11-3-08

 11-3-08Badlands JournalSome observations on the housing problem...Badlands Journal editorial boardhttp://www.badlandsjournal.com/print/6941Comparison of Ownership vs. Rental Costs Points to Negative Equity Accruals in Many Markets Over the Next 4 YearsPolicy makers should exercise extreme caution in intervening in housing market as prices continue to fall to trend levels.Center for Economic and Policy ResearchFor Immediate Release: October 28, 2008Contact: Alan Barber, 202-293-5380 x115 (CEPR);Taylor Materio: 202-662-1530 x227 (NLIHC)http://www.cepr.net/index.php/press-releases/press-releases/comparison-of-ownership-vs.-rental-costs-points-to-negative-equity-accruals-in-many-markets/ [1]WASHINGTON, D.C. - As the housing market meltdown continues unabated, a report released today by the Center for Economic and Policy Research (CEPR) and theNational Low Income Housing Coalition [2] (NLIHC) shows that in many bubble-inflated markets, homeownership remains a costly and risky proposition.The study, "The Changing Prospects for Building Home Equity: An Updated Analysis of Rents and the Price of Housing in 100 Metropolitan Areas [3]," evaluates the median house price and fair market rent, as determined by HUD, for the 100 largest metropolitan areas. The study extends and updates the methodology from two earlier studies, "Ownership, Rental Costs and the Prospects of Building Home Equity: A Comparison of 100 Metropolitan Areas [4]," and "The Cost of Maintaining Home Ownership in the Current Crisis: Comparisons in 20 Cities [5]," to the 100 largest metropolitan areas in the U.S.The new analysis [6] shows the wide diversity in housing markets across the country. While many metropolitan housing markets continue to be subject to real estate bubbles, prices are not out of line with rents in large parts of the country. The findings of the report again show the importance of not relying on a one-size-fits-all solution to the current housing crisis.The report also notes the problems that many homeowners are likely to face finding quality rental housing due to its limited availability."Despite the extreme downward pressure in homeownership and labor markets, rental vacancy rates remain stable and rents continue to inch up" said Danilo Pelletiere, NLIHC Research Director and a co-author of the report. "There was a critical need for affordable rental housing before the foreclosure crisis and the problem is only getting worse.  Creating affordable rental housing in the face of foreclosure is important to keep people in their communities and stabilize housing markets.”According to the report, which analyzed data from the Census Bureau's American Community Survey [7] (ACS), the most inflated markets currently see monthly homeownership costs outpacing rental costs by as much as 300 percent. This creates a substantial and unnecessary drain on household income, especially for middle- and lower-income families."This could mean that families may have to forgo health insurance or quality child care as they struggle to make their mortgage payments, " said Dean Baker, Co-Director of CEPR and an author of the study. "Furthermore, since prices are still falling in these markets, many homeowners won't ever accrue any equity."The study projects that even though prospects for equity accrual have improved slightly in bubble markets, most homeowners will still leave their homes with large amounts of negative equity if house prices return to trend levels. For example, it projects that by the year 2012, homeowners in New York will have $101,964 of negative equity and in Los Angeles the shortfall would be $168,069. In these, and other bubble markets, households would benefit from proposals that attempt to provide affordable rental options as part of policy solutions.For cities where the costs of owning are much closer to rental costs, it is likely that a small amount of equity will be accrued. In these markets, policies that keep owners in their homes, possibly through some form of government-guaranteed mortgage, are preferable.Real estate near bottom?Comparing rent to sale value shows that now is time to buy, study says...J.N. Sbranti…Modesto Bee...10-29-08http://www.modbee.com/local/story/479278.htmlA new way of calculating the actual value of a house indicates that maybe, just maybe, Northern San Joaquin Valley home prices have hit bottom.A national analysis on the cost of renting versus owning a home uses historic trends to determine a "floor" for home prices. That study, released Tuesday, predicts whether those who buy homes today will gain or lose equity during the next four years.It's based on ratios comparing rental costs to home prices, dating back to 1895.The formula determines that the right price for a house is roughly 15 times its annual fair market rental rate...Merced Sun-StarForecasters uncertain about California waterWithout El Nino or La Nina, precipitation is up in the air...MARK GROSSI, The Fresno Beehttp://www.mercedsunstar.com/167/story/528643.htmlForecasters are flipping a coin when asked whether California will endure a third dry year in a row. Maybe yes, maybe no.Meteorologists can't