U.S. Mining Bank Transfer Data in Anti-Terror Effort -- The U.S. government, without the knowledge of many banks and their customers, has engaged for years in a secret effort to track terrorist financing by accessing a vast database of confidential information on transfers of money between banks worldwide. Josh Meyer and Greg Miller in the Los Angeles Times -- 6/22/06

San Jose Mayor Ron Gonzales and budget aide Joe Guerra arrested -- San Jose Mayor Ron Gonzales and his top budget aide Joe Guerra were arrested and released by the Santa Clara County Sheriff's department this morning, according to Deputy Sheriff Serg Palanov. Although the grounds for arrest were not immediately known, it came amid a civil grand jury investigation related to the two men's behind-the-scenes actions from 2000 to 2005 to help Norcal Waste Systems get an $11.25 million contract amendment after it underbid the labor component of its winning bid to collect trash for 155,000 San Jose residents. Deborah Lohse and Sean Webby in the San Jose Mercury -- 6/22/06

Doolittle's wife banked more than $66,000 from Abramoff's firm -- Rocklin Republican Rep. John Doolittle's wife was paid $66,690 by Jack Abramoff's firm for event planning work, according to a report by a Senate committee Thursday. ERICA WERNER AP -- 6/22/06

Feds seize reporters' communications in BALCO probe -- E-mails seized by federal authorities identify the convicted founder of the Bay Area Laboratory Co-Operative as a source in the San Francisco Chronicle's reporting on the steroids scandal, according to an online court filing that accidentally revealed confidential information. DAVID KRAVETS and PAUL ELIAS AP -- 6/22/06

Special Election Reimbursement: Not Yet -- Under the headline "interesting but largely unnoticed news" this week, Senate Democrats balked at a plan to reimburse counties for the cost of the 2005 special election called by Governor Schwarzenegger. John Myers KQED weblog -- 6/22/06

California highlights U.S. oil import dependence -- Just two Arab countries have supplied more than 50 percent of California's imported oil over the past five years, a dependence that leaves the state more vulnerable than the rest of the country to disruptions in the world oil markets. TAREK EL-TABLAWY AP -- 6/22/06

California Prison Guards' Power Called 'Disturbing' -- A federal investigator says the governor has backpedaled on reform by giving too much power to the union. Jenifer Warren in the Los Angeles Times Mark Martin in the San Francisco Chronicle Andy Furillo in the Sacramento Bee SORAYA SARHADDI NELSON in the Orange County Register Don Thompson AP -- 6/22/06

Tribe's trip funding scrutinized -- An area Indian tribe that hired Jack Abramoff, a lobbyist later convicted of fraud charges, paid for three congressional staffers to visit the reservation during the same time period, according to federal travel records. MICHELLE DeARMOND and CLAIRE VITUCCI in the Riverside Press -- 6/22/06

Lawmakers' Profits Are Scrutinized -- In all three cases, Hastert and Reps. Ken Calvert and Gary Miller say that they were securing funds their home districts wanted badly, and that in no way did the earmarks have any impact on the land values of their investments. Jonathan Weisman in the Washington Post -- 6/22/06

Deal Puts Mayor on Verge of Major School Control -- Villaraigosa, teachers unions agree on a plan to give him power but not the sole authority he sought. Lawmakers may consider bill next week. Nancy Vogel, Duke Helfand and Joel Rubin in the Los Angeles Times Aurelio Rojas and Laura Mecoy in the Sacramento Bee -- 6/22/06

Board, parents, Romer say mayor's deal full of holes -- Blindsided by Mayor Antonio Villaraigosa's announcement of proposed school-reform legislation, angry LAUSD board members, the superintendent and parents vowed to fight it and said too many questions are unanswered. NAUSH BOGHOSSIAN in the Los Angeles Daily News -- 6/22/06

Day Of Compromise In The Capitol -- Yesterday turned out to be the Capitol’s day of compromise, as Los Angeles Mayor Antonio Villaraigosa compromised with the California Teachers Association on governance of the troubled LA Unified School District, the court-appointed special master reported that Governor Arnold Schwarzenegger is letting the prison guards union resume its sway over the state’s troubled prison system, and several sources indicated that Schwarzenegger will let his bid to increase spending on county-run health programs that include illegal immigrant children go in order to get support for his state budget from reluctant legislative Republicans. Bill Bradley NWN weblog -- 6/22/06

Prop 36: Drug law snared in budget negotiations -- Ideological rifts are dominating negotiations as legislative leaders from both parties rewrite Proposition 36, the voter-approved ballot initiative that requires treatment instead of prison for first-time drug offenders. John Howard and Anthony York in Capitol Weekly -- 6/22/06

