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Politico
27-05-2025
- Politics
- Politico
Nancy Pelosi's midterms mission
Presented by California Environmental Voters THE BUZZ: GROUND GAME — Former Speaker Nancy Pelosi has a go-to line these days to criticize Rep. David Valadao: He could be the 'one vote that cut Medicaid' by backing Republican's megabill to bolster President Donald Trump's domestic agenda. Pelosi, in her post-speaker act as San Francisco's representative in Congress, has made defending federal health care programs her key focus as she tries to help Democrats flip the House next year. She regularly targets battleground Republicans like Valadao — who, as Pelosi will note, 'has close to 500,000 people on Medicaid' in his Central Valley district. About 64 percent of his constituents were enrolled in the program as of last August. 'I know the grassroots of California down to the last blade of grass. These people have made themselves really vulnerable,' Pelosi told Playbook in an extended interview. 'We're not doing this in the San Francisco Bay area, we're doing this in the districts where the Republicans are.' More than a year ahead of the midterms, she's deploying her volunteer army to target GOP members in swing seats, including Valadao, Orange County Rep. Young Kim and Riverside County Rep. Ken Calvert. Pelosi's Save Our Health Care campaign, part of her national PAC, is organizing multiple phone banks per week to target those vulnerable Republicans, and she's raised more than $5.5 million this year to help boost the effort via the DCCC and her campaign committees. Pelosi's team said her volunteer events — including support from the state party and labor unions — have produced 140,000 phone calls to voters in those districts in the last six weeks. Volunteers urge voters to call Republican offices on Capitol Hill to protest proposed cuts to Medicaid, food stamps and other safety-net programs. Pelosi's offensive is part of a volley of attacks Democrats have launched against Republicans over their push to slash safety-net spending. The effort is reminiscent of Democrats' strategy during the 2018 midterms, when GOP efforts to gut Obamacare led to a blue-wave year during Trump's first term (when Democrats flipped 40 seats in the House). Pelosi, who championed the Affordable Care Act and has led a yearslong effort to protect the law, was the architect of the party's successful strategy to flip control of the House that cycle. Pelosi, who was first elected in 1987, hasn't said whether she intends to run for another term in 2026, though she has a committee open. Her allies say her prominent role in Washington's health care fights is clearly driving her decision to wade so heavily into the midterms at this stage of her career. 'She's been the spokesperson on this issue since she walked into the House of Representatives. It's in her blood, it's her,' said John Burton, a former chair of the California Democratic Party who is a friend of Pelosi's. 'She'd no more give up this fight now than jump over the moon.' Pelosi argues a midterm cycle comparable to 2018 is already taking shape and that House Republicans sealed their fate last week when they narrowly passed Trump's budget megabill on a 215-214 vote. The bill's proposed changes to the Medicaid program, including new work requirements, would likely cause millions of recipients to lose coverage. Valadao, Calvert and Kim have argued the bill protects crucial health care benefits for children, seniors, individuals with disabilities and pregnant women, groups that wouldn't be subject to work requirements. Senators are pledging to make major changes to the legislation, and Valadao — who has warned his colleagues against making deeper cuts to the program — has said he plans to work with the Senate to protect Medicaid and food assistance 'for those who need them most.' Valadao, in a statement, argued the bill would achieve that aim 'while rooting out waste, fraud and abuse from bad actors.' But Pelosi says it's outrageous to label food stamps and Medicaid benefits as waste without providing evidence of malfeasance. She also questions the sincerity of California Republicans who've vowed to make changes to the bill: 'They all masquerade, but they all voted for it.' Pelosi said she's comfortable predicting that her successor, Hakeem Jeffries, will be the next speaker. It starts, she added, by capturing voter sentiment early: 'Own the ground, and we will win.' GOOD MORNING. Happy Tuesday. Thanks for waking up with Playbook. You can text us at 916-562-0685 — save it as 'CA Playbook' in your contacts. Or drop us a line at dgardiner@ and bjones@ or on X — @DustinGardiner and @jonesblakej. WHERE'S GAVIN? Nothing official announced. CAMPAIGN