Modesto Bee
Median home prices fell nationwide in 4Q...ALAN ZIBEL, AP Real Estate Writer
WASHINGTON -- Home prices fell in nearly nine out of every 10 U.S. cities in the fourth quarter of last year as low-cost foreclosures flooded the market and the housing market's decline spread nationwide.
The National Association of Realtors said Thursday that median sales prices of existing homes declined in 134 out of 153 metropolitan areas compared with the same period in 2007. Sales fell in all but six states.
Nationwide, the median sales price was $180,100, down 12 percent from a year ago. But price declines of 30 percent or more were found in much of California, plus parts of Michigan, Florida, Arizona and Nevada. The biggest drop, of more than 50 percent, was in Fort Myers, Fla.
President Barack Obama visited Fort Myers earlier this week in an effort to sell his economic rescue package, which lawmakers are preparing to send to his desk by Friday.
The states in which sales rose - Nevada, California, Arizona, Florida, Minnesota and Virginia - are places where buyers have been able to snap up foreclosed homes at a bargain. Sales more than doubled in Nevada, rose 85 percent in California, and nearly 43 percent in Arizona.
"We see a pattern of strong sales gains, particularly in lower price homes, in areas with price declines resulting from foreclosures," Lawrence Yun, the trade group's chief economist, said in a prepared statement.
In California and Florida, sales of distressed properties accounted for about two-thirds of all sales, compared with about 45 percent nationally.
A nasty brew of strict lending standards, falling home values, soaring foreclosures and a severe recession is filtering through the housing market.
Nationwide, more than 274,000 homes received at least one foreclosure-related notice in January, according to RealtyTrac Inc., an Irvine, Calif.-based foreclosure listing service. That was down 10 percent from December, but still up 18 percent from the same month a year ago. The numbers would have been higher if not for efforts to stall the foreclosure process.
More than 2 million American homeowners faced foreclosure proceedings last year, and that number could soar as high as 10 million in the coming years depending on the severity of the recession, according to a report last month by Credit Suisse.
Continued nuclear dump fight urged...BRENDAN RILEY, Associated Press Writer
CARSON CITY, Nev. -- Legislators told Gov. Jim Gibbons on Wednesday to back off from cuts in the state agency leading the fight against federal efforts to open a high-level radioactive waste dump at Nevada's Yucca Mountain.
During a Senate Finance Committee hearing on the state Agency for Nuclear Projects, Sen. Bob Coffin, D-Las Vegas, told Bruce Breslow, the new head of the agency, to "be a mad dog on this issue" in battling the federal Department of Energy.
Coffin added that Gov. Gibbons "has a promise to the people of Nevada to keep, not to himself about his political career." He complained that the governor's cutback plan for the state agency signaled to dump proponents that "Nevada is quitting."
Finance Chairwoman Bernice Mathews, D-Reno, she didn't understand how Gibbons could propose cutting the agency staff from seven to two workers, one of them part-time, after a state fight against the dump project that has been waged for more than 20 years.
When advised by state Budget Director Andrew Clinger that a pending audit could change the governor's budget proposal, Mathews questioned why the cuts were recommended before the audit was done, adding, "It sounds like the cart before the horse, in my opinion."
Breslow said he is hoping to get the agency staffing level up to four, plus a key contract employee. He added that in talking with Gibbons "I looked him in the eye and asked him the question, 'Are you opposed to Yucca Mountain?' He assured me he is."
Breslow, who recently replaced Bob Loux as head of the agency, and Clinger also said the agency expects to get nearly $5 million a year from the DOE. Breslow said that money would be used to cover the state attorney general's costs in hiring expert attorneys to continue a legal battle against the dump.
Senate Minority Leader Bill Raggio, R-Reno, told that the state's legal costs could run as much as $20 million, said there's no state general fund dollars to help cover that cost. He said Nevada's congressional delegation should be urged by the governor to find a federal source for the money.
Senate Majority Leader Steven Horsford, D-North Las Vegas, said the state can't just ask for more federal funds. He said there's an obligation to provide proper state funding.
While no members of Senate Finance spoke in favor of the Yucca Mountain dump project, Assemblyman Ty Cobb, R-Reno, issued a press release on Wednesday stating Nevada should "begin a dialogue" with the DOE and see whether the dump could be used for interim storage rather than long-term storage of radioactive wastes.
"For far too long Nevada has taken an adversarial role to this project often without a clear understanding of its potential benefits," Cobb stated, adding that reprocessing of the wastes could eliminate much of the stored materials and position Nevada "at the forefront of energy research."
Valley Voice
Court: Tulare Must Redo General Plan...John Lindt
Tulare - The city of Tulare will likely have to head back to the drawing board to finalize its General Plan Update, according to a preliminary court ruling by Tulare County Superior Court Judge Patrick O'Hara.
The court tentatively ruled this week that the city failed to fully analyze several key impacts the plan might have – charges set out in two legal challenges brought by the Bakersfield chapter of the Sierra Club and Tulare resident Don Manro.
The plan that guides the future growth of the community had been approved by the city council in April.
But this week, the city learned it will have to reopen public hearings in coming months in what could be another long delay before it is approved.
“The ruling is not final but it appears to completely vindicate the points we made in our lawsuit,” said Sierra Club attorney Babak Naficy on Tuesday.
O'Hara, in the ruling announced Feb. 9, cited shortcomings in the Environmental Impact Report (EIR) of the plan including a failure to analyze the greenhouse gas emissions of the project, the plan's effect on water supplies, the conversion of prime ag land and several other conflicts between plans. The city has asked for a hearing before the ruling becomes final, expected within a few days.
City Attorney Steve Kabot, who did not represent the city in the case, says some projects used the old general plan for backing with “project-specific” EIRs underway and shouldn't be directly affected by this case. The big race track project is one of them. But Sierra Club recently sued the city over that EIR as well.