Angelides' BBQ poses ethical dilemma -- The latest Angelides 2006 platform plank seems to be ... chicken and ribs. State Treasurer and Democratic gubernatorial candidate Phil Angelides' invitation of political reporters to an off-the-record backyard barbecue may just be modern campaign politics, but it could be ethically sticky for journalists, experts say. Josh Richman in the Oakland Tribune -- 6/22/06

Schwarzenegger's election-year olive branches -- Just six months ago it would have been almost inconceivable that the state's powerful prison-guards lobby would back Gov. Arnold Schwarzenegger's bid for re-election. Shane Goldmacher in Capitol Weekly -- 6/22/06

Governor pushes for a border bill -- Standing beside a tall metal fence along the U.S.-Mexico border Wednesday, Gov. Arnold Schwarzenegger criticized House Republicans for delaying immigration legislative plans, and said it would be "totally inexcusable" if the federal government does not enact changes this year. Kevin Yamamura in the Sacramento Bee Philip J. LaVelle in the San Diego Union-Trib -- 6/22/06

Border Battle Now a GOP Turf War -- House Republicans take on the president with their plan to hold public immigration hearings. Janet Hook and Peter Wallsten in the Los Angeles Times -- 6/22/06

Feds urge judge: Force reporters to reveal source -- Federal prosecutors asked a judge on Wednesday to order two Chronicle reporters to identify who provided them transcripts of grand jury testimony about star athletes' use of performance-enhancing drugs, saying they have no legal right to withhold the information. Bob Egelko in the San Francisco Chronicle -- 6/22/06

ID chips for schoolkids -- Citing privacy fears, a Bay Area state legislator is trying to ban the use of tiny chips embedded on identification badges as a way to keep track of schoolchildren until better ways are found to keep information on the chips secure. Greg Lucas in the San Francisco Chronicle -- 6/22/06

Latest bid in battle for Mount Soledad cross is rejected -- A three-judge panel of the 9th U.S. Circuit Court of Appeals declined yesterday to step in and suspend a $5,000 daily fine that a federal judge will impose on the city if the cross isn't removed from city property by Aug. 1. Onell R. Soto and Craig Gustafson in the San Diego Union-Trib -- 6/22/06

Bill would OK horse race slots at state tracks; tribes object -- Missed plunking down a bet on Seattle Slew, Ferdinand, War Emblem or Funny Cide? A San Francisco assemblyman has introduced legislation that would use today's technology to wager on yesterday's races. Michael Gardner in the San Diego Union-Trib Dan Morain in the Los Angeles Times -- 6/22/06

Using victim's names will only go so far -- Megan's Law. Amber Alert. Jessica's Law. The trend of naming new laws for young people who were victims of actions that would be outlawed or regulated began as a trickle about a decade ago, and it has now become all the rage in politics. VIC POLLARD in the Bakersfield Californian -- 6/22/06

Lots of gay Assembly candidates--on the GOP side -- If you're looking for a gay candidate to vote for in this fall's California legislative races, there are several out there. But they're more likely to be Republicans than Democrats. Malcolm Maclachlan in Capitol Weekly -- 6/22/06

Judge May Deny Bid to End NSA Suit -- The federal government has claimed 'state secrets privilege' in seeking the dismissal of a rights group's domestic spying case against AT&T. Joseph Menn in the Los Angeles Times -- 6/22/06

AT&T Revises Privacy Policy -- Revising its privacy policy, AT&T Inc. said Wednesday that personal account information was owned by the company and might be shared with authorities to investigate "potential threats." Bloomberg -- 6/22/06

Senate Republicans Block Boost in Minimum Wage -- With an eye on midterm elections, Democrats will again try to hike the rate in Congress and in state ballot measures. Molly Hennessy-Fiske in the Los Angeles Times -- 6/22/06

Senators Face Off Over 2 Iraq Pullout Plans -- As elections loom, each party grasps for political favor in debating the Democratic measures. Maura Reynolds in the Los Angeles Times Edward Epstein in the San Francisco Chronicle -- 6/22/06

Political Campaign In Mexico Is Short One Element -- Voters -- So many voters from this parched mountain section of Puebla state have moved to New York that it's become known as "Puebla York." That's put political candidates in a quandary: How do you campaign for votes when the voters are missing? JOEL MILLMAN in the Wall Street Journal -- 6/22/06

Harvard still waiting for Ellison's gift -- One week after Microsoft Chairman Bill Gates announced he would trade in his corporate responsibilities for philanthropic endeavors, Oracle CEO Larry Ellison may be stiffing Harvard University on the biggest gift in the Ivy League college's history. Jessica Guynn in the San Francisco Chronicle -- 6/22/06

