Another Trump-proofing plank is breaking

Politico

14 hours ago

Presented by
With help from Camille von Kaenel, Will McCarthy, Alex Guillén and Noah Baustin
DEAL OR NO DEAL: The Trump administration is taking away California's backstop Trump-proofing tactic.
The Federal Trade Commission announced an agreement with four heavy-duty truck manufacturers and their trade association Tuesday, declaring California's agreement with them to continue meeting the state's zero-emission sales targets 'unenforceable.'
With that, the Trump administration has kicked out one of the last remaining legs in California's strategy to protect its nation-leading climate regulations — its voluntary deals with industry.
'The Commission's swift action will put the Clean Truck Partnership squarely in the rearview mirror and prevent repeats of CARB's troubling regulatory gambit,' Taylor Hoogendoorn, the deputy director of the FTC's Bureau of Competition, said in a statement.
To recap: The California Air Resources Board signed a deal in 2023 with nine truck manufacturers to abide by California's rules 'regardless of whether any other entity challenges California's authority to set more stringent emissions standards under the federal Clean Air Act' — i.e., in case President Donald Trump returned to power and tried to dismantle the state's special authority to set stricter-than-federal vehicle rules, as he did during his first term (and as he did again in June).
On Monday, prior to the FTC's announcement, the companies ('original equipment manufacturers,' or 'OEMs' in industry parlance) filed a lawsuit in federal court in Sacramento, arguing that they didn't foresee this particular regulatory twist.
'The OEMs are in an impossible position,' Daimler, Volvo, International Motors and PACCAR argued in Monday's suit. 'The OEMs are subject to two sovereigns whose regulatory requirements are irreconcilable and who are openly hostile to one another. Each wields a hammer to enforce its will on industry, leaving OEMs — who simply seek to sell heavy-duty trucks in compliance with the law — unable to plan with the necessary certainty and clarity where their products need to be certified for sale and by which regulatory authority.'
Environmentalists say that argument, which came just days after the U.S. Justice Department sent a cease-and-desist letter to CARB, doesn't pass the smell test.
'The Clean Truck Partnership was designed exactly for a moment like this,' said Adam Zuckerman, senior clean vehicles campaigner with Public Citizen's Climate Program.
CARB declined to comment on the litigation or the FTC's move. But a former CARB official who helped negotiate the 2023 deal said it represents a significant softening of California's regulatory hammer, especially after the loss of its EV sales mandate for light-duty vehicles.
'It's bad,' former CARB Deputy Executive Officer Craig Segall said about the potential impacts to the state's pollution-reduction efforts. 'They're still going to sell some electric trucks, but it's somewhere between bupkis and inadequate.'
It's unclear how the other companies that signed on to the deal — including Cummins, Ford, General Motors and Stellantis — will react after not joining the lawsuit or being named in the FTC announcement. A spokesperson for Hino Motors declined to comment, while the other companies didn't respond immediately to requests for comment. The Truck and Engine Manufacturers Association, which joined the FTC agreement but not the lawsuit, also didn't respond.
California still has one of the companies on its side, at least in the light-duty sector. Stellantis, which inked a deal last year to follow the state's EV sales rules even if they went away, reaffirmed its commitment in June after Trump signed a resolution revoking the EPA waiver California needs to enforce it.
Segall argued that the four truck-makers' retreat from their ZEV commitments won't stop a long-term global trend towards zero-emission models that will benefit California. He said the state still has tools at its disposal, like offering incentives for companies and fleets that buy electric trucks, and excluding those who don't.
'It's not like there's any statute making California buy from these [companies], or any statute requiring it to provide particular incentives to them,' Segall said.
California could put that plan into action soon. State agencies are supposed to deliver recommendations for bolstering the EV market to Newsom's office this week, after the governor signed a June executive order that directed CARB to start developing new regulations and suggested the state offer preferential treatment to companies that continue to work towards electrification goals. — AN
