Thursday, September 29, 2011

Media Release: CA Ranked in 'Top 10 Best States To Do Business'/ Alternate Energy

We always hear talk about California being a bad place to do business. Well in one survey, California was ranked around 50th out of 50 states, which is just one ahead of Washington DC (who ranked 51st). Then, I see another report (below) that ranked California as being the top 10 states to do business. I don’t believe this just as much as I don’t believe we are 50th.

Ultimately, you need to look closely at the questions being asked.

If the questions revolve around regulations, taxes and cost of housing, California is going to end up on the bottom. If the questions revolve around climate, quality of life, entrepreneurism and R&D and our university system, California will come up at the top. I point this out so you are cautious when you hear the results of surveys ranking California’s business climate.

I also want to send a thank you all of you that responded to my question on alternate energy and solar. Naturally, the responses varied from strong support to “let the market decide”. However, the most common response was that we need to find ways to get off our dependency on oil and develop a long term strategy, which takes into account all alternate energy sources (including solar). Most of you said that the Solyndra situation was tragic, but it is just one loan. Many of you also pointed out that gasoline has been subsidized for years.

Wednesday, September 28, 2011 (916) 322-0667

Governor’s Office of Economic Development Announces California Ranked in ‘Top 10 Best States to Do Business’

Sacramento Calif. – Governor’s Office of Economic Development Director Joel Ayala today said that Area Development magazine has ranked California as one of the top 10 best states to do business. The rankings are based on a nationwide survey of highly respected business location consultants.

“Despite all the negative rhetoric, the fact remains California is still the nationwide leader in high-tech, biotech, green, venture capital and agricultural job creation,” said Director Ayala. “California is also being recognized for its robust international trade activities which account for billions of dollars in revenue and contribute millions of jobs to the state.”

Area Development magazine noted that despite California being hit hard by the recession, California remains a global leader in international trade and access to global markets. In addition to California’s international trade advantages, Area Development noted that California is finding success through the state Innovation Hub (iHub) initiative which is administered by the California Governor’s Office of Economic Development (GoED).

The iHub initiative includes 12 state designated Innovation Hubs from Redding to San Diego which leverage assets such as research parks, technology incubators, universities, and federal laboratories to provide an innovation platform for startup companies, economic development organizations, business groups, and venture capitalists.

“The California iHub initiative is the largest state innovation program of its kind,” said GoED Deputy Director for Innovation and Emerging Technology, Louis Stewart. “The initiative began in 2010 with a small group and has since grown to an expansive statewide network of public and private partners focused on the commercialization of new products.”

The Governor’s Office of Economic Development (GoED) is the state’s the One-Stop-Shop for business retention and job creation. They offer a wide range of services that are targeted to business owners including: site selection, business incentives, permit streamlining, clearing regulatory hurdles, small business assistance, and more.

To learn more about GoED and the Innovation Hub Initiative:

For the complete Area Development Magazine rankings,

Wednesday, September 28, 2011

Alternative Energy/ Small Business Survey/ Invitation to Luncheon Oct 20

With the Solyndra debacle fresh in our minds and the solar industry coming under fire, I am curious how the small business community views the industry. Do you think it has been hyped as a job creator and the energy savings from solar have been overstated? Or do you think the alternative energy industry (specifically solar) is a necessity for US economy?
Again, I ask all of you to please complete the small business survey for the event Small Business California is doing with the Travelers Institute on October 20th. (Survey link is below)

It takes about five minutes. I will also be sending the results to Mike Rossi, the economic development Czar for the Governor. Thank you to all that have already taken the survey. We really appreciate your time and opinions.
I know that this email goes around the state but anyone interested in attending the luncheon Oct 20th is welcome to attend. I think we will reach capacity so I encourage you to register now. (Link to register is below)

There is no cost to attending this event and the panel for the event will include myself and:

- Marc Schmittlein, President and CEO of Travelers Select Accounts
- Christine Baker, Acting Director of the Department of Industrial Relations
- Elizabeth Echols, Regional Administrator SBA
- Regina Dick Endrizzi Director, SF Office of Small Business

Scott Hauge
Small Business California
2311 Taraval Street
San Francisco, CA 94116

Thursday, September 22, 2011

Health Insurance

Some amazing things are happening in the world of health insurance! Yesterday, I found out that my company, Cal Insurance, is getting a refund of 1.2% because Kaiser has put forth a policy of reducing rates 1.2% on policies that have renewed on or after July 1. I have also been told that Blue Shield is doing refunds as well. Policies with a lot of carriers are seeing single digit increases for the first time in years.

