LEG ANALYST ANNOUNCES REASONS FOR RESIGNATION

Liz Hill was under no pressure to resign, but said today she is stepping down voluntarily after 22 years as the state's Legislative Analyst. Hill told me by phone today "I've never had a golf handicap and it is probably time to get one." Hill says she will leave her "dream job" later this year, after evaluating California's budget nightmare for more than two decades.

WIDELY RESPECTED

Plenty of praise today from legislators who clearly admired her non-partisan approach to public policy analysis. Senate President Don Perata of Oakland issued a statement saying he "will sorely miss her thoughtful analysis and sound advice." Perata added, "Her dedication to examining the policies - not the politics - of issues was remarkable."

Hill, who recently offered her own budget plan that included closing tax loopholes to raise revenues, said it was simply time for a new chapter in her life to begin. Her husband retired five years ago and at age 58 she indicated she would like to do some traveling overseas. No word yet on who her successor might be. It's up to the Legislature to begin the search and ultimately hire a new analyst after Hill leaves in the fall.

LEG ANALYST LIZ HILL TO RESIGN

For 22 years, she has been the steady ship in a sea of chaos surrounding the Capitol, but today the state's Legislative Analyst Elizabeth Hill is holding a press conference to announce her resignation at the end of the legislative session. Liz Hill is only the 4th person to hold the title of Legislative Analyst in the office's 67 year history and she is widely respected by both Democrats and Republicans for her even keeled approach to reviewing the state budget.



HIGH PRAISE FROM NUNEZ

Assembly Speaker Fabian Nunez of Los Angeles issued a statement today, saying Hill's "thoughtful, non-partisan stewardship of the Legislative Analysts's Office is an example of public service at its best. "



Hill recently took the unusual step of offering an alternative budget plan for legislators to ponder...one that would close many tax loopholes to stem the tide of red ink in California's $16 billion deficit. Governor Arnold Schwarzenegger said Hill's plan included many ideas worth considering (such as closing the $21 million yacht tax loophole) and that lawmakers should take a closer look.

BAY AREA CANDIDATES DOMINATE
Steve Westly is chomping at the bit to be California's next Governor. The former State Controller and Menlo Park businessman is gearing up to make a run for the Democratic nomination for Governor in 2010, after an unsuccessful campaign in 2006. Westly lost the Democratic primary that year to former Treasurer Phil Angelides, who ultimately was crushed by Arnold Schwarzenegger.

Westly told me he believes he's one of only three people who can win in 2010 - the other two he says are Attorney General Jerry Brown of Oakland and Insurance Commissioner Steve Poizner, a Republican from Los Gatos.

IN HIS OWN WORDS
At first Westly was a bit coy about making a formal declaration saying, "Well first my son's tee ball team is undefeated and I'm coaching the team and we want to keep it that way." Then he added, "But I'm keeping my options open, I will come back to Sacramento in the future. I will continue to say involved in California politics."

There's little doubt amongst political insiders that Westly has his eye on the prize. Right now Westly is working with Governor Arnold Schwarzenegger in trying to generate nearly 700,000 valid signatures for a November ballot measure that would create an independent commission to draw up legislative districts. Redistricting reform may not be sexy, but it keeps Westly in the limelight. Westly says he's also the California co-chair for Obama for President. And no doubt he's hoping those ventures will help him capture the media attention he needs to mount another run for Governor.

Most insiders see Jerry Brown as the prohibitive favorite to win the Democratic nod in 2010, while Poizner is considered to be the heavyweight in the GOP.

JUMPIN' JACK FLASH IT'S A GAS, GAS, GAS

At nearly $4 a gallon, Bay Area motorists are already paying among the highest prices in the nation for gasoline....and it's very possible they could be paying even more.

Several Bay Area Democrats have sponsored a bill that could ultimately raise gas prices by as much a 10 cents a gallon more for the next 25 years.

Jared Hoffman (D), San Rafael Assemblyman is the principal author of the bill (AB 2744) that would authorize the Metropolitan Transportation Commission to impose the fee on each gallon of fuel you buy. The extra fee must be approved by the voters in 9 Bay Area counties.

FIGHTING GLOBAL WARMING

So who wants to pay more for gasoline? Jared Huffman thinks Bay Area motorists will approve the fee, once they realize the money goes to combat global warming. In a telephone interview today, Hoffman told me, "Nearly 70% of Bay Area commuters drive to work alone." The benefits of higher gas fees says Hoffman, would be to reduce traffic congestion and to increase public transit options, as well as promoting walking and bicycling. The measure is likely to pass through the Democrat-controlled legislature, since it requires only a majority vote, but faces a potential roadblock in Governor Schwarzenegger, and ultimately Bay Area voters who may balk at paying even higher prices at the pump.

Names Top Endorsers
Embattled SF State Senator Carole Migden has rolled out a list of high-powered endorsers for her re-election bid this June. The list includes California's two U.S. Senators, Barbara Boxer and Dianne Feinstein according to Migden's Web site, http://www.carolemigdenleading.com/.

State Treasurer Bill Lockyer is also on the list, along with Senate President Don Perata of Oakland and nearly two dozen other Democrats in the Senate.

