challenges facing it. Particularly with the budget, there are structural changes that are easy to identify, difficult to change, but are absolutely necessary for California to be a governable state.

Why don't you elaborate?

Well, there are essentially four major issues in budgeting. First, there is the issue of the tremendous volatility in the sources of the general fund. The general fund consists of two major sources: the personal income tax, which includes capital gains, and the state share of sales tax. There's also a small portion of the general fund that consists of the bank and corporation tax and it's a very stable source of revenue. The personal income tax, especially with the capital gains portion, and the state sales tax tend to outperform the economy when it's doing well and underperform the economy when it's doing poorly. As a consequence, there's tremendous volatility.

Taking the volatility out of those general fund sources is critically important and there are plenty of ways to go about it. One strategy would be to put together a statute that would broaden the application of the sales tax to include services. It is possible to incrementally, year by year, include more and more services in the state sales tax and reduce the overall state sales tax rate. We could accomplish this by baking a larger pie, which would bring more money into the state coffers.

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You could take a similar approach with the state income tax. It may be possible to impose a very, very small state income tax on everyone in California and actually raise the upper personal income tax, removing some of the volatility from that source. Both of the reforms I've just mentioned about sales tax and personal income tax will not make everybody happy. But, what makes people less happy is going form boom to bust, boom to bust, boom to bust and not being able to plan for a state that is growing at a pace of 500,000 people a year.

Second, the two-thirds vote requirement to get a state budget creates a significant roadblock. That should be lowered to something less than two-thirds. I know that it is probably not politically palatable or achievable to make it a simple majority vote, but it is absolutely essential. Such a move would require the majority party to be responsible for governing and budgeting. If you're going to give people the responsibility, they need the authority. If you're going to give them the authority, they need the responsibility. And I think that's an important change.

Third, there is the issue of ballot-box budgeting. Fully two-thirds of the state budget is locked up before any governor or any legislator makes a single decision on the budget. This stems from initiatives passed by the voters. For example, last year when we had a $28 billion deficit, state spending on education went up. Nobody is going to argue that that is a bad idea. But, there is no correlation between the health of the general fund and spending on K-12 education. Maybe there should be so that the rest of the areas of the budget aren't hammered disproportionately because we have protected one area completely. That's not a popular notion, but it doesn't mean that the outcome of that discussion is that education fares less well in the budget. It does mean that if we're grownups and if we're going to take on the issue of how to put a budget together in California and how to govern this state, we have to take some of these things off of automatic pilot and wrestle around with the real choices that we have.

Lastly, the state's policy regarding tax credits should be addressed. Revenue and taxation code is littered with dozens and dozens of tax credits that were enacted at various times over the history of the state, all with good intentions. And, there is virtually no sunsetting of those provisions, no reviewing to see if those tax credits are achieving their stated economic or social purpose. Tax credits are expenditures in the budget every bit as significant as spending on education or on the environment or on transportation -- except, there is no line item for them. The difference between a tax deduction and a tax credit is all the difference in the world. A tax credit is a budget expenditure. Yet, there is no line item for it anywhere and it is worth billions and billions of dollars.

And so those are four areas that are ripe for a grownup and mature conversation if we're serious about having a governable state.

Fred, your last comment -- if we're adults we need to have a serious adult conversation -- echos what many commentators are asserting: because of the partisanship of politics in the capitol and the architecture of our government today, no such adult discussions are taking place. Our governance system, it is argued,, is not only broke, but broken. What structural reforms ought to be to be advanced to facilitate thoughtful, constructive, adult conversation in the Capitol about California's needs and budget?

Well, in order to have that conversation, the powers that be in California all need to be part of the conversation. Any relatively small combination of interests can stop anything from happening in this state. So, if the business community feels it's not at the table when reforming Prop. 13 is being discussed, then they are certainly not going to be supporting a package. If the education community is not at the table when there's a discussion about Prop. 98, then they're certainly going to be able to derail everything. But, it's important to have that conversation in California and it should be done in a variety of ways.

I hope that the current governor and future governors will insist on having that conversation with Californians by going on statewide television, by traveling though the state, and by treating Californians as if they can handle large complex issues -- because, frankly, they can. I believe that if you treat people respectfully and as intelligent adults who can handle complex issues and you take this conversation out there, people will respond to it very well.

Fred, If there is a govenatorial recall election this fall, will that take off the table for this year the possibility of a thoughtful statewide reform conversation?

Well, you know let me just respond to that. Those who don't want to have the conversation will always have a reason not to have it. It either is an election year or it's not an election year. It is either because there is a recall that might qualify for the ballot or there's presidential primary happening. Or, there is another kind of crisis that's too important, like the energy crisis, and you can't have too many issues out there. There will always be a reason.

We aren't going to have a day where the sun comes up and birds are chirping and everything's fine. This is not Lake Wobegon, this is California for god's sake and there's no better time for reform than right now. With the politically charged atmosphere, the fact that the state is wrestling with this enormous budget crisis, the fact that there is a recall effort afoot, the fact that Californians are paying attention at some level to public policy and politics right now is exactly the time to have the conversation.

In closing, what should our readers look for from PCL in the coming year? What should the environmental conversation be about? What ought to be the benchmarks to measure both PCL's and your success?

We have three benchmarks for success. Number one, we want to reshape the discussion about the environment in California so that it is a much more relevant conversation between the environmental community and the emerging communities of color and the Latino majority in California. Have we been able to engage and sustain that conversation in California?

Number two is whether or not this organization is able to return to its core competencies in terms of legislation, research and community building. And lastly, it is going to be whether those three words "Planning Conservation League" are meaningful and authentic. Our actions during the preceding 12 months should have caused people to look at us again and to be excited about and intrigued by the work that we're doing.

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