I am not sure the reason for this except that it may be the health legislation passed in March of 2010 that provided more oversight of health insurance carriers and it could also be that health insurance companies are taking a more active role in cost management. Have you seen these reductions?

As you know Small Business California surveys small businesses around the state to determine what are their most important issue. The cost of health insurance and availability of health insurance to sole proprietors has been the top issue for seven years running.

To see our survey go to

Scott Hauge
Small Business California
2311 Taraval Street
San Francisco, CA 94116

Wednesday, September 21, 2011

Small Business Survey

On October 20, Travelers Institute and Small Business California will be hosting a symposia to identify challenges facing small business. It will be at the Julia Morgan Ballroom in SF from 11:30 to 1:30pm. The panel for the event will include myself and the following:

- Marc Schmittlein, President and CEO of Travelers Select Accounts
- Christine Baker, Acting Director of the Department of Industrial Relations
- Elizabeth Echols, Regional Administrator SBA
- Regina Dick Endrizzi Director SF Office of Small Business

In preparation for the meeting could you take a few minutes and complete a Small Business Survey. See link below.

If you would like to attend the event please let me know by return email and I will send you invitation.

Scott Hauge
Small Business California
2311 Taraval Street
San Francisco, CA 94116

Monday, September 19, 2011

Senator Landrieu Comments on Appropriations Bill Funding for Small Business Administration/ Mike Rossi/ SB Cal

Please see below press release from the US Senate Committee on Small Business and Entrepreneurship indicating that the Committee approved a bill giving the SBA $955 million in FY 2012. See details below.

Last Friday Lori and I met with Mike Rossi the Economic Development Czar for Governor Brown. It was an extraordinary meeting and I left with the expectation that we have a real good friend who is a straight shooter and very interested in helping California Small businesses. I think I can safely say he is a no nonsense person and is looking for concrete ideas that are doable. He wants to help us with On Bill Financing and was interested in learning more about our proposal to permit unrestricted general solicitation for offerings up to $1 million annually as long as all of the
investors are accredited investors. This is sanctioned by the SEC under Rule 504 which requires a state enabling statute.

Small Business California is looking for ways to increase revenue. For those of you that are members thank you but we need more of you to join so that we can pay our lobbyist Lori Kammerer and cover our ongoing expenses. None of our Board members including me do not receive any money from Small Business California and in fact some of us make large financial contributions. You can join by going to

We are also considering charging people who are not members a fee for these emails. I hope you will agree that there are few if any organizations that provide this kind of information to small businesses. throughout the year. Do these emails have value to you. are considering $75 a year. What are your thoughts on this?


September 16, 2011
Contact: Elle Ourso, (202) 224-5175

U.S. Senate Appropriations Full Committee Mark-Up appropriates $955.3 million to the SBA for Fiscal Year 2012.

WASHINGTON – United States Senate Committee on Small Business and Entrepreneurship Chair Mary L. Landrieu, D-La., today commented on the Senate Fiscal Year 2012 appropriations approved for the Small Business Administration (SBA). The committee- approved bill will give the SBA $955.3 million for Fiscal Year 2012.

“I think the small business community should feel good about the FY2012 funding approved yesterday in the Appropriations Committee for the SBA,” Senator Landrieu said. “Members on both sides of the aisle were able to come together and find the resources to fully fund the SBA’s two largest small business loan programs. We were able to protect the funding for contracting and counseling, and also to restore necessary operating funds to the SBA’s disaster loan program. I realize everyone would have liked an increase, and I personally wanted more for the SCORE program to leverage that volunteer counseling, but this is a strong level given the environment of cuts, and I think we will be able to give entrepreneurs the necessary tools to start a business, manage an existing one, or even grow and prosper in FY2012 with this funding.”

Highlights of the Financial Services Fiscal Year Appropriations for the SBA are as follows:

- Increases funding for 7(a) and 504 loans from $80 million in 2011 to $211.6 million for 2012, leveraging about $25 billion in loans, without raising fees.
- Protects SBA’s core counseling and contracting assistance programs from cuts by providing matching 2011 levels.
- Fully funds SBA’s Disaster loan program’s administrative funds at $167 million and protects the loan dollars so that SBA has the money and staff necessary to respond quickly when disaster strikes businesses or homeowners.
- Provides $2 million for the SBIR Federal and State Technology Program to help small, high-technology firms better compete for the billions in Federal research and development projects and transition technology that might otherwise die on lab shelves or in an entrepreneurs’ garage.

Wednesday, September 14, 2011

President Obama

The Board of Small Business California will be meeting tomorrow and discussing President Obama’s Jobs proposal. What are your thoughts? Will it encourage you to hire a new employee or hold off releasing employees?