Kabot emphasizes that the judge's ruling is not yet final. If it stands, however, he says the city could appeal or work with the judge to remedy the chapters (issues) in the EIR that need fixing.
Regarding water, O'Hara's ruling suggested the city's argument that a water deficit would be handled by TID's delivery of future surface water was not backed by facts “to support the conclusion that water supplies will materialize.”
Regarding ag land conversion, the city had promised a future plan to set up an ag land mitigation program upon annexations, but the judge said it failed to offer specific performance criteria. For example, the Sierra Club had suggested the city set up a 3-to-1 mitigation factor – conversion of one acre of ag land to urban use would be offset by purchase of three ag land acres outside the city. The city failed to explain why that was not feasible, the judge said.
O'Hara commented at the end of his brief that now that the city will have to go back to re-certify the EIR, it can add an analysis on new projects that were not included in the plan done a year ago, including the I Street industrial project and the 700-acre race track complex that each have their own EIRs moving forward.
Several matters brought only by Mr. Manro were agreed to by O'Hara, including the assertion that the plan conflicts with other land use plans.
Manro, who has had several lawsuits against the city over the years, told the Voice that the city failed to fully analyze the impacts on Elk Bayou on the southern edge of the city from the motorsports complex project as well as the proposed airport runway extension.
“There are not specific and enforceable standards to do the mitigation,” he says. Manro says the general plan conflicts with other plans underway including the I Street industrial project done without mitigation.
Sacramento Bee
Lead poisoning in wildlife stirs debate on hunting, fishing regulations...Milwaukee Journal Sentinel
MILWAUKEE -- Lead shot from firearms and lead sinkers have been a mainstay of hunting and fishing for generations, but a growing body of research and anecdotal accounts are raising health questions for humans and wildlife alike.
The most recent situation involves trumpeter swans in northern Wisconsin.
Since October, 10 trumpeter swans have been treated by the Raptor Education Group Inc. in Antigo, Wis. In a typical year, the center takes in only about two of the birds.
Three of the trumpeter swans have died, and three are in critical condition. X-rays revealed all had metal shot or sinkers in their bodies. Blood tests showed elevated levels of lead.
Also, a report released in November shows lead residue from gunshots has been found in Wisconsin venison, after concerns were raised in other Upper Midwestern states.
In Wisconsin, 15 percent of 199 samples of commercially processed venison contained lead bullet fragments, according to the report by the Wisconsin Department of Natural Resources and Department of Health Services.
In hunter-processed venison, 8 percent of 98 samples contained lead fragments.
The study used modeling from the U.S. Environmental Protection Agency and suggests there may be a risk of elevated lead levels in blood among children who consume venison.
One of the worst-case scenarios involves children 7 and younger who eat two meals a month of venison that contains higher amounts of lead. The children may have a 90 percent chance of lead levels in their blood rising above tolerable limits set by the Food and Drug Administration.
The two state agencies concluded that lead in venison was an "indeterminate public health hazard," as elevated blood-lead levels hadn't been confirmed in consumers of deer meat.
The agencies are recommending that food pantries use meat processors that minimize bullet fragments in venison.
As for what to do about lead shot, the Department of Health Services - but not the DNR - recommends the "eventual transition to non-lead ammunition."
Efforts to phase out lead shot began in the 1970s. It has been banned nationally for waterfowl hunting since 1991 and on federal wetland and grassland where waterfowl are raised.
Lead can damage the brain, nervous and reproductive systems. It is no longer used in gasoline, paint, pesticides or as solder in metal cans.
The lead-shot ban has helped reduce poisoning of ducks and geese, but federal authorities still estimate millions of pounds of lead from hunting and fishing are deposited on land and in the water each year.
Starting last fall, the DNR began requiring mourning dove hunters to use non-lead shot because of the birds' proclivity to feed near wetland where other wildlife could ingest shot.
DNR Secretary Matt Frank pulled together an existing working group on lead contamination in July and asked members to gather the latest data and take a closer look at the issue, spokesman Adam Collins said.
The agency also provides information for deer hunters on reducing exposure to lead in venison and urges anglers to consider switching to nontoxic metals.
But the DNR has pushed for no other restrictions. Lead is still heavily used for hunting upland birds such as pheasant and grouse, and it is the dominant choice of ammunition in deer hunting.
This troubles bird advocates such as Marge Gibson, executive director of the Raptor Education Group.
In one case, a pair of trumpeter swans were so weak they had to be pulled from the ice last month near Laona, Wis. The birds died from lead poisoning.
In another case, 69 lead pellets were found in an adult male swan from Solon Springs in Douglas County, Gibson said. It, too, died.
"This is very frustrating," she said. "If people spent one day with us and watched these birds fight and struggle for their lives, things might change."
Many sports enthusiasts have pushed for lead-shot restrictions. In 2007, members of the Wisconsin Conservation Congress voted against an advisory question requiring nontoxic shot for all game birds except turkeys, but there was significant support for the measure. Members voted 1,506 in favor and 1,850 against.
The congress advises the DNR on hunting and fishing issues. On this issue, Kurt Thiede, DNR liaison with the group, said the congress has favored education over regulation.
There is no question lead kills wildlife, said congress member Todd Kapp of Trevor, Wis. But he is not sure whether scientists have proven conclusively that lead in the environment is killing wildlife.
"Was it wadded-up fishing gear or lead?" he said. "I just don't want to see a knee-jerk reaction to this."
Cost and performance are other factors for sports enthusiasts. Nontoxic shot costs more. Kapp is also convinced that lead shot has more killing power.
"When lead hits something, it flattens out and transfers into it," he said. Steel is harder, he said, "more bouncy, and the patterns are a little different."
Tom Hauge, director of the DNR's Bureau of Wildlife Management, expressed concern about moving too quickly and antagonizing hunters.