Migden is in a tough fight with two primary opponents, SF Assemblyman Mark Leno and former Assemblyman Joe Nation, who represented Marin County, before he was termed out in 2006. Leno recently scored the endorsement of SF Mayor Gavin Newsom and told me by phone he's also supported by SF District Attorney Kamela Harris. "The momentum of the campaign is terrific," Leno says.

POLITICAL FISH
San Francisco Assemblyman Mark Leno has landed one of the biggest fish in the San Francisco Bay in his race to unseat Carole Migden for her Senate post. San Francisco Mayor Gavin Newsom has announced his endorsement of Mark Leno. The Mayor's office confirmed for me, His Honor made it official Wednesday night in an event before more than 1,000 people at the Herbst Theatre on Van Ness Blvd.

WHAT IT MEANS
Mark Leno can now count on "the Mayor's ability to raise money and to stump for Mark", according to Eric Jaye, chief political strategist for Gavin Newsom. Jaye told me by phone today, it also means "more people on the street, more emails and more money for Mark Leno".

Gavin Newsom scored a decisive re-election victory (74% margin in a field of 11 candidates) in the race for Mayor last November, so his endorsement paves the way for the city's Democratic machine to line up behind Leno. Ultimately, it means extra support, momentum and political clout for the Assemblyman in a very competitive battle for the Migden seat.


THREE WAY RACE
There's a third candidate in the race to capture Migden's seat...it's former Assemblyman Joe Nation. Nation represented Marin and southern portions of Sonoma County as a Democrat Assemblyman from 2000, until he was termed out in 2006. He's considered to be a tough competitor, having served in Sacramento before.

TIGHT RACE
Political insiders project this election race to go down to the wire.
"We can expect this race to be won by just 2 or 3 points" Eric Jaye told me today. The primary election is set for Tuesday, June 3.

MENDELSOHN JOINS PR FIRM
Adam Mendelsohn, the Deputy Chief of Staff and Communications Director for Governor Arnold Schwarzenegger, is leaving. He'll be joining Steve Schmidt, who ran the Gov's re-election campaign in 2006, at Mercury Public Affairs, with offices in Sacramento, Orange County and Los Angeles. Mendelsohn will be Managing Director for Mercury, according to the firm's press release.

Mendelsohn was a key strategist for the Governor, the guy behind the scenes who crafted communication messages for the Schwarzenegger press office. He won't be far from the political scene, as Schmidt is now a senior advisor to Senator John McCain's presidential campaign. Mendelsohn will be replaced in the Governor's Office by Matt David, who also worked with Schmidt on Schwarzenegger's 2006 re-election campaign. Matt David was also briefly part of McCain's presidential campaign last year.

NEW SPEAKER LIKELY TO BE FROM SOCAL


Assemblywoman Fiona Ma of San Francisco and Assemblyman Alberto Torrico of Fremont are both in the running for Speaker of the Assembly, now that current Speaker Fabian Nunez of Los Angeles has called for a Democratic caucus election on March 11th. Political insiders at the Capitol tell us neither one is likely to get the nod.





VICTIMS OF GEOGRAPHY

The reason has nothing to do with qualifications, but rather geography.

You see now that Darrell Steinberg of Sacramento has been named as new leader of the Senate when Don Parata of Oakland leaves in November, the chances of another Northern California legislator getting the Assembly Speakership has dropped to near zero.

It's an unwritten rule at the Capitol that the top two leadership positions are shared between Northern California and Southern California. As a case in point - look at the current leadership - Perata is from Oakland and Nunez from L.A., so lawmakers believe that gives the Legislature geographic balance.

That means Ma and Torrico are victims of geography, because the Assembly seems destined now to pick a leader from L.A....and there are plenty of candidates, including Karen Bass, Kevin De Leon, Mike Feuer, Anthony Portantino, Hector De La Torre and Charles Calderon.

FESTIVITIES SET FOR FEB 13
Mexican President Felipe Calderon Hinojsa will pay an official visit to Sacramento next Wednesday, to address a joint session of the California legislature. It's the highlight of his visit to the U.S., which includes a swing through five cities.

It will be Calderon's first official visit to the U.S. since he was sworn in as President in December 2006. While here, Calderon will meet privately with Assembly Speaker Fabian Nunez then join Governor Schwarzenegger for lunch.

This is not the first time a president of Mexico has spoken before the California legislature. Calderon's predecessor - President Vincente Fox - spoke to a joint session of the California legislature back in May 2006.

LENO WANTS STATE HOLIDAY
San Francisco Assemblyman Mark Leno plans to introduce a bill at the Capitol honoring Harvey Milk with a state holiday. Milk was one of the very first openly gay elected officials in the nation and he was gunned down thirty years ago in San Francisco, along with Mayor George Moscone.

The holiday would be a "non-fiscal" one, meaning state employees would not get a paid day off, according to Leno's Chief of Staff, Bob Hartnagel. In a phone conversation today, Hartnagel told me the holiday would "raise awareness" about Harvey Milk, who lived in San Francisco's Castro District and is today considered by many to be civil rights pioneer. The holiday might serve as a launching pad for discussions in school about Harvey Milk, according to Hartnagel.

The holiday, if approved, would be on May 22, Harvey Milk's birthday.