I assume most of you are aware that Speaker Perez bill AB 29 passed and is now on the Governor’s desk. This bill creates the Office of Business and Economic Development. I have been told the funding for the office is $800000. Seems like a very small amount for an economy that is the 8th largest in the world and compares unfavorably with Ohio’s that has a budget of over 14 million . Small Business California strongly supported this bill and testified in committee and while it appears to be underfunded we still feel it is important that California have this Office.

Scott Hauge
Small Business California
2311 Taraval Street
San Francisco, CA 94116

State Bank/ Legislative Session

Please see email sent to Tom Campbell on AB 750. Small Business California has not taken a position on this and will discuss at our next Board meeting this week. What are your thoughts on a state bank. Is this a good idea and will it help small business or do you see this as another intrusion by government into the private sector?

The California legislative session closed late Friday night and bills that have passed both the Assembly and Senate now go to the Governor. He has 30 days to sign or veto.
Of note AB 29 passed creating the Office of Small Business Development. Also AB155 the Amazon bill was amended to delay collection of sales taxes by On Line out of state retailers until September 2012. The goal is to get a National policy of out of state On Line companies collecting sales tax for each state which would replace the California provision.

In President Obama’s speech he talked about reforming regulations in the Capital markets which would help small businesses. Small Business California’s capital access committee is working hard on this and looking to develop a policy proposal which would establish a small and medium size business Self Regulatory Organization to meet the needs of small and medium size business not just Wall Street. The President’s speech was encouraging showing his interest in addressing this problem.

(I am also including an email below from Michael Sauvante, Executive Director of the COMMONWEALTH GROUP for reference)

Scott Huge
Small Business California

I have some news for you on a parallel front with respect to our SRO concept. It concerns a topic I was deeply involved in before I shifted focus to small business capital markets and securities regulations, as you will note at the end of this message from all the writing I did on the following topic.

In this case it concerns the idea of the state (of CA) forming its own bank (based on a North Dakota model) to address credit issues here in California. 14 or so states are now looking into this idea.

With respect to California, Assembly Bill AB 750* was introduced to authorize a group to study the idea. In spite of some original questions about it, recent momentum built unexpectedly quickly for the bill and AB750 not only came out of committee, but it has already been passed by both houses with strong bi-partisan support, and it is off to the governor for signature (who may need encouragement to sign it).

I am sending a copy of this message to Scott Hauge as well, as I believe it would be beneficial to get the SB Cal network involved and have the California small business community encourage the governor to sign it. Here is a link to do so.

The core of this bill is to authorize a blue-ribbon task force to investigate and study the pros and cons of the state of California establishing its own state owned bank, replicating the model of North Dakota. For over 80 years now, the Bank of North Dakota (BND) has served as a mini-Fed to that state and its community banks. It is noteworthy to point out that North Dakota has the healthiest economy in the country by far, and the only variable that can reasonably account for that (as compared to every state with similar economic conditions as North Dakota’s) is the presence of the state bank.

Here are two relevant articles on BND and how California might benefit from following their example.

“North Dakota’s Economic “Miracle”—It’s Not Oil” (which lays out the premise for a state owned bank and its economic benefit to the state) and “What a Public Bank Could Mean for California” (which talks about the above AB750 bill and applies the Bank of North Dakota model to California and why it would be beneficial to California and it economy).

Both of these articles were written by Ellen Brown, the nation’s chief proponent of public banking, like that demonstrated by North Dakota. She is the author of Web Of Debt and numerous articles about public banking. Ellen is also the Chairman and President of the Public Banking Institute, which is leading the effort to promote the concept of public banking here in the United States. I am on their advisory committee.

Tom, you will note in the first article that it makes reference to writings on this topic by one of your own Chapman University Law School professors, Prof. Tim Canova. Here is an article he wrote on the topic: The Public Option: The Case for Parallel Public Banking Institutions. I am sending him a copy of this message, as he may well also like to know about the SRO concept that we have discussed. If you are so inclined, perhaps he might like your thoughts on the merits of the SRO project.

It may also be of interest to you both that the PBI website contains a page that addresses a number of common misperceptions about the idea of publicly owned banks, including the common one that somehow such a bank would compete with private banks. With respect to the later assumption, the reality in North Dakota is that there “is a very strong public-private partnership that increases the profitability and stability of the local community banks”. Those common misperceptions and responses to them can be found here.

Finally, if you would like to explore more ideas on this whole concept of public banking (i.e. banks owned for public benefit by either government entities or non-profit organizations, or hybrids of both) see this section on my website entitled “An Evolution in Banking”.