But, he said, "I think the lead bullets in venison reopened the door again. I do believe that over the past couple of years that a lot of things have changed."
"There is much more widespread and compelling bodies of research out there - even in Wisconsin."
In a study presented in May, researchers, led by toxicologist Sean Strom of the DNR, found that lead poisoning was the cause of death in the following cases:
-16 percent of 583 Wisconsin bald eagles that died between 2000 and 2007;
-25 percent of 143 trumpeter swans between 1991 and 2007;
-29 percent of 26 loons beginning in 2006.
The DNR study also found lead fishing tackle in all loons that died of lead poisoning.
It also found the number of lead-related deaths in eagles spiked during the hunting season - especially in November, December and January - when the raptors fed on deer remnants.
"It is unlikely that the prevalence of lead poisoning cases will decrease until the amount of lead discharged into the Wisconsin environment is reduced," Strom and his fellow authors concluded.
The most recent troubles with trumpeter swans could be tied to drought conditions in northwest Wisconsin, where many birds spend summers, said Patricia Manthey, DNR avian ecologist. With low water levels, the long-necked birds feed in previously unreachable sediments.
Also, Minnesota officials reported an increase in lead poisoning this winter after Wisconsin and Minnesota officials jointly asked landowners not to feed the birds.
The states feared the feeding was keeping the birds from migrating. By congregating in open water on the St. Croix and Mississippi rivers, they could be exposed to disease and lead contamination.
The plan backfired, said Dennis Simon, chief of wildlife management for the Minnesota Department of Natural Resources. Some of the swans that foraged on their own picked up lead, he said.
Since October, half of the 32 trumpeter swans brought to the Wildlife Rehabilitation Center of Minnesota in suburban St. Paul, Minn., were treated for lead toxicity, according to Philip M. Jenni, executive director.
Despite the concerns about lead, eagle and trumpeter swan populations are growing. Eagles were removed from protection under the federal Endangered Species Act in 2007. The Natural Resources Board voted last month to remove the trumpeter swan from the state's endangered and threatened species list.
Turning livestock waste into energy can save the farm and perhaps the planet...McClatchy Newspapers
DODGE, Neb. - Where others see simply manure, Danny Kluthe smells money.
Long before President Barack Obama promised the country that "we will harness the sun and the winds and the soil," Kluthe already had yoked the power of pig poop.
Manure from his hogs drains as a slurry into a giant vat. It is stirred and warmed. A virtually odorless liquid - ideal for fertilizing surrounding fields that, in turn, feed more pigs - emerges from the giant digester.
The real beauty, though, comes in the methane fumes that rise off the muck. They are funneled to a tractor engine and used to power a generator. Suddenly his electrical utility is writing checks to him.
"There will be a day when there will not be a hog facility or a dairy built without one of these things," Kluthe said. "This," he said with the glee of someone who has figured out how to spin straw into gold, "just makes too much sense."
What helps save the farm could help save the planet.
Because Kluthe doesn't let the methane from hog waste waft away, his sewage lagoons pack one-twentieth the climate-changing punch they would otherwise.
In fact, his dung-to-dollars system is but one way agriculture can put food on your plate without dumping so much greenhouse gas into Earth's atmosphere.
Other fixes can be made earlier in the process: improving grassland diversity, spreading fertilizer more precisely and tweaking animal food.
While agriculture accounts for just 6 percent of greenhouse gases in the United States, it is responsible for more than half the methane and nitrous oxide emissions. In Missouri and Kansas, those two climate-changers come almost entirely from farming.
Molecule for molecule, methane has about 21 times the impact as a greenhouse gas as carbon dioxide. Nitrous oxide is 300 times as powerful.
They may be some of the easiest to cut back, however.
"There's a lot of opportunity for agriculture to get this low-hanging fruit," said Evan Branosky, a research analyst at the World Resources Institute, an environmental think tank. "You can do some simple practices that are going to result in large reductions."
Better farming practices are part of the Regional Greenhouse Gas Initiative, a new carbon-trading market among 10 Northeastern states that requires power plants to offset their carbon dioxide emissions.
Those sorts of carbon credits - where a polluter in one part of the economy balances out their damage by paying someone else to cut back on their greenhouse gases - could provide an incentive to pay for greener farms.
Ranchers and feedlots already have plenty of enticement to fatten cattle as quickly as possible, but the ideal feed isn't always the most economical. And low-impact tilling and chemical treatments don't always fill the most bushels at harvest.
Likewise, anaerobic digesters such as the one Kluthe runs to transform effluent into energy don't get built unless a government grant is involved.
Indeed, even as analysts see great hope for cutting back on greenhouse gases from farming, they also stress that there are no universal fixes.
"It's important not to make blanket statements," said Karin Wittenberg of Canada's National Center for Livestock and the Environment. "There are a lot of factors to weigh."
Cud-chewers have roamed the planet for millennia, but not in the concentrations seen since our meat- and dairy-loving civilizations figured out how to raise them on a massive scale.
Going vegetarian would be the quickest route to eliminating that impact, but history has shown that those who can afford to eat higher on the food chain are sure do to so.
So why not give livestock the farm equivalent of Beano?
Take, for instance, Bessie's diet. A dairy cow eating high-protein feed makes more efficient use of her meals than a bovine eating low-quality hay.
That means bacteria in her rumen, the fermentation chamber that serves as her first stomach, will produce less of the methane that makes her belch and fart. The better her feed, the better for her farmer, the better for her planet.
But it's not always that simple. For starters, a pregnant cow might be fed low-quality forage if that is the only economical food available through the winter after a poor harvest. Costlier cow chow could mean no profitability for a marginal rancher.
Secondly, growing that heartier feed of corn, soybeans or alfalfa might burn more equipment fuel or consume more nitrogen fertilizer - quickly negating any gains made by nurturing a not-so-gassy animal.