Oakland Schools may ask state for millions more -- Oakland district chief considers maxing out line of credit for software fixes, new headquarters. Grace Rauh in the Oakland Tribune -- 6/22/06

Teachers proud of reaching some of hardest students -- Principal Danielle Neves knew opening a new small public school in Oakland would be hard -- just not as hard as Sankofa Academy's first year was. Carrie Sturrock in the San Francisco Chronicle -- 6/22/06

Teacher turned himself and kids around -- The former school hater specialized in making kids into winners through games, action and the fun of learning. ERICA PEREZ in the Orange County Register -- 6/22/06

460 seniors graduate without diplomas -- 7 Orange County districts offering certificates of completion for all requirements but state exit exam. FERMIN LEAL AND ERICA PEREZ in the Orange County Register -- 6/22/06

Passing marks for California stem cell agency -- Outside auditors gave passing marks Wednesday to the California stem cell program in its first annual financial review, but state officials raised fresh questions about their ability to conduct effective oversight in the future. Carl T. Hall in the San Francisco Chronicle -- 6/22/06

San Francisco Mayor boosts health plan as debate widens -- San Francisco Mayor Gavin Newsom began trying to sell his groundbreaking plan to offer health care for all the city's uninsured residents, saying Wednesday he is "absolutely convinced" every county in the nation can do the same. Cecilia M. Vega in the San Francisco Chronicle -- 6/22/06

CalPERS increases HMO rates -- The California Public Employees' Retirement System on Wednesday sidestepped an unpopular proposal for co-payment fee increases and cost-cutting restructuring moves and approved an average 11.6 percent increase in premiums for members of health maintenance organizations. Ryan Kim in the San Francisco Chronicle Gilbert Chan in the Sacramento Bee -- 6/22/06

Water-wars veteran leads Schwarzenegger's EPA -- When Republican Gov. Arnold Schwarzenegger picked Democrat Linda Adams to run the California Environmental Protection Agency, few in the Capitol were surprised. Adams, a veteran of two decades of California's ferocious water politics, is no stranger to politics and pressure. As Cal-EPA secretary, she will see plenty of both. John Howard in Capitol Weekly -- 6/22/06

free rides for Spare the Air Day -- Summer made its annual appearance in the Bay Area Wednesday, and it's off to a hot and smoggy start. Michael Cabanatuan in the San Francisco Chronicle -- 6/22/06

Home prices up, sales down -- The Bay Area real estate market sustained its steady deceleration in May, with a 20 percent drop in the number of transactions while the median price of a single-family home edged to a high of $671,000, according to real estate information firm DataQuick. Kelly Zito in the San Francisco Chronicle Sue McAllister in the San Jose Mercury Eve Mitchell in the Oakland Tribune -- 6/22/06

Middle-class neighborhoods are disappearing -- Ron Miguel, a retired florist and native San Franciscan, can remember when a middle-class family could buy a home in the city without breaking the bank. But over the decades, he has watched that change. Tyche Hendricks in the San Francisco Chronicle -- 6/22/06

Cancer Study Cites Hazards of Indoor Air for N.Y., L.A. Teens -- Survey of students finds health risks for formaldehyde and dichlorobenzene in homes and schools. Marla Cone in the Los Angeles Times -- 6/22/06

Panel OKs opening more coast for drilling -- A House panel approved legislation Wednesday that slashes in half the amount of offshore areas protected from oil and gas drilling while providing states lucrative financial inducements to voluntarily surrender their coastlines to exploration and development. David Whitney in the Sacramento Bee -- 6/22/06

More time sought for flood maps -- A billion-dollar update of the nation's flood maps is exacting a political toll in the Central Valley. In places like Merced, San Joaquin and Yolo counties, developers and community leaders worry the federal government is moving too quickly. Some fear fast-approaching deadlines could leave certain regions more exposed -- not to flooding, but to ambiguity and higher insurance rates. Michael Doyle in the Sacramento Bee -- 6/22/06

Turbulence at Santa Monica Airport -- Surging traffic at the airfield has neighbors feeling besieged. Martha Groves in the Los Angeles Times -- 6/22/06

Oakland City Council backs vast estuary project -- Oakland's shoreline Oak-to-Ninth project, a 64-acre housing development south of Jack London Square that will transform the waterfront into a bustling minicity with parks and shopping promenades, received the City Council's overwhelming endorsement on Wednesday. Christopher Heredia in the San Francisco Chronicle -- 6/22/06

Southern fault's last big quake was in 1690 -- tick, tick -- New satellite evidence has confirmed fears among scientists that seismic stresses are rising along the southern segment of the San Andreas fault system, making the heavily populated Los Angeles area vulnerable to an overdue major earthquake. David Perlman in the San Francisco Chronicle TROY ANDERSON in the Los Angeles Daily News Bruce Lieberman in the San Diego Union-Trib Lee Bowman in the Ventura Star -- 6/22/06