As you will note from some of those writings, this idea is not limited to states. Counties might also jump on the idea and in fact, we have a group here in Santa Barbara county that is exploring the prospects of introducing that idea here in Santa Barbara County. We’re having a strategy meeting in Santa Maria this Monday to discuss it. I will keep you posted on the results.

Here are some relevant links to California’s bill. All AB750 documents and history can be found here:

Thanks and best regards,

Michael Sauvante
Executive Director


650-641-1246 office
805-757-1085 cell
Skype: michael.sauvante
info on securities regulations:

Thursday, September 08, 2011

Retirement Plans/IBM Computer Equipment

On September 30th, I will be part of a panel discussing small business retirement plans. There will be a discussion of the state sponsoring retirement savings plans for the private sector. I will be addressing the questions below:

“What are the barriers that make it difficult for you, as a small business, to offer a retirement plan to your employees?”

If the State of California were to sponsor a retirement savings plan for private sector workers whose employer does not offer a plan -- with no cost to taxpayers and low or no fees charged to employers -- would you be willing to participate by enrolling your employees and implementing payroll deduction? What plan features would be important to you as an employer?

I would like your comments if you are not currently providing a retirement Plan. IBM will be announcing today a program to provide $1 billion to small and medium size businesses for computer equipment. This will be in the form of loans but IBM is indicating that they will be much easier to obtain than through a bank. For more information go to:

It is interesting that in the article it says small and medium size businesses purchase $250 billion of computer equipment a year.

Scott Hauge
CAL Insurance and Associates,Inc.
2311 Taraval Street
San Francisco,CA 94116
"Always looking out for you"

Tuesday, September 06, 2011

Obama's Speech on Economy and Job Creation & UPDATE

Thursday President Obama is going to give a major speech on the economy and job creation. I have been asked by a reporter from a syndicated columnist from the Business Journals about inputs from small business owners and experts for a preview of Obama ‘s jobs speech on Thursday.

The question was posed as “What do you want to hear President Obama say on Thursday night to address the nation’s persistently bad jobs picture?”

I need to get back to him Wednesday morning so if you have thoughts please respond today.

UPDATE >>>>>>>>>>>>

Thank you to all of you that responded to my question about what you would like to hear the President say in his speech. I received 175 responses. The most frequently cited comments were:
- To end the political stalemate between Republican and Democrats.
- You want the Government to get out of the way.
- A review of current lending policy which has stifled bank lending to small business
- Need hiring tax credits.
- A review of regulations at all levels of government.

There were a number of other great comments but these were the most frequently cited. Speaking of job creation, the latest ADP report showed large businesses with 500 employees or more added only 3,000 new employees, and medium-size businesses added 30,000 workers in August, while small businesses that employ fewer than 50 workers hired 58,000 new workers.


Clearly if the economy is going to get out of its doldrums, small business will lead the way.

Scott Hauge
Small Business California
2311 Taraval Street
San Francisco, CA 94116

Susan Hall- Beloved Employee

Last week I wrote that one of my employees died Wednesday night. Many of you asked about arrangements and where they might be able to make a contribution in her name. Please see email from her daughter. For those who knew her she was a special person and will be missed.


Scott Hauge
Small Business California
2311 Taraval Street
San Francisco, CA 94116

Friday, September 02, 2011

Mike Rossi & Tragic Employee Loss

On September 16th Lori Kammerer and I will be meeting with Mike Rossi, the economic development Czar for the Governor. If you were to meet with him, what would you say the state should do to stimulate the economy and create jobs? Are your receipts increasing, decreasing or staying the same? Do you plan on hiring employees, cutting employees or stayed the same?

Yesterday morning, I received a call informing me that one of my key employees had died of a heart attack the day before. This was quite a shock because she had worked all day Wednesday and seemed fine. She was a person who worked well with all of our customers and the insurance companies we represent. She was here almost 16 years and is loved by all employees at CAL Insurance. I don’t know how many of you have experienced this situation, but it raises a whole lot of questions about what do you do when something like this happens. Here are some questions I have:

- How do you deal with your employees after this occurs?
- How do you let your customers know?
- How do you let your suppliers know?
- How do you work with the family?

Also, do you have the talent within your company to replace this person or are you going to have to go outside the company? If you have to go outside the company where do you find people to replace this person? Do you need to bring in someone on a temporary basis or can the existing employees pick up the slack? These are just a few of the issues I am facing but I think it illustrates part of the planning employers must do to prepare for such an occurrence.

Scott Hauge
Small Business California
2311 Taraval Street
San Francisco, CA 94116