While the Midwest is awash in grain, livestock raised elsewhere don't have such easy access to that kind of feed.
Still, gains can be made at the margins of even large-scale commercial agriculture, changes that make both farmer and climate scientists rest easier:
Diversify plants in a pasture. That way everything doesn't bloom at once and then, even during dry stretches in the summer grazing, cattle can find more than the dregs of dried grasses for dinner. As cheap and simple as it seems, even that would require that ranchers pay attention to something they might ordinarily leave to nature.
Chemistry. Some scientists think there might be hope in a vaccine or inoculation that eliminates or reduces the methanogens - the bacteria responsible for the enteric fermentation and its methane waste.
Breeding. By raising animals that make the most of a meal, costs of production stay low without manufacturing so much methane in a cow's stomach.
Raising something adapted to a region. Perennial plants require far less energy, don't demand the plowing that release carbon dioxide from the soil and use less fertilizer to grow a crop. Researchers are looking for more plants that might fit the bill, and the promise is strongest for livestock feed.
Or consider kangaroo steak. A University of New South Wales study found that using kangaroos instead of sheep and cattle - both grazing ruminants with those gassy bacteria in their stomachs - could produce the same tonnage of meat and lower Australia's greenhouse gas output by 11 percent.
Precision. More care taken to apply fertilizer on narrow seed rows - rather than broadcast across a field - can dramatically lessen nitrous oxide released.
"Some of these things are being done already," said Gene Takle, a professor of atmospheric science at Iowa State University. "... more things we might be able to do pretty easily in the future."
Consider the potential of biogas electricity. The manure an average hog produces in a day could light a 40-watt bulb eight hours. A typical dairy cow's droppings could power the same bulb 95 hours.
Put another way, the hogs and dairy cows in Missouri and Kansas combined could provide electricity for more than 77,000 households.
Still, the potential sale of that electricity doesn't yet cover the cost of installing the manure processing system at Kluthe's farm.
"We think it's going to take some government incentives," said A.L. Goldberg of Iowa's Department of Natural Resources. "The startup costs are just too high now."
The federal government and some states have handed out grants to build more than 100, including Kluthe's, across the country - although none in Kansas and Missouri.
In fact, they're less attractive to Midwestern farmers, who typically pay less for energy than in other U.S. regions.
"It so much comes down to what energy policies exist in a state of whether it makes sense to put on the grid," said Chris Voell, the director of the U.S. Environmental Protection Agency's AgStar program.
Many states require that some of a power company's energy come from renewable sources.
Missouri currently requires that less than 1 percent come from renewable sources, but that figure is scheduled to rise to 15 percent by 2021. Kansas has set a target of 20 percent by 2020. Without such requirements, however, utilities are reluctant to buy energy that costs them more than, say, burning coal.
"What we need to do is figure the value of the other benefits," said Kluthe, who said the checks he gets more than offset his farm's utility bills. "What's the cost of getting rid of that odor and being a good neighbor? Or about helping the environment? You put everything together and it starts to make sense."
Stockton Record
Terrifying tumble will end
With prices down 64% from their peak, homeowners in S.J. are worried...Editorial
Homeowners who bought well before the housing bubble started to expand are no doubt nervous over the continued plunge of San Joaquin County home prices.
In January, a median-priced home in the county sold for $154,000, a jaw-dropping 64 percent less than when the market topped out in September 2006.
In Stockton, prices have slid even further, to a median of $125,000, a level not seen since 2001.
That means many thousands of homeowners here are upside-down on their mortgages, with the home worth less than the amount owed. Thousands who found themselves in that situation already have lost their homes.
There were 3,400 homes for sale in the county last month, 43 percent fewer than when the sales inventory reached its 6,000-plus home peak in September 2007. Most of those homes, certainly those that are selling, are foreclosure homes. Until those clear the market, there will be no stability and little chance for non-foreclosure homes to compete.
The good news - and there is some - is that the pool of homes for sale seems to be shrinking. At the current sales rate, there is only about a 31/2-month supply of homes, an inventory level that is still a buyer's market. As the inventory drops, pressure should start to build on prices. Should. There are a lot of what-ifs out there.
There has been other good news, too, even in the midst of all the bad. The huge price downdraft has increased affordability. That's made it possible for families to buy that could never afforded a home during the boom years. With more attention being paid by lenders to the credit quality of buyers, it is unlikely we will see a repeat anytime soon of the conditions that fueled the real estate bust.
No-document loans - where income more often was proved by a wink and a nod than a pay stub - have given way to much more stringent qualifying rules, as in you actually have to have a job, be able to prove it and be in a strong enough financial position that you can make the payments. Who would have thought three years ago that we'd get to the point where buyers had to have skin in the game? The answer, of course, is that not enough people thought that until the house of cards collapsed.
This down cycle will end. The supply of foreclosure houses will dry up. Prices will stabilize and then probably start to advance, but it is hoped never again at the blistering, unsustainable pace of the boom years. California's population is expanding, and those people are going to need homes.
Credit crunch takes big toll
Commercial, multifamily projects hit hard...Bruce Spence
The degrading economy and the ongoing credit crunch hammered commercial and multifamily mortgage loan originations in the fourth quarter of last year across the country, according to a new quarterly survey by the Mortgage Bankers Association.
The group's survey of commercial and multifamily mortgage bankers originations indicated that fourth-quarter numbers were down 80 percent year to year across all property types and investor groups. Loan originations for all of 2008 were down approximately 60 percent from 2007 levels.
Commercial brokers in San Joaquin County reported that local loan activity was down similarly, with bank credit tight and would-be buyers leery of all properties except those with locked-in, long-term major tenants. And industrial activity was reported as slow and uncertain.