bet one way or the other this year because there is no warm-water El Niño or cold-water La Niña in the Pacific Ocean. El Niño can mean more rain; La Niña can mean less.This year, the ocean is La Nada -- the unofficial term that means the ocean's water temperature is normal, offering no clues for forecasters and little encouragement for farmers or reservoir operators."I have yet to see a long-range forecast that I would put money on," said meteorologist and consultant Jan Null of Golden Gate Weather Services, based in Saratoga.Uncertainty is the last thing San Joaquin Valley farmers and reservoir operators want to hear. Reservoirs already are down to about 60 percent of average for this time of year. The reserve in storage is dwindling with each dry year.The rainfall season of 2006-07 was 59 percent of average, and the following year was about 73 percent, according to state records.Farm and water officials say next summer will be ugly without at least average precipitation this winter. Crop fields will go out of production, adding millions of dollars in losses and unemployment to a bleak state economy.There is one climate hint called the Madden/Julian Oscillation -- a powerful tropical wave of wind that circles the globe in 30 to 60 days.The wave is occurring right now and helped bring the first significant rain and snow to the state this weekend.Sometimes the wave also sets up a pineapple express, blowing a steady stream of storms thousands of miles across the Pacific into California. The storms this weekend could signal the start of a wet November.But forecasting this wave is a longshot compared to El Niño and La Niña. The phenomenon is not well understood. Government scientists won't use it in predicting this winter's precipitation."We have no idea if it will continue through the winter," said Mike Halpert, deputy director of National Oceanic and Atmospheric Administration's Climate Prediction Center in Maryland.Farmer Dan Errotabere, who is a board member for Westlands Water District, is preparing for the worst and hoping for the best.Errotabere farms about 5,600 acres around Riverdale, Five Points and Huron. He buys Northern California river water from the federal Central Valley Project and uses deep-well pumps on his land. He's planting 30 percent to 40 percent less acreage this year, anticipating less irrigation water.Errotabere places his highest priority on preserving his almond trees, a long-term investment. He cuts back on his annual planting of row crops, such as tomatoes. He said he will plant additional acreage if there is a lot of precipitation.Reservoir operators share his anxiety. Ted Selb, deputy general manager at the Merced Irrigation District, said Lake McClure, the agency's primary reservoir, is short by almost 200,000 acre-feet of water at this point this year.Each acre-foot -- 325,851 gallons or a year's supply for an average family in the Valley -- is precious, he said. The district spent $2.3 million pumping 100,000 acre-feet from its own wells last year to supplement farm supplies.The underground water supply is like a bank account, water officials said. They do not want to risk exhausting this supply with further pumping."It's got to rain this year," Selb said. Circuit City closing 155 stores, including Merced branch...MICHAEL FELBERBAUM, Associated Press Writerhttp://www.mercedsunstar.com/167/story/528848.htmlCircuit City Stores Inc. said Monday it is pulling the plug on about 20 percent of its U.S. stores in an effort to return the nation's No. 2 consumer electronics retailer to profitability. The Merced store and several in the San Francisco Bay area are among those closing, but the stores in Modesto, Turlock, Manteca and Stockton were spared.The Richmond, Va.-based company said it will shutter 155 of its more than 700 stores in 55 markets, including Phoenix and Atlanta, by Dec. 31, laying off about 17 percent of its domestic work force. Circuit City also said it will further reduce new store openings and plans to work with landlords to renegotiate leases, lower rent or terminate agreements.The company said it expects the stores it is shuttering, which generated about $1.4 billion in net sales in fiscal 2008, will not open on Tuesday and store closing sales will begin on Wednesday.The move comes as Circuit City heads into a crucial holiday shopping season that could determine its future, amid a slowdown in consumer spending that has even the least vulnerable retailers worried."The weakened environment has resulted in a slowdown of consumer spending, further impacting our business as well as the business of our vendors," James A. Marcum, vice chairman and acting president and chief executive officer said in a statement. "The combination of these trends has strained severely our working capital and liquidity."