Feb 1 2016

Selling Stardom: Talent listing firm is set to settle legal case

Class members who submit a claim form will also be entitled to a share of $611,000, after deductions for legal fees and costs. That could come out to about $130 per person, according to court records. Additionally, about 120 other One Source clients who wanted to cancel their accounts but were denied a refund will get $500 each.

Im glad that I was able to help the people who used this company, said attorney Jeffrey Wilens, who represents Keen. It is discouraging that it is so tough to get a settlement in these kinds of cases and I was glad to get one here.

One Source was the subject of a Times story in December that examined alleged abuses by talent listing services and explored their role in the Hollywood economy. These companies, and others in the business of working with talent, have come under increased scrutiny from state legislators, whove passed at least five laws since 2000 to prevent mistreatment.

Jan 31 2016

Legal aid reforms: Call to reveal cost of proposals rejected

Investigation call

Plans to slash the number of law firms allowed to do criminal legal aid work at police stations and magistrates courts have been dropped, while an 8.75% cut to legal aid fees lawyers earn has been suspended for a year.

Mr Gove said the MoJ had faced too many legal challenges over the plans – it faced 99 separate legal actions over the proposals.

Lawyers had claimed the reforms could damage quality and access to justice.

The proposed cuts – drawn up by former Justice Secretary Chris Grayling – would have reduced the number of solicitor firms awarded duty contracts by about two-thirds from 1,600 to 527.

Asking an urgent question in the House of Commons on Friday, shadow justice minister Andy Slaughter said the abandoned plans were an appalling use of taxpayers money that had presented an existential threat to the legal system.

He added: How much public money and civil service time has been spent on the aborted tendering processes, the court cases and the consultations in the past three years?

Will you refer your own department to the National Audit Office so it can be independently investigated? Will you apologise to the firms which have closed, laid off staff, or cut salaries faced with losing contracts?

Welcomed by profession

Mr Vara replied that all shades of government… if they listen to people and if they feel a decision needs to be changed then they do make that change.

He added: I dont recall previous governments wasting time and effort trying to calculate measures when they have made a change of direction.

So as far as were concerned this is a decision thats been welcomed by the profession, were pleased about that, we want to look forward and move ahead.

Mr Goves announcements were the latest in a series of reversals of policies brought in by his predecessor.

He pulled the UK out of deal to give prisons training advice to Saudi Arabia, having already scrapped the commercial arm of the MoJ that had sought the contract.

Mr Graylings plans for secure colleges for young offenders were dropped, as were previously planned cuts to barristers fees and a scheme to outsource the collection of fines by the courts.

Jan 30 2016

BorderFest Battle Remains In Legal Limbo

An expected ruling today did not come in the latest legal battle over BorderFest. McAllen federal judge Micaela Alvarez once again held off on a request by the BorderFest Association for a temporary restraining order blocking the city of Hidalgo from using the official BorderFest name. Alvarez heard arguments from attorneys for the two sides, but again questioned whether the federal court has jurisdiction.

Alvarez pointed to last weeks ruling in state court which granted Hidalgos request for a restraining order against the Association, and said she needs more time to make a decision. The two sides are suing each other with both claiming to have the trademarked rights to the popular festival. The legal spat began two weeks ago after the Association parted ways with Hidalgo after 39 years and pushed to move BorderFest to McAllen.

Jan 30 2016

Agency Real Estate Investment Trusts vs. Non-Agency Real Estate Investment Trusts

Real estate investment trusts, or REITs, are divided into two main varieties — equity REITs, which invest in properties, and mortgage REITs, which buy pools of mortgage-backed securities. Mortgage REITs are further separated into two types — agency and non-agency.

How mortgage REITs operate
The basic business model of a mortgage REIT is to buy mortgage backed securities (MBS) in order to collect the interest payments from the underlying loans. In order to supercharge their income mortgage REITs tend to use large amounts of leverage (borrowed money) to buy MBS.

For example, lets say that a certain REIT wants to purchase $10 million worth of mortgages, which come with an average interest rate of 4%. It may use $2 million of its own capital and borrow the remaining $8 million at a relatively low short-term interest rate, say 2%. So, it collects 4% interest on the $2 million in mortgages it paid for in cash, as well as the 2% spread between the mortgages interest rate and the cost of borrowing money on the other $8 million.

This is how mortgage REITs can offer such high dividend yields, often in excess of 10%.

Agency vs. non-agency
These terms refer to the types of mortgage-backed securities the REITs can buy. Agency securities are mortgage bonds issued by Fannie Mae, Freddie Mac, or Ginnie Mae — the government-supported agencies that guarantee mortgages. The mortgages represented by these securities are guaranteed by the issuing agency that the principal amount of the loan will be repaid.