"Between the worsening economy and the continued credit crunch, lenders are extremely cautious about lending, and borrowers are likely to hold onto the assets and the loans they already have," said Jamie Woodwell, vice president of commercial real estate research at the Mortgage Bankers Association.
The decrease in commercial/multifamily lending activity during the fourth quarter was driven by decreases in originations for all property types.
When compared with the fourth quarter of 2007, the overall 80 percent decrease included a 99 percent decrease in loans for hotel properties, an 82 percent decrease in loans for retail properties, a 76 percent decrease in loans for industrial properties, a 72 percent decrease in loans for office properties, a 62 percent decrease in multifamily property loans and a 47 decrease in health care property loans.
The survey covered loans originated by the association's membership of more than 2,400 companies, including mortgage companies, mortgage brokers, commercial banks, thrifts, Wall Street conduits, life insurance companies and others in the mortgage lending field.
Randy Thomas, a Sperry Van Ness commercial real estate broker in Stockton, said commercial real estate deals these days are "somewhat scarce."
Although local banks are still lending because they didn't take the major risks that the big banks did, credit has dramatically tightened, he said.
"The reason the drop-off was so great is that there were so many inferior loans made, and now banks are looking only for those who have gold-plated balance sheets," he said. "The doors have been shut for the marginal purchaser or investor."
The smart investors are finding buy opportunities with long-term leased tenants already in place, national companies with corporate-guaranteed leases, Thomas said.
"You have to be particular about which company you do business with," he said.
For example, a purchase last fall involved a Modesto limited liability company that bought a 35,000-plus-square-foot warehouselike structure on 31/2 acres on Fremont Street at Highway 99 for $3.85 million.
That site already had a longtime tenant, United Rentals, with eight years left on a long-term lease, Thomas said. And United Rentals is owned by Cerberus Capital Management, a huge player as one of the largest private equity investment firms in the United States, he said.
"This is about the only kind of thing that's moving," he said.
Meanwhile, a new industrial market report by commercial real estate broker Colliers International described the industrial real estate market in San Joaquin County as "slow and uncertain" at the end of 2008.
Corporate demand has cooled for industrial land, manufacturing and warehouse space in a market poised for expansion and growth while the U.S. economy contracts, the report said. An abundance of available buildings plus new construction coupled with little demand to spike the industrial vacancy rate in the county to 12.2 percent for the fourth quarter of 2008, up from 10.5 percent the previous quarter, the report said.
Other conclusions in the survey:
» Construction will significantly slow in 2009. Speculative development in all types of industrial products will evaporate until existing sites are leased or sold down and the market improves.
» Landlords will focus on renewing leases and trying to keep tenants.
» Developer interest in land will be limited.
Gregory O'Leary, senior vice president with Colliers International's Central Valley Industrial Group, said the slowdown in the industrial sector is the proverbial shoe that dropped after a downturn in residential led to another downturn in finance and then another in retail.
"All of this is interrelated," he said
The slowdown in retail sales will cut demand for the big industrial space in San Joaquin County, he said.
"When you look ahead, no one knows how long this downturn will last or when we will hit bottom," he said.
Thomas said he hopes the commercial market will start improving by the fourth quarter of the year, in large part because of federal programs aimed at loosening up the credit system.
Treasury Secretary Timothy Geithner said Tuesday morning that the new administration will aggressively work to fight the financial crisis with programs aimed in part at increasing consumer lending.
The Federal Reserve announced plans to expand a key lending program from $200 billion to as much as $1 trillion, which will be used to boost resources for consumer credit and small business loans. The Fed said the program would be expanded in part to cover the troubled commercial real estate market.
The export slump...Dale Kasler, Home Front
Exports remained a strong segment of California's economy long after real estate, construction and other industries fell apart.
Now exports are faltering, too.
New data from the U.S. census shows exports from California dropped the last two months of 2008 (6.3 percent in November and 13.7 percent in December). Although the full-year numbers were up, those last two months show how the recession is spreading around the globe, said Sacramento international trade expert Jock O'Connell.
"It really started to fall off the ledge in November and continued in December," he said. It didn't help that the dollar began strengthening in late 2008, which made US goods costlier on world markets.
San Francisco Chronicle
State exports turning sour...John Batteiger
California exports rose a solid 7.9 percent in 2008 from the year before, according to data released Wednesday. But the 12-month total masks the dismal performance at the end of the year when, amid the growing economic crisis worldwide, exports shipped from California ports fell 6.3 percent in November and 13.7 percent in December.
California accounted for 11.1 percent of U.S. merchandise exports in 2008, down from its peak share of 15.4 percent in 2000, according to Jock O'Connell, a trade and economics adviser at UC Center Sacramento. The decline was largely due to reduced manufacturing in the state, O'Connell said, but also because the Internet is increasingly being used to transport digitized products such as software, music and videos, and there's no easy way to track downloads.
Water board moves to clean up Bay, waterways...Jane Kay, Chronicle Environment Writer
The heaps of trash ringing San Francisco Bay are so unsightly and threatening to wildlife that regional regulators voted Wednesday to designate most of the shoreline and two dozen tributaries as "impaired" under the federal Clean Water Act.
So far, the bay's pollution spots have been linked to such contaminants as mercury, PCBs and DDT as well as invasive species.
But tons of cigarette butts, diapers, crushed Styrofoam and plastic bottles and bags convinced the San Francisco Bay Regional Water Quality Control Board to vote unanimously to designate the edges of the central bay and the south bay, along with 24 rivers and creeks, as places in need of trash controls.
Until now, Oakland's Lake Merritt has been the only bay waterway designated as impaired because of trash that ruins walks along the shore, despoils habitat and endangers wildlife.
The vote was the first step in putting counties and cities on notice that the U.S. Environmental Protection Agency could impose legal requirements and fines if they don't get rid of the trash. But the listing could also bring resources to aid in the cleanup.
