Trump's high-speed silver lining

Politico

a day ago

Presented by the Stop the Oil Shakedown Coalition.
With help from Camille von Kaenel
UNLIKELY ALLY: President Donald Trump is about to snatch $4 billion away from California's high-speed rail project — and all that's doing is reinforcing Democrats' iron-willed support for the beleaguered venture.
The Trump administration said Wednesday — in the form of a 300-page report — that it's on the verge of nixing Biden-era grants for the planned rail line from Los Angeles to the Bay Area, a conclusion state officials have feared since the president put the project in his crosshairs in February.
Rather than being a death knell for a project that's years behind schedule and has a price tag that's ballooned from $33 billion to as much as $128 billion, Trump's attacks are fortifying state Democrats who hold the purse strings to its largest funding source — cap-and-trade revenues.
'We've seen this coming and we're going to do everything we can to prevent it,' said Senate Budget Committee Chair Scott Wiener. 'Regardless of what happens here, we're committed to making this project a reality.'
It's been a question just how much Democratic support the project would garner during negotiations to reauthorize the state's emissions trading system, as several lawmakers made it clear coming into session that high-speed rail isn't their priority amid finite climate funding.
That uncertainty made its way into the Federal Railroad Administration's report, which, among other arguments, points to the lack of 'long-term stability of cap-and-trade proceeds' as a reason to cancel grants.
But Trump's dual assaults on high-speed rail and cap-and-trade itself lit a fire under Gov. Gavin Newsom, who committed to reauthorizing the program this year after initially waffling on timing and championed a proposal to guarantee the rail line at least $1 billion in funding annually in his budget proposal last month.
Republican lawmakers who've long blasted the project as a waste of taxpayer dollars are taking a victory lap.
'Hopefully, this will be the beginning of the end for high-speed rail,' Rep. Kevin Kiley (R-Calif.) said during a press conference. 'This project needs to be over. It has been the biggest public infrastructure failure in American history.'
Newsom spokesperson Daniel Villaseñor, when asked about Wednesday's news, pointed to the governor's budget press conference, where he doubled down on his support.
'I want to get it done, and that's our commitment. That's why it's still reflected in the cap-and-trade extension,' Newsom said.
Carol Dahmen, the High-Speed Rail Authority's chief of strategic communications, said in a statement that the agency will 'correct the record' on the Trump administration's 'misguided' decision. But she also highlighted Newsom's proposal, saying $1 billion annually will be enough to 'complete the project's initial operating segment' from Bakersfield to Merced.
Democrats' continued backing of high-speed rail also reflects an important reality of California politics: Labor unions can still make or break you.
That's a lesson former Rep. and gubernatorial candidate Katie Porter learned last month, after she bashed the project in a TV appearance before recalibrating at a labor event and saying she wants to 'put people to work, and I want to get it done for Californians.'
A coalition of powerful labor and public government interests announced its cap-and-trade priorities last month, a list of infrastructure projects including high-speed rail. The project has employed nearly 15,000 union workers since construction started in 2015, more than any other infrastructure undertaking in the country.
'The time to double down is now,' said Michael Quigley, executive director of the California Alliance for Jobs, which represents carpenters, laborers, contractors and other construction unions. — AN
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BUZZWORD OF THE DAY: Senate President Pro Tem Mike McGuire put up an impassioned defense of Sen. Josh Becker's big energy bill during a Senate floor debate on Wednesday, calling SB 254 the 'most significant reform we've had on utility profit return that we've seen in decades.'
The bill advanced to the Assembly on a party-line vote of 29-10, but not before heated pushback from Republicans, who pivoted to familiar targets: California's (now-zombie) electric vehicle mandate and other climate rules they say raise prices.
Senate Minority Leader Brian Jones brought up his bill to repeal regulators' changes to the low carbon fuel standard, which he said would raise gas prices but which the Senate declined to advance Wednesday morning.
Becker's sprawling bill is supported by environmental, renewable energy and agricultural groups, but opposed by the Chamber of Commerce and the investor-owned utilities. — CvK