Non-agency securities (also referred to as private label MBS) refer to MBS that are made up of mortgage loans that are not guaranteed by one of these agencies. For example, jumbo loans (mortgages above a certain dollar amount) are not eligible to be guaranteed, nor are loans on commercial properties. Non-agency MBS also includes subprime loans, such as those that contributed to the 2008 financial crisis. These securities tend to pay higher interest rates than their agency counterparts, but are subject to default risk in the event that the underlying mortgages stop getting paid.

Risk of a mortgage REIT depends on several factors
As we already mentioned, one of these risk factors is of course the type of mortgages the REIT buys (agency vs. non-agency), but an even bigger risk factor is the amount of leverage used.

Because mortgage REITs rely on short-term borrowing, they are rather vulnerable to interest rate risk. Consider the earlier example of the mortgage REIT that borrows money at 2% to finance mortgages paying 4%, keeping in mind that mortgage REITs borrow money over the short-term in order to get low rates, while the mortgages they purchase will pay the exact same interest rate for 15 to 30 years.

So, if the short-term borrowing rate spiked to 3%, the profit margin is cut in half. If it spikes to 4%, the profit margin disappears entirely. And, if the short-term borrowing rate spikes beyond 4%, well, thats really bad news.

Of course, the actual business of a mortgage REIT is a little more complicated than this. There are ways these companies can protect themselves against interest rate spikes. However, the basic idea of interest rate risk is a legitimate concern for mortgage REIT investors.

The bottom line on mortgage REITs
Mortgage REITs can pay extremely high dividends, but are inherently risky investments, especially during periods of interest rate uncertainty. Before buying shares of any (agency or non-agency) mortgage REIT, its important to know exactly what youre getting into and to not invest with any money you cant afford to lose.

Jan 30 2016

Real estate briefly: CoreLogic completes acquisition of RELS appraisal firm …

New Ventures

Irvine-based data provider CoreLogic has completed its acquisition of RELS, a real estate valuation and appraisal provider based in Minneapolis. CoreLogic previously owned 50.1 percent of RELS and this week bought the remaining 49.9 percent interest from Wells Fargo Bank for $65 million. RELS will now be fully consolidated into CoreLogics financial reporting. The transaction was funded using cash on hand. The RELS deal is the third such acquisition CoreLogic has announced or completed in the past three months. It bought Plano, Texas-based LandSafe Appraisal Services from Bank of America for $122 million on Sept. 30. In December, the company said it was buying Oxford, Miss.-based appraisal tracking software maker FNC Inc. for $475 million. FNC has an office in Costa Mesa.

Anaheim-based Fortune Hospitality LLC has bought Best Western Plus, a 78-room hotel in San Diego County, for $12.4 million or $159,000 per room. Beverly Hills-based Sikand La Mesa Hotel LLC sold the property. The hotel is located at 9550 Murray Drive in La Mesa and has a pool and gym. This is Fortune Hospitalitys first time buying a hotel, according to Atlas Hospitality president Alan Reay.

Irvine-based Investment Property Group announced the sale of a six-unit property at 425 S. Birch St. in Santa Ana. The one-bedroom units sold for $306 per square foot for a total of $960,000. The property has 3,133 rentable square feet. The buyer was a family trust and the seller was a private investor. Both were represented by Property Groups Santa Ana specialist agent, Daniel Chavez.

Consulting and project management firm Relocation Strategies opened an office at 1400 Quail St., Suite 270, in Newport Beach. The new location will help serve the Los Angeles, Orange County and Inland Empire markets. Partners Corey Udkoff and Michael Shapiro will run the office, which will have two to 10 employees. Relocation Strategies operates out of nine locations across the country.

Irvine-based TRI Pointe Group has joined the nonprofit HomeAid Americas corporate partnership program as a national sponsor. HomeAid America helps build housing for the homeless. TRI Pointe, a family of six regional homebuilders, has been working with HomeAid for several years, volunteering time on outreach activities and building projects for the homeless. The company will donate $20,000 per year at the national level.

Send real estate transaction news to Register staff writer Angela Ratzlaff at

aratzlaff@ocregister.com

Jan 30 2016

Media General completes acquisition negotiations with Nexstar for $2.3B deal

Media General, the local TV station operator that is the object of a bidding war among competitors, said Thursday it has completed negotiations to be acquired by Nexstar Broadcasting Group after Nexstar raised its offer price to about $2.3 billion.