Environmental groups praised the vote as a start in getting cities and counties to reduce trash by eliminating plastic bags and discouraging extraneous packaging as well as capturing street trash flowing to the bay. They also want the regional board to issue storm-water permits to counties and cities that require measurable, enforceable reductions in trash.
"Citizens are shocked when they realize how much trash is in the bay," said David Lewis, executive director of Save the Bay, the nonprofit that has been spearheading an anti-trash campaign over the past two years.
Many of the bay's pollutants are invisible and take a chemistry degree to understand, Lewis said. "But when you see ketchup packets, tennis balls and plastic water bottles, you know it comes from all of us."
On last year's statewide Coastal Cleanup Day, volunteers collected 125 tons of trash from the bay, including 15,000 plastic bags. A 2005 study by the regional board's staff scientists found an average of three pieces of trash along every foot of streams flowing to the bay.
Before the vote Wednesday, some cities and counties said they were concerned about having to pay for trash that comes from elsewhere, while representatives from Vallejo said Rindler Creek has been cleaned up and officials in Oakland said the same about Sausal Creek.
The list of sites recommended for cleanup - including the Petaluma River; Strawberry Creek in Berkeley; Guadalupe River in Santa Clara County and Colma Creek in San Mateo County - will go to the State Water Resources Control Board and the EPA for concurrence. If approved, the EPA would require the region to start regulating trash as an urban pollutant or face heavy fines.
Cities and counties with trashed waterways could avoid state and federal involvement if they succeed in cleaning them up.
State officials hope some of the state water board's expected $50 million in a revolving fund under the federal stimulus package will pay for structures beneath roads that capture trash in storm water, said Bruce Wolfe, executive officer of the regional board.
Wolfe praised cities and counties such as San Francisco and Oakland for banning plastic bags and making efforts to reduce waste around fast-food restaurants and convenience stores. The regional board will place requirements in storm water permits to identify and control trash sources, he said.
The Good, The Bad And The Ugly...Cameron Scott, The Thin Green Line
The results of Grist's 2008 eco hero and villain competition are in, and the winners are:
Bruce Nilles, director of the Sierra Club's anti-coal campaign and SFGreen blogger.
Stephen Johnson, the worst EPA chief ever! Eco-sins include: redacting public record information on toxics, refusing to regulate carbon emissions despite a Supreme Court ruling placing the task squarely within the agency's purview, refusing to even include emissions as a criterion for approving new coal plants, a failed attempt to loosen air pollution regulations near national parks, attempting to loosen regulations governing lead pollution, and on and on.
Who's in line to become 2009's hero? And villain?
New York Times
Ethanol, Just Recently a Savior, Is Struggling...CLIFFORD KRAUSS
Barely a year after Congress enacted an energy law meant to foster a huge national enterprise capable of converting plants and agricultural wastes into automotive fuel, the goals lawmakers set for the ethanol industry are in serious jeopardy.
As recently as last summer, plants that make ethanol from corn were sprouting across the Midwest. But now, with motorists driving less in the economic downturn, the industry is burdened with excess capacity, and plants are shutting down virtually every week.
In the meantime, plans are lagging for a new generation of factories that were supposed to produce ethanol from substances like wood chips and crop waste, overcoming the drawbacks of corn ethanol. That nascent branch of the industry concedes it has virtually no chance of meeting Congressional production mandates that kick in next year.
The decline in fortunes has been extreme for both kinds of ethanol since last summer, when $145-a-barrel oil appeared to shift fuel economics in their favor.
Only months ago, refiners in some regions were buying up as much corn ethanol as they could to blend with expensive gasoline, effectively keeping pump prices down slightly. Meanwhile, investors seemed willing to finance plants to produce next-generation biofuels.
But since the summer, oil and gasoline prices have plunged, while the price of corn, from which virtually all commercial ethanol in this country is made, has remained relatively high. Refiners are limiting their ethanol purchases to a level required to meet federal blending mandates — a level far below the industry’s capacity.
“The ethanol industry is on its back despite the billions of dollars they have gotten in taxpayer assistance, and a guaranteed market,” said Amy Myers Jaffe, an energy analyst at Rice University.
The government’s Energy Information Administration recently projected that the industry would fall short of the targets for expanded use of ethanol and other biofuels that Congress set in a 2007 energy law. “It’s possible we may have to look at the targets again,” said Senator Jeff Bingaman of New Mexico, the chairman of the Senate Energy and Natural Resources Committee.
VeraSun Energy, one of the nation’s largest ethanol producers, has suspended production at 12 of its 16 plants and is planning to sell production facilities. In recent days Renew Energy, Cascade Grain Products and Northeast Biofuels have filed for bankruptcy protection. Pacific Ethanol said it would suspend operations at its Madera, Calif. plant.
Bob Dinneen, president of the Renewable Fuels Association, a trade group, estimated that of the country’s 150 ethanol companies and 180 plants, 10 or more companies have shut down 24 plants over the last three months. That has idled about 2 billion gallons out of 12.5 billion gallons of annual production capacity. Mr. Dinneen estimated that a dozen more companies were in distress.
Ronald H. Miller, the president and chief executive of Aventine Renewable Energy, said, “The economics right now are very poor.” Aventine has suspended construction of one Nebraska plant and delayed completion of a second in Indiana.
This is not how it was supposed to be when Congress mandated in 2007 that refiners blend increasing amounts of ethanol into the country’s transportation fuel supply. The law came at a time when the country’s thirst for gasoline seemed unquenchable, and oil prices seemed only to go up.
In an effort to reduce the country’s dependence on foreign oil and to lower the greenhouse gas emissions that contribute to global warming, Congress mandated a doubling of corn ethanol use, to 15 billion gallons a year by 2015. Congress also mandated, by 2022, the use of an additional 21 billion gallons of ethanol and other biofuels produced from materials collectively known as biomass. The potential materials include corn stubble, wood chips and straw.