SOLAR FLARE-UPS: The Assembly left rooftop solar advocates fuming after suspending a procedural waiting period for amendments to pass a proposal limiting subsidies to legacy rooftop solar customers Tuesday night.
'My sense is that the momentum was on our side, so why are they rushing this?' said Walker Wright, the vice president of public policy for Sunrun.
The skirmish unfolded after Assemblymember Lisa Calderon amended her AB 942 on Monday to exempt farms and schools, kicking off a procedural one-day notice minimum. Lawmakers approved waiving that procedural rule Tuesday night before sending the measure to the Senate on a 46-14 vote.
Spokespeople for Calderon and Speaker Robert Rivas cast the move as procedural. Arnell Rusanganwa, a top Calderon aide, called the move 'common, especially during major legislative deadlines' in an email. He said the late amendments had been made in the 'spirit of compromise.'
That's not the only solar flare-up this week. On Wednesday morning, the California Supreme Court's seven justices heard arguments from environmental groups who want to overturn the California Public Utilities Commission's 2022 decision to slash payments to new rooftop solar customers, as well as a defense from energy regulators and investor-owned utilities.
They asked the most questions about the CPUC's authority to make decisions — suggesting a possible ruling that could have implications beyond just rooftop solar. — CvK
DON'T LEAVE US: EPA's new West Coast administrator isn't happy with Valero's decision to close its Benicia refinery.
Josh F.W. Cook, whom Trump named Region 9 administrator in March, aired his concerns in an announcement that EPA had reached a $270,437 settlement with the company's Wilmington refinery over federal chemical safety laws, like underestimating the impact a chemical leak could have on neighboring homes and schools.
'I had hoped that Valero would invest in upgrades to their California facilities and stay in business in our state,' Cook said in a statement. 'They will soon shut down at least one California refinery and leave. This will be a huge hit to gas prices in California, Nevada and Arizona.'
Valero hasn't said why it plans to close the Benicia facility. It was the second announced refinery closure in a six-month period, after Phillips 66 said in October that it would close its Los Angeles oil refinery by the end of 2025 due to 'long-term uncertainty.'
But the state's Democratic officials have taken heat over ABX 1-2, a law Newsom signed last year to tamp down gasoline price spikes by requiring refineries to submit fuel resupply plans when they go offline for maintenance. — AN
SABLE RESPONDS: The Texas-based oil company restarting offshore crude oil production in Santa Barbara is a little on the back foot — but not backing down.
Sable got hit with two court injunctions in the past two weeks aimed at stopping its work to revive a pipeline that led to a massive oil spill ten years ago (see our past coverage for more), but doesn't think they'll slow its plans.
'This court decision does not impede Sable's preparations for restarting the flow of oil critical to lowering California's gas prices and stabilizing supply,' said Steve Rusch, Sable's vice president of environmental and governmental affairs, in a statement. He said that the company is in 'full compliance' with a federal consent decree to restart the pipeline approved by a federal judge and 10 state and federal agencies.
At the same time, Santa Barbara lawmakers are making progress in their efforts to block the restart through legislation, though the clock is ticking for them to finalize the bills before Sable's restart is complete.
The Assembly on Wednesday narrowly passed Assemblymember Gregg Hart's AB 1448, which would prohibit the California State Lands Commission from approving new leases for the construction of oil and gas infrastructure and block revisions to existing leases. The vote to send the bill to the Senate: 42-21, just above the 41 minimum. — CvK
APPOINTMENT TIME: Newsom appointed Alana Mathews as deputy secretary of law enforcement and general counsel at the California Environmental Protection Agency on Tuesday. Mathews previously worked for the Contra Costa District Attorney's Office.
And Edward Fenn was named chief of construction at the California High Speed Rail Authority. Fenn was previously vice president of construction management at Brightline West Trains, which is building a high-speed rail line from Southern California to Las Vegas.
— Calistoga is moving off diesel generators to a first-of-its-kind mix of hydrogen fuel cells and batteries for back-up power.
— Climate advocates aren't the only ones trying to bend Hollywood to their message: Enter Leonard Leo.
— Get ready: The South Coast Air Quality Management District is scheduled to vote Friday on whether to phase out gas-powered furnaces and water heaters.