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SPEAKING OF CARB: Congressional Republicans are demanding that the agency hand over documentation on which model year 2026 cars the state has approved for sale, after saying they received reports that California is still enforcing its EV mandate despite it being revoked.
House lawmakers did not include specific details in a letter accusing CARB of continuing to enforce the Advanced Clean Cars II rule but argued that the agency has only certified vehicle models that are compliant with it since the regulation was revoked on June 12.
'Forcing Americans to buy these vehicles would strain our electric grid, raise costs, and increase our reliance on China,' said Rep. Brett Guthrie (R-Ky.), chair of the House Committee on Energy and Commerce. 'Our investigation will look into whether California is continuing to enforce an EV mandate in violation of federal law.'
A CARB spokesperson said the agency is reviewing the letter and declined to comment on it. — AN
NOT OVER TILL IT'S OVER: More than 200 environmental groups urged Gov. Gavin Newsom, Senate President Pro Tem Mike McGuire and Assembly Speaker Robert Rivas to reverse some of their June weakening of the California Environmental Quality Act in a Tuesday letter.
They urged lawmakers to remove the exemption from environmental review of 'advanced manufacturing,' which includes semiconductor factories, and to bolster protections for habitat for protected species. Top lawmakers, including Sen. Scott Wiener, had promised some sort of clean up language when voting SB 131 through in June just days after its introduction, but they have yet to introduce new legislation.
The conservation and environmental justice signatories span the Natural Resources Defense Council to the Asian Pacific Environmental Network to Beyond Plastics.
Six environment-oriented senators also urged McGuire and Wiener to narrow or remove the advanced manufacturing exemption and bolster habitat protections in their own letter last week. — CvK
BACK TO THE BALLOT: A new property insurance showdown is here: A California insurance agent has officially filed a proposed ballot initiative to reimagine how the state regulates insurance.
Elizabeth Hammack, who described herself as the agency principal and owner of an insurance intermediary called Panorama Insurance Associates, submitted the proposed initiative to the secretary of state on Monday.
The long-shot initiative aims to repeal and replace Proposition 103, the 1988 ballot measure that made the Insurance Commissioner an elected position, rolled back auto and property insurance rates and set up public participation in rate reviews and approvals. The proposition has helped keep state's insurance rates below many other states, saving consumers more than $150 billion.
But the property insurance industry has long chafed at the proposition. The record-breaking wildfire losses that spooked some out of the state have amped the stakes, with the insurance industry blaming the proposition for lengthy rate reviews and premiums that haven't kept up with the rising risk.
Consumer Watchdog, the organization that sponsored Prop. 103, had already been preparing for a possible rematch, floating its own possible ballot measure to mandate insurers provide coverage in fire-prone areas.
Denni Ritter, the American Property Casualty Insurance Association's vice president for state government relations, said the organization was 'not involved in drafting this measure' and was reserving judgment until staff had fully analyzed it. — WM, CvK
HAPPY TRACKS: The California Public Utility Commission's top safety boss is riding off into the sunset. Roger Clugston, director of the Railway Safety Division, is retiring after 24 years of public service, the agency announced in a fond farewell.
Clugston launched his career building tracks for the Santa Fe Railroad in the '70s and joined the CPUC in 2001 as a track inspector. He rose through the ranks, helping to launch the first California railway bridge and tunnel inspection programs. He took the helm of the newly organized Rail Safety Division in 2019, which now has 125 employees and is responsible for keeping 10,000 miles of railways safe.
'I came into the CPUC as an entry level inspector and moved up to director, and without a college degree,' Clugston said in a statement. 'You can do anything if you're willing to work hard for it.'
It's unclear who will replace Clugston. The agency is in the process of filling his position, a spokesperson said. — NB
— CalMatters found that the state of California may have to forgive up to 42 percent of the $1.4 billion loan it gave Pacific Gas & Electric to keep Diablo Canyon Power Plant afloat.
— Ford is making a $30,000 fully electric truck in 2027.
— A new study determined that livestock operations contribute to harmful levels of fine particulate matter.