Congress hoped that advanced biofuels would overcome the longstanding controversies associated with corn ethanol, including the contention that its production raises food prices. Congress started small, decreeing that industry produce 100 million gallons of advanced biofuels next year and 250 million gallons in 2011. But it is becoming clear that even these modest targets will not be met.
Producing the advanced fuels entails breaking down a tough material, cellulose, that is abundant in corn cobs, wood chips and other biological waste, then converting it to liquid fuel. While scientists have proven it can be done, the cost is still high, and little if any cellulosic ethanol is being produced at commercial scale.
Carlos A. Riva, president and chief executive of Verenium, a company working to produce ethanol from sugar cane waste, said that solving the technological hurdles for this type of fuel was “not a slam dunk.” But he and other executives say they are optimistic the challenges can be overcome, and the 2011 and 2012 targets may be met a few years late.
Small, mostly private companies that go by names like Range Fuels, Poet and BlueFire Ethanol have built pilot plants and hope to move into commercial production. But private investment in advanced biofuels has plummeted since the economy went sour late last year, and it is unclear if the industry can scale up. “Cellulosic ethanol is something that is always five years away and five years later you get to the point where it’s still five years away,” said Aaron Brady, an energy expert at Cambridge Energy Research Associates, a consulting firm.
With gasoline consumption declining even as federal mandates for ethanol are increasing, demand for cellulosic ethanol may be insufficient anyway.
Energy experts project that national gasoline consumption in 2009 and 2010 will be 6 percent or more below the 2007 level, and future ethanol production targets could represent more than 10 percent of gasoline production. Since regulations set a 10 percent blend limit for ethanol in most gasoline, there would be no place for ethanol production to go.
“Without moving the blend wall, there is no future for cellulosic ethanol,” said Jeff Broin, president and chief executive of Poet, a company with interests in corn and cellulosic ethanol.
Automobile manufacturers say most of their cars are not designed to run on higher ethanol concentrations. But the Environmental Protection Agency and the Department of Energy are conducting studies to see if the 10 percent limit could be raised.
Senator Bingaman said he expected those tests to be completed over the next year or so, and he would like to see higher blend levels for ethanol.
“There’s no doubt when we wrote that bill, we did not anticipate the recession we are currently sinking into,” he said. “Exactly what that requires us to do as far as changing the law, I am not clear on yet.”
CNN Money
Foreclosures eased in January
Moratorium sends foreclosure filings down 10% for the month...Les Christie
NEW YORK (CNNMoney.com) -- The frantic pace of foreclosures eased in January, according to a monthly report released Thursday.
Foreclosure filings - default notices, auction sale notices and bank repossessions - were reported on 274,399 U.S. properties during January, down 10% from December, according to RealtyTrac, the online marketer of foreclosed homes. That was still 18% higher than January 2008.
Lenders repossessed 66,777 homes in January. A total of 1,081,395 homes have been lost to foreclosure since the housing crisis hit back in August 2007.
RealtyTrac attributed a large part of the decline to foreclosure moratoriums imposed by mortgage giants Fannie Mae (FNM, Fortune 500) and Freddie Mac (FRE, Fortune 500) as well as other lenders and some states.
"The extensive foreclosure efforts on the part of lenders and government agencies appear to have impacted the January numbers," RealtyTrac CEO James Saccacio said in a prepared statement.
The trend toward foreclosure moratoriums has gained considerable momentum lately.
On Wednesday, the government's Office of Thrift Supervision (OTS) urged OTS-regulated institutions to suspend foreclosures for the principal residences of borrowers until a home-loan modification program is agreed to as part of the Obama administration's Financial Stability Plan (formerly known as TARP).
The plan, which Treasury Secretary Timothy Geithner revealed on Tuesday, devotes $50 billion to foreclosure prevention efforts. Its aim is to reduce monthly payments for at-risk homeowners.
"OTS-regulated institutions would be supporting the national imperative to combat the economic crisis by suspending foreclosures until the new Plan takes hold," OTS Director John Reich said in a prepared statement.
And, during a House Financial Services Committee hearing on Wednesday, chairman Barney Frank voiced his hope that the bank CEOs testifying before the committee would put moratoriums in place that would prevent any unnecessary foreclosures to occur before the administration plan is implemented.
"I would ask all of you now to make sure that we have a moratorium in effect," he said. "Having someone suffer foreclosure because two weeks hadn't gone by for this program [to take effect] would be unacceptable."
Of questionable benefit
Many industry observers question, however, how effective moratoriums have been.
"I think that in some instances, the moratorium gets put to productive use," said Mike Larson, a real estate analyst for Weiss Research. "There are some circumstances - inability to reach borrowers, for example - that delaying foreclosures can help and result in cures for borrowers."
But for the most part, moratoriums just postpone the inevitable. California foreclosure filings dropped following a moratorium that took hold this past September. Total filings there fell from 101,724 in August to just 56,954 in October, a 44% decline.
But the California moratorium only required that lenders speak directly with defaulting borrowers before any foreclosure filings could be issued. That had the impact of delaying filings there by about three months, according to Kevin Stein of the California Reinvestment Coalition. After a few months, those delayed filings started to come back into play and foreclosure notices have been increasing ever since. In January they totaled 76,761.
"We haven't seen any of the moratoriums work on a state level," said Rick Sharga, spokesman for RealtyTrac. "What we see in a huge fall off in foreclosure activity for the length of the moratorium followed by a huge spike. Unless there's a really effective program put in place that will actually cure foreclosures, all moratoriums do is delay them. And that can prolong the housing crisis."
"In most cases, it's just kicking the can down the road," added Larson. "It also asks investors in mortgages to take an even bigger hit as delays just add to their losses. That just makes it more hazardous to the financial community."