...Modesto BeeLocal governments will have to tighten retirement benefits...Editorialhttp://www.modbee.com/opinion/story/485343.htmlAs the stock market continues its gyrations, almost all people with a 401(k) account have seen a precipitous decline in their nest eggs. For state and local governments, whose pension funds hold the equivalent of hundreds of thousands of 401(k) accounts, the losses are magnified astronomically.But unlike individual retirement accounts, government pensions are guaranteed. When stock market earnings fall and retirement funds dip below specified levels, state and local governments must make up the difference. So counties, cities, schools, special districts and the state are bracing for big increases in the contributions they are required to make to employee retirement funds.The California Public Employee Retirement System reported that its pension fund lost a staggering 20 percent of its value -- $48 billion -- between July 1 and Oct. 10. The CalPERS fund, which peaked at $260.4 billion at the end of October 2007 and was at $239 billion in July, was worth $192.7 billion late last month.If stock markets continue to decline, local and state government will have to make up for those losses. CalPERS officials warned that the increased contributions employers will be required to make to backfill investment losses could amount to 2 percent to 4 percent of payroll.It is impossible to reduce benefits already promised, but the state and local governments ought to take steps to reduce future costs. That will mean rolling back benefits or increasing retirement ages for new hires. State and local government should also consider calculating benefits based on workers' average wages over the last three years on the job rather than just their last (and usually highest) year's salary.It may seem unfair to establish a lower tier of benefits for new workers who are being asked to perform the same job as their older colleagues, but state and local governments may have no choice.A decade ago, lavish retirement benefits were approved that allowed many in government to retire in their mid- to late 50s with 80 percent of pay plus health care benefits for life. For police, firefighters and prison guards, the benefits rose to 90 percent of pay. Even when the stock market was soaring, state and local governments were having difficulty paying pension costs. With the dramatic drop in investment earnings, the situation is approaching crisis proportion. The city of Vallejo has already filed for bankruptcy. Other local governments may follow suit if they don't do something to reduce the mounting costs of retirement.Fresno BeeThis year, weather system is La NadaMeteorologists: Unpredictible storm system may leave state facing another dry year....Mark Grossihttp://www.fresnobee.com/local/v-printerfriendly/story/982249.htmlForecasters are flipping a coin when asked whether California will endure a third dry year in a row. Maybe yes, maybe no...Farmer Dan Errotabere, who is a board member for Westlands Water District, is preparing for the worst and hoping for the best...But, as a Westlands farmer, he also must contend with federal water cutbacks for endangered fish species. He might only get 50% of his federal allotment, even if there is a wet winter."It's a big crapshoot," Errotabere said. "I don't want to walk away from a crop next summer because I didn't get enough water. So I play a pretty conservative hand." ...California has not had an extended drought in more than 15 years, state records show. At worst, there were back-to-back dry years in 2001 and 2002, followed by an above-average season in 2003. The last extended drought went from 1987-92. El Niño and La Niña both occurred during those years. The two conditions are opposite ends of water temperature swings in the eastern Pacific. Warm water is El Niño; cold water is La Niña. The water temperature helps to alter wind patterns, directing storm fronts to some parts of the globe and away from other parts. For instance, Australia and Indonesia are prone to drought during El Niño, while the U.S. Southwest -- including California -- often gets more rain. The opposite tends to happen during La Niña.La Nada, the neutral ocean conditions now prevalent in the Pacific, also took place in two seasons during the California drought from 1987-92. Indeed, climate influences -- El Niño, La Niña, the Madden/Julian Oscillation and others -- are never a sure bet. To illustrate that point, meteorologist Null compiled a list of the 10 most costly California storms since the 1950s. Four happened during El Niño, two during La Niña and four during La Nada. The ocean was La Nada during January 1997 when a pineapple express swamped California, causing approximately $1.8 billion in flood damage and put Yosemite Valley under water. But at least El Niño and La Niña can give scientists an idea of what might happen. La Nada is a blank.Said Null: "Nobody has a silver bullet to predict this season." Sacramento BeePlacer to discuss Drexel campus plan...Bob Walterhttp://www.sacbee.com/placer/story/1366353.htmlThe plan has been in the works for years: A prestigious private university with some 6,000 students and a potential economic impact of more than $105 million a year could be built on 1,157 acres just west of Roseville.Drexel University of Philadelphia is considering investing as much as $400 million on the university site, on land donated by developer Angelo K. Tsakopoulos and several partners.And