Soon after the announcement, Meredith Corp., the media company in Des Moines that also had an agreement to merge with Media General, said it sweetened its offer to Media General shareholders by offering more than $20 per share in near-term value. The offer includes $3.90 per share in cash, one share of the post-merger company, Meredith Media General, per each Media General share (representing $14.94 per share), and proceeds from the sale of Media Generals spectrum in the upcoming spectrum auction by the Federal Communications Commission.

Media General estimates that its spectrum assets could potentially be worth up to $4.29 per share in after-tax value.

Media General hasn’t commented on Meredith’s offer. But the Media General-Nexstar tie-up would create one of the largest local TV station operators in the country, underscoring consolidation in the industry triggered by rising prices for content from networks and technological changes in video delivery.

If If Nexstar can pull off the acquisition, the combined company would own 162 stations in 99 markets. Media Generals integration of Merediths assets would result in a smaller operator of 82 stations in 54 markets.

But Meredith holds a trump card in its battle with Nexstar. In its agreement with Meredith, Media General agreed to not enter into an agreement with another company unless the Meredith agreement has been terminated. Media General said it made several proposals to Meredith to terminate the agreement. The New York Post reported Thursday that Media General offered $60 million to Meredith and the option to buy two of its stations at market prices to sever their agreement, but Meredith CEO Stephen Lacy rejected it.

With Meredith unwilling to accept these offers, Media General can only proceed with Nexstar if the Meredith transaction is not approved by Media General shareholders at a meeting later this year.

Lacy reiterated his intent to uphold its rights. Merediths board of directors still unanimously agrees that the September 8th merger agreement reached with Media General is in the best interests of shareholders, said Lacy.  Enhancing Meredith shareholder value will remain our top priority as we move forward in this merger process.

The bidding war began in September when Media General agreed last September to pay $2.4 billion in cash and stock to merge with Meredith. The deal called for Meredith shareholders to receive $34.57 in cash and 1.5214 shares of Meredith Media General for each share of Meredith.

Shortly after it was announced, Nextar, based in Irving, Texas, made an unsolicited bid to buy all shares of Media General for about $1.9 billion in cash and stock, an offer that was initially rejected by Media General as it had the Meredith agreement in place.

After pressure from some shareholders, Media General changed its mind two months later, announcing that it would enter into negotiations if Nexstar was willing to raise its price.

Nexstars first offer consisted of $10.50 per share in cash and 0.0898 Nexstar shares per each share of Media General. The offered valued Media General at $14.50 per share. The total transaction value was $4.1 billion, including Media General’s debt.

Nexstars latest offer would raise the cash component by a nickel to $10.55 per share in cash, as well as raising the stock component to 0.1249 of a share of Nexstars common stock for each Media General share. Its offer also includes proceeds from the spectrum auction. In total, the deal reflects a value of $17.66 per share plus the value of the spectrum, Media General said.

To get the deal approved, Nexstar said it would agree to sell some TV stations.

Jan 29 2016

Religious freedom, education, gambling bills top 2016 agenda

ATLANTA (AP) Georgia lawmakers return to the Capitol in Atlanta on Monday, kicking off the 2016 legislative session. Heres a look at some of the top issues expected to come up this year.

RELIGIOUS FREEDOM

Debate continued during the legislative break over a returning bill that would forbid government from infringing on a persons religious beliefs unless the government can prove a compelling interest. The proposed Religious Freedom Restoration Act would cover individuals, closely held companies like Hobby Lobby and religious organizations.

It easily passed the Senate but stalled in the House last year after a Republican member of a committee added nondiscrimination language. Supporters of the bill said that would gut its protection for people acting on religious faith.

The bills sponsor state Sen. Josh McKoon spent the summer promoting the bill at Georgia GOP events, including the state partys convention. McKoon acknowledged at a recent panel that perception has become an issue but blamed people on both sides for peddling scenarios with no basis in reality.

We know what this bill is going to do: Provide modest protections for people of faith, he said.

The states business community has boldly come out against the bill. A coalition of about 100 companies, including Coca-Cola, Delta Air Lines, Google and Home Depot, announced this week that its members are committed to a state welcoming for all people, no matter ones race, sex, color, national origin, ethnicity, religion, age, disability, sexual orientation, or gender identity.

The Metro Atlanta Chamber released a study in the fall cautioning that the state could lose a billion dollars or more in tourism dollars if the bill passes.

LGBT advocates fear the religious-freedom bill, if enacted, would allow people to use religion as a cover for engaging in discriminatory behavior based on sexual orientation.

EDUCATION OVERHAUL

Gov. Nathan Deal, entering the second year of his final term in office, plans to focus on overhauling the states education system.