Moratoriums do little good for homeowners battered by the economic crisis.
"Considering the staggering number of job losses, it is hard to imagine that there could be any sustainable long-term decline in the number of homes going into foreclosure," said Gail Cunningham, a spokeswoman for the National Foundation for Credit Counseling.
"Even when they were employed, millions of homeowners struggled to make their mortgage payments, and now with household incomes either cut in half or nonexistent, the mortgage problems in this country are likely to escalate."
Hardest hit areas
Nevada once again recorded the highest foreclosure rate in the nation. One of every 76 households had a filing during January. California, with one for every 173, was second; Arizona, one for every 182, was third; and Florida rounded out the top four with one for every 214. Oregon finished a surprising fifth, with one filing for every 357 households.
"It shows the foreclosure problem is starting to creep up the coast," said Sharga.
The 10 worst-hit cities are located in the Sun Belt, with California metro areas leading the way. The Golden State accounted for six of the top 10, with Merced posting the highest rate. It saw a foreclosure filing for one in every 59 housing units - nearly eight times the national average.
Other poorly performing California cities included Riverside-San Bernardino, which was fourth with one in every 81 households; and Modesto, fifth with one in every 84.
Two Florida cities were in the top 10: Cape Coral-Fort Myers was number third, with a rate of one in 80, and Port St. Lucie was ninth, with one for every 123.
Las Vegas posted the second highest rate in January one in 63 and the Reno area was ninth with one in every 128 households. 
Home prices in record plunge
National Association of Realtors reports that home prices dropped a record 12.4% in the final quarter of 2008 - the biggest decline in 30 years...Les Christie
NEW YORK (CNNMoney.com) -- Home prices fell 12.4% during the fourth quarter of 2008, the largest year-over-year decline since the National Association of Realtors began keeping comprehensive records in 1979.
The median price for a U.S. home sold during the fourth quarter of 2008 fell to $180,100, down from $205,700 during the last quarter of 2007.
Prices fell by a record 9.5% in 2008, to $197,100, compared to $217,900 in 2007. In comparison, median home prices dipped a mere 1.6% between 2006 and 2007.
Distressed properties, the foreclosures and short sales that have flooded the market, accounted for 45% of all deals. That has driven sales volume up in Nevada, California and other states hit hard by foreclosures, but these heavily discounted homes have also pushed median prices down.
"People are responding to discounted prices and are slowly absorbing the excess inventory," said NAR President Charles McMillan. "Buyers clearly see value in today's pricing."
Pain is widespread
The vast majority of metropolitan areas, 134 out of 153, recorded price declines compared with the last quarter of 2007.
"Home markets are weak just about everywhere," said Pat Newport, an analyst with HIS Global Insight, "but in a few states, distressed sales are driving transactions."
In Cape Coral-Ft. Myers, Fla., which has the third highest rate of foreclosure filings in the nation, prices fell a devastating 50.8% for the year, to $110,900 from $225,300. That was the most precipitous plunge for any metro area.
In Saginaw, Mich., prices fell 41.4%; Riverside-San Bernardino, Calif., prices dropped 40.8%; and San Jose, Calif., prices declined 37.7%.
The Beaumont-Port Arthur area of Texas bucked the national trend. Its median home price jumped 16.7% to $132,600 - the highest increase in the nation. Other winners included Bloomington, Ill., up 9.6%; Dover, Del., up 6.5%; and Bismarck, M.D., up 6%.
The high number of distressed sales pushed prices down for several reasons, according to Lawrence Yun, chief economist for NAR. For one thing, many sales were in low- and moderate-income housing developments where buyers during the boom years financed their purchases using subprime mortgages. In higher-end areas, fewer exotic mortgages were used.
"Take Orange County, Calif.," said Yun. "It's the lower priced areas there where homes are selling. The high priced areas along the coast are not." As a result, the median home sales price for the area skews lower.
And the high number of foreclosures means banks are willing to slash prices deeply to move inventory. Many of the properties they've obtained through repossessions now sit vacant, soaking up lender money for maintenance, heating, property taxes and insurance. The banks willingly take lower prices to end those cash outlays, which brings down prices even for normal sellers.
Then there's also what Yun calls a "frozen" jumbo-mortgage lending market, which has also slowed sales of higher priced homes and reduced median prices.
The good news is that bargain prices are bringing many new buyers into the market. "Many are first-time homebuyers who were priced out of the market during the boom," Yun said.
Stimulus help
NAR is hoping a piece of the stimulus bill before Congress will build on that momentum and provide an extra incentive for buyers.
"Assuming housing provisions in the economic stimulus package are quickly enacted and provide enough encouragement for homebuyers, we could see a quick lift in home sales for the critical spring home-buying season," said Yun.
On Thursday, it appeared that the final iteration of the homebuyer's tax credit, which had very different provisions in the House and Senate versions of the stimulus package, was shaping up to be closer to the House bill, according to Yun.
That means a credit of $7,500, perhaps $8,000, or 10% of home price for first-time homebuyers. This windfall will not have to be repaid by homebuyers and can be taken off 2008 taxes. NAR estimates that could draw in an additional half million buyers this year.
"It could help reduce the high inventory of homes for sale," said Yun, "and get housing markets moving again. It's hard to get the economy back to growth until that happened."
2-17-09 Merced City Council Redevelopment Agency agenda...7:00 p.m....Tuesday
             3:00 PM
       19 "G" STREET/BNSF RAILROAD CROSSING COMMITTEE –              6:30 PM
          3:00 PM
2-18-09 Merced City Planning Commission meeting...Cancelled
2-19-09 MCAG Governing Board meeting...3:00 p.m.
Mar. 05 - Technical Planning Committee Meeting 
       06 - Citizens Advisory Committee Meeting
       11 - Technical Review Board Meeting
       19 - Governing Board Meeting