with the school in place, about half of the land would be sold for commercial and residential development, with proceeds benefiting the university. Opponents, however, say it represents leapfrog development and would spur urbanization of other nearby agricultural parcels -- including thousands of acres owned by those donating the university site.Placer County supervisors will take up the plan at 1:30 p.m. Tuesday in Auburn. The hearing's timing -- Election Day -- was coincidental but preferable to the next opportunity, two days before Thanksgiving, county staffers said.The plan was unanimously approved by the county Planning Commission in September.In 2005, before Drexel surfaced as the first choice, 61 percent of county voters approved an advisory ballot measure that asked if the site should be designated for a university.Forces on both sides agree on one thing: A private university - Drexel or a comparable institution - would be a valuable asset for the region.A 2004 study by the Sacramento Regional Research Institute said that even a smaller university -- about 4,000 students -- could generate $105 million a year and more than 2,000 jobs."The economic impact would include money that spins out in salaries, goods and services that are purchased ... and it can attract research money and collaborative partnerships with industry," said Barbara Hayes, executive director of the Sacramento Area Commerce and Trade Organization, the region's chief economic recruiter.Said Terry Davis, coordinator of the Mother Lode Chapter of the Sierra Club and the leading opponent of the plan: "What county would not want such a university?"The opposition from Davis and others is focused on the site -- and the rest of the surrounding Curry Creek Community Plan area, which could accommodate 56,000 more people, according to county planners.Critics also say the county already has enough land for urban growth."I just think you shouldn't sell your soul to get (a university)," Davis said. "Do you abandon all your planning principles ... and let a major real estate speculator manipulate the land use planning process to get it?"Former county Supervisor Harriet White, who was on the board when a similar plan surfaced seven years ago, said, "The site still bothers me.""If it were just the university, it would be fine. ... But you have to put a stop somewhere," she said.Rex Bloomfield, another former supervisor, said he fears donors "will lean on the board to allow more homes ... on the acreage they own" and that taxpayers will foot the bill for public services far from existing population centers.But Supervisor Robert Weygandt, whose district includes the university site, said, "The reality is there aren't any other people stepping up ... and offering this kind of donation.""Concerns about this plan creating other development opportunities in that area are valid," he said. "But Michael (county Planning Director Michael Johnson) and staff have assured me that the university site can stand alone."Weygandt said the board must weigh future development in the area against the importance of the county's conservation plans, which include preserving agricultural land.Johnson said the university site is adjacent to part of west Roseville that is targeted for development and will bring roads, sewer, water and other services to the area.The 1,157 acres -- south of Pleasant Grove Creek and north of Base Line Road -- are owned by the Angelo K. Tsakopoulos family, Bill and Claudia Cummings and Wayne and Mary Prim.Under the plan -- when Drexel or another university signs on -- the land would become an irrevocable gift from the owners, and the university zoning could not change for 50 years.About 600 acres would become the university campus. The rest would be sold by the university and developed as 3,232 residences, 1,155 university dwellings, 22 acres of commercial space and 220 acres of park, open space and public land.All proceeds from the sale of acreage adjoining the campus would go to the university.Julie Hanson, project manager for Tsakopoulos' KT Development and the other donors, stressed that no development plans have been prepared for other adjacent land."Every acre that is being considered in this plan is being donated," she said.Development of the university site would not happen quickly.Drexel has five years to pull the trigger if the Placer site is approved.The 117-year-old university is investing at least $10 million to create the Drexel Center for Graduate Studies in downtown Sacramento. The center will open in January, offering five master's degree programs.Meanwhile, Drexel will continue to study the Sacramento region, said Carl "Tobey" Oxholm III, Drexel's executive vice president.The university has no timeline for deciding when to build, Oxholm said. Editorial: Time for a deal on San Joaquin?http://www.sacbee.com/editorials/story/1365041.htmlThe water wars of yesteryear continue to plague California as it struggles to address its water challenges, including the crisis in the Sacramento-San Joaquin Delta.Two years ago, a fragile peace broke out between environmentalists and farmers near Fresno over an 18-year-old