Deal hasnt announced his specific proposals but gave clear instructions to his appointed commission that spent last year studying all elements of Georgias education system, particularly the states system for dividing up dollars to local districts.

The sweeping recommendations sent to Deal in November would allocate money per student, factoring in qualities including poverty, enrollment in gifted or special education classes and grade level. The group also advocated for more flexibility on testing, more support to charter schools and letting students advance grade levels when ready.

But a recommendation that districts set their own pay scale for teachers, rather than using a statewide system based on experience and training, struck a nerve with educator groups.

Deals allies and national education interest groups also are preparing for the November vote on creating a state-run district to take over schools dubbed chronically failing.

Deals school takeover proposal squeezed through the Legislature last year despite opposition from teachers organizations. It requires a constitutional amendment, which voters will consider in November.

CASINOS AND GAMBLING

Casino and horse-racing backers are promoting gambling as a solution to Georgias higher education scholarships funding gap. Demand for the merit-based HOPE scholarship program has outpaced lottery funding in recent years.

Lawmakers met throughout the fall to study the issue and plan a summary report soon.

Casino firms, including MGM, have hired at least 20 lobbyists. Rep. Ron Stephens proposed a constitutional amendment last year that remains active, allowing up to six casinos in certain regions.

Gov. Nathan Deal remains skeptical about gambling expansion, while state Lottery officials warn it could affect their revenue.

Democrats, meanwhile, want any funds from casinos devoted to a new program providing needs-based aid for higher education costs. House Minority Leader Stacey Abrams said details of the Hope 2 proposal still are being developed.

Providing needs-based aid for college completion is the most important priority we can have, Abrams said.

GAY MARRIAGE

State Sen. Greg Kirk plans to introduce a bill protecting government employees who object to same-sex marriage, called the First Amendment Defense Act and modeled on a federal bill. Kirk, a former Southern Baptist preacher, called his bill a more targeted approach to religious liberty, and said he doesnt believe it would prevent same-sex couples from marrying.

Same-sex marriage is the law of the land, Kirk said. But that does not take away from my ability to express my sincerely held religious belief that marriage is between a man and a woman.

House Speaker David Ralston has discussed plans for a bill, known as the Pastor Protection Act, stating that religious officials arent required to perform wedding ceremonies that conflict with their religious views. The bill also would cover religious properties.

It reaffirms in a very clear, specific way, Georgias commitment to honoring the distinction or the wall between church and state, Ralston said.

MEDICAL MARIJUANA

Rep. Allen Peake pre-filed a bill Wednesday allowing state-licensed medical marijuana manufacturers to operate in the state. Peake sponsored legislation approved last year allowing people with certain medical conditions and a doctors permission to legally possess medical cannabis oil. However, the product cant legally be manufactured in Georgia, and its also risky to transport it from states where production is legal. Law enforcement and Gov. Nathan Deal have spoken against in-state production.

TRANSPORTATION CLEAN-UP

Lawmakers expect some efforts to alter last years $900 million transportation package, which included a new $5 per night fee at hotels and motels. Tourism industry groups argue the fee was a surprise, developed by a conference committee of lawmakers in the sessions final days and hurts hotels or motels located along state lines. Some industry representatives also want people who rent out private homes through web-based short-term rental companies like AirBNB to pay the fee.

Jan 28 2016

Glendale real estate stager with background in theater arts wins national …

A Glendale woman whos behind some of the dolled-up photo spreads of homes on real estate websites was recently named among the best in the business.

Betsy Ferguson Wilbur cracked the Top 10 list of the Real Estate Staging Assn.s redesingers of the year recognition. A winner from the 10 finalists will be announced this month.

Jan 28 2016

Education, elections, abortion expected to be big legislative topics

PHOENIX — There’s a twist this year to what has been the perennial big fight at the Capitol over money.

Arizona has too much of it.

And that has lawmakers staking out positions about what needs to be spent and on whom — and how much should be set aside in tax cuts.

The discussion about reducing taxes is virtually certain in the new legislative session, which begins at noon Monday.

In fact, Gov. Doug Ducey said he will fulfill the promise he made during the campaign of proposing a tax cut every year.

But on the heels of years of record cuts to K-12, community college and university funding, proponents — including the governor — are trying to put a different spin on it.

“I would look at it as tax reform,” he said. “Reform is a word that’s used a lot in public policy,” Ducey explained. “To me, it means improvement.”

But the governor is not hiding what direction his reform would take.

“I believe that we should have a lower tax base,” he said.

Democrats are pushing hard to restore much of what’s been cut during the recession, particularly from state aid to public schools.

They acknowledge that voters may approve Proposition 123 at a special election in May, a move that would put an additional $3.5 billion into public schools over the next decade.