Ordinance outlaws Styrofoam -- The Oakland City Council voted early Wednesday morning to ban restaurants and other food vendors from using polystyrene foam -- more commonly known as Styrofoam -- containers in the city by 2007. Chris Metinko in the Contra Costa Times -- 6/22/06

LA JOLLA, SAN DIEGO COUNTY, San Francisco officials have fast talking to do for Olympics bid -- With the clock ticking, San Francisco officials will have 15 minutes to tell the U.S. Olympic Committee's board of directors why the city should be the domestic choice to bid for the right to host the 2016 Summer Olympic Games. John Crumpacker in the San Francisco Chronicle -- 6/22/06

Military comes clean to mom -- Fellow soldiers knew within minutes on June 22, 2004, that California National Guard Spc. Patrick McCaffrey and 1st Lt. Andre D. Tyson had been killed by supposedly allied Iraqi soldiers who were patrolling alongside them. Army investigators reached the same conclusion in 2005. Henry K. Lee, Matthew B. Stannard, Jim Doyle in the San Francisco Chronicle Brandon Bailey in the San Jose Mercury Mike Martinez in the Oakland Tribune -- 6/22/06

Seven Marines, Navy corpsman charged with murder -- In one of the most serious criminal cases to arise out of the U.S. presence in Iraq, seven Marines and a Navy corpsman were each charged Wednesday with premeditated murder, kidnapping and conspiracy and related charges in the April 26 alleged abduction and slaying of an Iraqi civilian. MARK WALKER, DAVID STERRETT and WILLIAM FINN BENNETT in the North County Times LORENA ANDERSON in the Modesto Bee -- 6/22/06

Local Marines, residents say charges too harsh -- Even though many of the specifics of the allegations have yet to be released by Marine Corps officials, many of those interviewed said they were standing with the troops. "It's not fair because they were in a hostile situation and you can't trust anyone," said Sgt. Chris Janes, who has been to Iraq twice. DAVID STERRETT in the North County Times -- 6/22/06

Mexico labs help Valley users keep doing the meth -- Production of methamphetamine is down thanks to a Valleywide crackdown on secret drug labs and limits on cold medicines that contain pseudoephedrine — but new labs south of the border are keeping supplies plentiful, authorities say. Jim Guy in the Fresno Bee -- 6/22/06

FAA Grounds L.A. Sheriff's Drone Air Force -- Federal officials say the sheriff didn't have the OK for a media demonstration of his surveillance drone. Lynn Doan and Ashraf Khalil in the Los Angeles Times -- 6/22/06

Diocesan Screenings for Abusers Give Slack to Undocumented -- In L.A. and Orange County, illegal immigrant Catholics can volunteer with children without background checks because they lack the required ID. Jennifer Delson in the Los Angeles Times -- 6/22/06

Juvenile Parolees -- Young parolees accused of violating terms of their release are being jailed for months while awaiting hearings to determine their fates, a practice that violates their constitutional right of due process, according to a federal lawsuit filed here Wednesday. Jenifer Warren in the Los Angeles Times Denny Walsh in the Sacramento Bee -- 6/22/06

Housing the Mentally Disabled -- Neighborhood opposition to dumping 'a bunch of undesirables' angers the council, which shelves the project because it isn't family-oriented. Dave McKibben in the Los Angeles Times -- 6/22/06

Activists Settle Civil Rights Suit With Anaheim -- The $50,000 settlement ends a two-year probe into the Police Department on allegations of spying on residents in the late 1990s. The item is in the Los Angeles Times -- 6/22/06

Domestic Violence Inquiry Sought -- After L.A. sees a rise in such incidents but a drop in arrests, the council asks the LAPD to explain how it handles the calls. Patrick McGreevy in the Los Angeles Times RICK ORLOV in the Los Angeles Daily News -- 6/22/06

Orange County Jury Deadlocks on Molester's Release -- Judge declares a mistrial after all jurors but one vote to free Sid Landau. He was one of the first to endure the wrath of Megan's Law. Christopher Goffard in the Los Angeles Times -- 6/22/06

'End Times' Religious Groups Want Apocalypse Soon -- 'End times' religious groups want apocalypse sooner than later, and they're relying on high tech -- and red heifers -- to hasten its arrival. Louis Sahagun in the Los Angeles Times -- 6/22/06

History lands in Yorba Linda -- Helicopter that carried four presidents arrives at its new home at Nixon Library. ERIK ORTIZ in the Orange County Register -- 6/22/06