lawsuit involving flows in the San Joaquin River.The 2006 court settlement, negotiated by the Natural Resources Defense Council and irrigators who receive water from Friant Reservoir, was aimed at restoring some flows to the San Joaquin by 2009. They also had an ambitious goal of restoring salmon by 2013 to a river that hasn't seen them for decades. Yet like the situation in Afghanistan or other tribal territories, peace does not come easily to the San Joaquin River. U.S. Sen. Dianne Feinstein, the main peacemaker in the region, has struggled for two years to pass legislation to implement the river-restoration package, partly because tribal elders continue to feud.In the next few weeks, Feinstein may have a narrow window of opportunity in which to get this deal done. Congressional leaders are mulling whether to call a lame-duck session, mainly to pass an economic-stimulus package. If such a session were to be called after Tuesday's election, Feinstein could – and should – seize the moment for her river- restoration legislation.It won't be simple. In September, Feinstein tried to attach her river bill, which contained $250 million for channel improvements and other work needed to restore salmon, to an omnibus lands act. Republicans objected to the overall price tag of the package and it got bogged down in procedural hurdles.As a result, Feinstein removed much of the spending from her bill, leaving only $88 million in direct spending for river restoration. That alarmed various irrigation districts, which fear the river- restoration mandates could become law without the funds needed to mitigate the impacts on them.This concern is legitimate, but overblown. Feinstein is a senator of her word, and one with sizable clout. There should be little doubt she'll be able to secure federal appropriations, as well as state funding committed for the San Joaquin settlement.Irrigators also need to examine the alternatives.If this settlement unravels and the San Joaquin case goes back to court, a federal judge could issue a harsh and immediate order on river flows, adding to the woes of farmers.For everyone's sake, Feinstein must find a way to get this river-restoration package passed, and tribal warriors need to sheath their swords. If this deal blows up, the casualties will include not only irrigators and river-restoration advocates, but also peace treaties involving much-larger water issues.Hoping for a deal in the Sacramento-San Joaquin Delta? One that would improve habitat, increase water supplies and better manage the conflicts? Such a deal could evaporate if the San Joaquin River-restoration package becomes a victim of tribal warfare. Stockton RecordDistrict appeals water lawsuit...Alex Breitlerhttp://www.recordnet.com/apps/pbcs.dll/article?AID=/20081103/A_NEWS/811030320STOCKTON - Stockton East Water District v. United States of America.Sounds like a mismatch.But Stockton-area water officials said they like their chances of successfully appealing a lower court's ruling that the federal government was justified in withholding water - even though $65 million was spent to get the water to the area.Stockton East and the Central San Joaquin Water District in 1983 agreed to contracts with the U.S. Bureau of Reclamation for water from New Melones Lake, on the Stanislaus River.Stockton has struggled for decades to find additional sources of water, because groundwater is declining and less water from the Calaveras River may be available in the future.Local officials built a tunnel to convey Stanislaus water to the Stockton area - a debt that still is being paid through a nearly $3,000 fee attached to the cost of each new home in the city.And yet, the bureau has rarely delivered the full amount of water promised in the contracts.Some years the districts get no water at all.The water districts sued, seeking $500 million in damages. A U.S. Court of Federal Claims judge in 2007 sided with the government; drought conditions and new laws requiring more water for fish in the Stanislaus River justified the lack of deliveries to Stockton.The districts appealed, and the case was heard earlier this month by a panel of three federal judges."The districts remain hopeful that the court will order the U.S. to keep those promises made in 1983," said Jennifer Spaletta, an attorney representing Stockton East.She told the panel that the contracts required the government to use "all reasonable means" to guard against water shortages.The bureau released water downstream for environmental purposes, yet "tremendous" amounts of water were still available in New Melones following the early drought."The reservoir was overflowing," she said.Kathryn Kovacs, an attorney for the government, argued that the risk of a shortage fell on the shoulders of the districts, as long as the bureau did everything it could. Reservoir managers had to keep water in the lake in case a dry winter would cause the pool to drop the following year, she said."Even if everybody does everything they can, shortages may occur," she said.Mark Madison, director of Stockton's Municipal Utilities Department, said despite the water shortages the tunnel