They say, however, that’s mainly designed to make up for the failure to provide inflation aid to schools as required by a 2000 voter-approved measure. Anyway, that lasts only through 2025 — and comes down to only about $300 per child per year.

That’s significant because legislative budget reports put state aid per-student at $4,657 in 2007 — and $4,242 now, even before accounting for inflation.

Then there are the universities, which took a $99 million hit this school year.

The argument for restoring some funding is buttressed by the fact that all the cuts made in last year’s budget left Arizona with a $325 million surplus. And with just five months of data this fiscal year, revenues are running about $200 million ahead of forecast.

But it won’t be just the Democrats looking for more money.

While lawmakers have put new dollars into the Department of Child Safety, the agency has so far been unable to wipe out its backlog of “inactive” cases. These are open cases where no social worker or staffer has looked at the file — or looked in on the child — in at least 60 days.

And it is not yet clear whether a healthier economy will mean that enrollment in the state’s Medicaid program will finally stabilize. About a third of the price tag comes from state revenues.

Lawmakers are also being pushed to once again open enrollment into the Kids Care program, a branch of Medicaid that provides health insurance to the children of working poor.

Regular Medicaid covers families up to 138 percent of the federal poverty level, $27,724 for a family of three. Kids Care covers the children up to 200 percent, or $40,180.

New enrollment was halted in 2010 as part of the budget crunch, but the Children’s Action Alliance is urging reversal of that.

TECHNICAL TRAINING

There are two other fights looming over a small aspect of the education system.

Arizona law allows creation of “joint technical education districts.” These are essentially special school districts formed by other districts to offer special programs that may not make sense for any one district to offer.

The idea is to offer career and technical education to provide students who will not be going on to college with skills that could help them get a job after graduation, like cosmetology or welding, often providing them with the necessary certification.

But Senate President Andy Biggs said the programs have blossomed into other areas where there is no career at the end, at least not without further education. One example is law enforcement.

And the state provides additional aid for some programs that may be offered at satellite campuses, even if some of the courses taught, like history, are the same ones offered at regular high schools. Biggs hopes to narrow the focus — and trim what he says are excess and unnecessary state dollars.

JTEDs are already in a defensive position. State lawmakers approved a $30 million cut last session, set to take effect this coming school year. The net effect, according to schools, would be to drop state aid to 92.5 percent of current levels.

Efforts to restore JTED funding and prevent other cuts are likely to be led by members of Biggs’ own party, who see these programs as a viable alternative to forcing all students to go on to college. They are also likely to be backed by the business community, which has been very supportive of having graduates qualified to fill jobs.

A separate battle is shaping up over already-approved moves to fund schools on estimated current year enrollment versus the number of students each had last year. That particularly hurts districts with declining enrollment.

ABORTION, PLANNED PARENTHOOD FUNDING

Social issues could also dominate debate. And these usually start with abortion.

Foes have been working to restrict the procedure since the US Supreme Court first declared in 1973 that women have a constitutional right to terminate a pregnancy, at least in the first trimester.

Unable to outlaw abortion outright, the legislation normally takes the form of creating new hurdles, ranging from waiting periods and ultrasound requirements to what procedures can be used.

The record has been mixed. Federal judges have upheld some limits. But they have repeatedly struck down those they say impose significant — and therefore illegal — burdens on a woman’s constitutional rights.

This year the fight will play out on another level: a bid by some legislators to eliminate all state dollars going to Planned Parenthood.

Both state and federal law prohibit the use of tax dollars for elective abortions. But Planned Parenthood gets some state dollars through the Medicaid program to provide family planning services.

Abortion foes argue that any money to Planned Parenthood effectively subsidizes its abortion services.

A prior bid to deny family planning funds to the organization was struck down by a federal appeals court, which noted that Medicaid regulations allow patients to get their services from any qualified provider.

Despite that, some Republicans are crafting a measure they contend will withstand legal challenge.

Jan 28 2016

Q&A: Founding real estate’s new path to wealth

Q How did you get into this?

A I used to be a real estate attorney in the Bay Area where I represented institutional clients such as public and private REITs (Real Estate Investment Trusts) and large developers. But unlike those well-funded institutions, individual investors dont have the same level of access to quality deals or the massive amounts of capital to invest in cities like San Francisco. I created RealtyShares to level the playing field so that individual investors can get access to quality deal flow across the US

Q How active are you in the Bay Area?

A Weve done apartment buildings in San Francisco and Oakland. Weve done single-family homes in Los Altos and Palo Alto. Its a broad set of deals, mostly cash-flowing, but we also do single family fix-and-flips and at times ground up construction projects.