was not a waste of money. It's been used to take water from other irrigation districts."Without those facilities, this area would have had major difficulty in meeting water demands even today," Madison said. "That was a worthwhile investment on our part."Spaletta said a decision from the appeal judges is expected in three to six months.San Francisco ChronicleThe delta's wake-up call...Spreck RosekransSpreck Rosekrans is a senior analyst with the Environmental Defense Fund in San Francisco and a member of the Delta Vision Stakeholder Coordination Group. To read the Delta Vision report, go to links.sfgate.com/ZFGOhttp://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/11/03/EDJF13S5TP.DTL&type=printableWake up, California. Do not hit the snooze button again!It's been clear for decades that the San Francisco Bay-Delta estuary is in peril. The largest estuary on the West Coast is suffering - from ever-increasing water diversions, pollution and invasive species - to the point where scientists talk openly about the extinction of entire fish species. It is clear that potential failure of the delta's fragile levee system threatens delta communities and could disrupt the water system that supplies part of the drinking water to 23 million Californians and much of California's agricultural lands as well. Last Friday, the governor's Delta Vision Task Force released its strategic plan addressing the bay-delta's ecosystem and water-supply problems. The plan represents a clear-eyed break with the past. The task force recognizes that protecting the environment of the delta is just as important as providing reliable water supplies to cities and farms. The task force urges California to base its water future in the reality that water is a limited resource, that enormous water diversions have adverse consequences, and that ecosystem collapse is not an acceptable option. The Delta Vision report offered by the task force emphasizes the urgent need for expanded habitat and freshwater flows to restore salmon and other decimated fisheries. Its recommendations for improving water-use efficiency, eliminating disincentives for sustainable groundwater management and encouraging sales of water between willing buyers and sellers, so long as local communities are not harmed, are long overdue. The task force's recommendations for a peripheral canal raise questions from both an environmental and a financial perspective. We understand that a canal would enable continued delivery of water from the Sacramento Valley to cities and farms further south, even in the event of a levee failure. But the canal would vastly diminish the flow of freshwater into the delta. The task force's vision does not include a plan for assuring that its design and operation would protect not only salmon and other fisheries, but delta agriculture and communities as well. We are also concerned by the plan's recommendations to pursue additional dams, in part because recent proposals would build them at taxpayer expense without any clear understanding as to how the additional water supply would be distributed. Recent history has shown that when water agencies pay for their own supply projects, they usually find alternative investments such as conservation, groundwater management and cleanup, and purchases from willing sellers to be more cost-effective investments than new dams and reservoirs.Ultimately, success or failure will depend on whether agencies, the California Legislature and communities can work together effectively. We are intrigued by the task force's recommendations for agency reform - including a new council to govern the Delta Vision's coequal goals of water supply and environmental restoration - though simply adding one more agency could be counterproductive if not done right. The Delta Vision plan now moves to the governor and the Legislature. To avoid the mistakes of the past, they must build on the foundation of balance between the ecosystem and water supply. We urge lawmakers to spend taxpayer dollars only to achieve tangible public benefits. Further subsidies are likely to continue the inefficient distribution of water that has led California to its famously costly and fruitless water wars.The Delta Vision report is far from perfect, but ignoring it would put both the delta and California's water supply at risk. If we hit that snooze button, the next wake-up call might come too late.A controversial new pesticide...Lynette Evans, Village Greenhttp://www.sfgate.com/cgi-bin/blogs/sfgate/detail?blogid=50&entry_id=31834Here's something that should worry anyone who is concerned about the continued use of toxic chemicals in farming.The U.S. Environmental Protection Agency (EPA) has given final approval for use of methyl iodide, a new pesticide that its developer James J. Sims at UC Riverside, which holds the patent, and manufacturer Arysta LifeScience, think should replace the now banned methyl bromide in the strawberry fields of the state. (As Deborah K. Rich reported in a story about the difficulties of growing organic strawberries commercially in the Oct. 25 Home&Garden section of The Chronicle, methyl bromide is still being used in California under special exemption, even though the soil fumigant was banned by the Montreal Protocol because of its ozone-damaging properties.)Because methyl iodide, a liquid with a low boiling point, is too unstable to reach the upper atmosphere, it is superior to the gas methyl bromide when it comes to global warming, but, according to Chemical & Engineering News, the weekly online newsletter of the American Chemical Society, which released a report on the chemical on Oct. 27, if handled improperly, methyl iodide is extremely toxic. In "Methyl Iodide Saga Continues: EPA gives green light to soil fumigant, but California is still assessing risks," the ACS says the chemical can damage DNA and thus should be considered a carcinogen. According to the report: "Methyl iodide is so toxic because it is a strong alkylating agent, says Robert G. Bergman, an organometallic chemist at UC Berkeley. Alkylating agents can chemically modify DNA and can alter gene expression." "Bergman is among a group of 54 scientists, mostly chemists, who sent a letter to EPA in September 2007 asking the agency not to approve the use of methyl iodide as a soil fumigant because of fears that it would harm farm workers and people living near agricultural sites where it is applied," the report says, and goes on to quote Ted Schettler, a toxicologist and physician with Science & Environmental Health Network, who worries about possible damage to developing brains. The EPA's testing focused on thyroid effects, and "had no developmental neurotoxicity data," Schettler said. Scientists are concerned as well about the objectivity of EPA's review process.California has been studying methyl iodide since 2005 and has not yet approved its use in the state, but Florida has OK'd methyl iodide for "high value crops" -- including strawberries, tomatoes, peppers, stone fruits, tree nuts, vines and ornamentals -- all crops that are grown as well in California, and all crops that Arysta LifeScience would like to see grown here in soil fumigated by the chemical. The California EPA's Dept. of Pesticide Regulation has targeted late 2009 to complete its review, so there's still time for the public to weigh in.According to the ACS report, large-scale orders for methyl iodide "haven't yet materialized because of the risk assessments that various states decided to perform. Otherwise, millions of pounds of the fumigant probably would have been injected into soils across the U.S. during the 2008 growing season, says Susan Kegley, a senior scientist with the Pesticide Action Network North America (PANNA), a nonprofit group that has been pushing for a ban on all soil fumigants for years." Anyone who lives near a strawberry field, or has small children, may want to include their voices in the movement toward that ban.CNN MoneyConstruction spending falls Government reading for September sinks less than expected, with residential construction showing weakness...Lara Moscriphttp://money.cnn.com/2008/11/03/news/economy/construction_spending/index.htm?postversion=2008110313NEW YORK (CNNMoney.com) -- Construction spending fell in September, according to a government report released Monday, although the decline was smaller than economists expected. Spending fell 0.3%, to a seasonally adjusted annual rate of $1.06 trillion, the Commerce Department reported. That follows a 0.3% gain in August and a steep 2.4% decline in July. The September figure is down 6.6% from the same time a year ago.Construction spending was expected to fall by 0.8%, according to a consensus of economists surveyed by Briefing.com.Ken Simonson, chief economist for Associated General Contractors of America, said the report shows overall weakening in construction sector, with some good news coming from nonresidential construction.He called September's 0.1% uptick in nonresidential construction a "modest, pleasant surprise" amid reports of construction projects in the ground being frozen as financing dried up.However, residential construction fell 1.3% from the month prior. Both figures are down from a year ago, with residential construction spending falling 27.1% and nonresidential falling 8%.Spending on private construction increased 0.1% in September, after sinking every month since May. The report's strongest news came from a 1.2% increase in private nonresidential construction, but Simonson doesn't think this growth is sustainable, and expects it to drop soon. He said it doesn't make sense for developers to build new offices and stores amid news of mass layoffs and store closings."If there is retail construction, it's more likely they'll change the sign outside the store and make improvements inside, rather than build a new store," he said.Private residential spending fell by 1.3%, an indication of the battered housing market. Public construction fell 1.3%, following a 1.3% increase in August. Within the category, nonresidential spending fell the most, with the biggest cuts coming from conservation and development.With the exception of spending in power and energy-related construction, Simonson expects other categories of spending to weaken further in October