YEAR(S) REPUBLICANS FOR … KAMALA — Former Vice President Kamala Harris still hasn't said whether she plans to run for California governor in 2026 (she's given herself until the late summer to make a decision). But Republicans in the Golden State are jonesing for her to get into the fray. As our colleague Jeremy B. White reports, her possible entry is already bringing GOP candidates tactical benefits, allowing them to run against a high-profile adversary who's likely to energize donors and the conservative rank-and-file. A Republican is highly unlikely to be the next governor of deep-blue California. Still, GOP candidates are already treating Harris like their main opponent in interviews, fundraising emails and remarks to voters. 'The candidate who's going to win in 2026, regardless of party label, is the change candidate,' said conservative pundit and author Steve Hilton. 'Kamala Harris is the one who least represents change.' FIRST IN PLAYBOOK: AAPI INFLUENCERS — The National Association of Asian Pacifics in Politics and Public Affairs will today release its '40 Under 40' list of top political operatives and professionals. Playbook got an early peek at the list; among the Californians recognized: Hannah Cho, principal at Athena Strategy Group … Nurges Gheyaszada, chief of staff to state Sen. Aisha Wahab … Kyle Griffith, senior account supervisor at BCFS Public Affairs … Zahra Hajee, senior communications deputy for LA County Supervisor Lindsey P. Horvath … George Hatamiya, senior adviser and comms director for Rep. Doris Matsui … Kayla Hausmann, political director for LA billionaire Rick Caruso … Evette Kim, chief of staff to Irvine Councilmember Melinda Liu … Nikita Koraddi, principal consultant to the state Assembly Appropriations Committee … Uma Krishnan, president of the San Mateo County AAPI Alliance … Alyssa Lee, researcher, UC Berkeley Othering & Belonging Institute … Shine Lee, legislative director for Rep. Young Kim … Callie Lichti, a fellow for Assemblymember Phillip Chen … Kinza Malik, senior government relations manager at Turo … Jaliya Nagahawatte, policy adviser for Rep. Young Kim … Sabina Nussipov, government relations manager at Intuit … Faraz Rizvi, policy and campaign manager at the Asian Pacific Environmental Network … Victor Shi, new media deputy for LA Mayor Karen Bass … Jason Tso, legislative assistant to Assemblyman Phillip Chen … Denise Tugade, legislative staff analyst at the LA County Dept. of Public Health Substance Abuse Prevention & Control Bureau … Lenh Voong, legislative Director for Assemblymember Gregg Hart … Diana Vu, legislative advocate at the Association of California School Administrators … Sakshi Walia, former chief of staff to state Sen. Steve Glazer … Lina Yabuta, account executive at Focuscom Inc. … Justin Yamamura, legislative assistant to Rep. Young Kim STATE CAPITOL SHOW POSTPONED — This year's ticket wars were brought to an abrupt end Friday as the Assembly appropriations committee kicked both bills aiming to rework the events market to next year. Proponents of AB 1349, a suite of rules that would have been applied to resellers such as StubHub and SeatGeek, vented their frustration with the decision while a competing faction highly critical of the country's dominant primary seller, Ticketmaster, celebrated. 'The Assembly was right to delay the bill and focus on real, equitable solutions for consumers,' wrote Empower Fans CA, a coalition that was fighting to impose new rules on Ticketmaster that ultimately saw the rival bill it was supporting watered down and then pushed to next year. The fall of the bills again demonstrated the difficulty of reaching consensus on ticketing issues in California, where the Legislature has for several years in a row been unable to agree on how to balance concerns about Ticketmaster's dominance in the market and third-party sellers' profiting from reselling tickets to popular events at a significant markup. Reps for Live Nation, the parent company of Ticketmaster, meanwhile said the delay in legislating would let 'scalpers off the hook,' alluding to provisions meant to limit software used by scalpers who sell tickets on competing sites. 'Stalling AB1349 lets scalpers off the hook,' said a statement from Live Nation. 'Astroturf groups have tried to fear monger about this bill because they don't want to see bans on deceptive practices like speculative ticketing and fake URLs.' CLIMATE AND ENERGY THE RACE TO REBUILD — Los Angeles is caught between going fast and going far when it comes to rebuilding from January's destructive fires. Former state Sen. Fran Pavley — best known for writing AB 32, the landmark 2006 law that established California's first binding climate targets — will be central to the debate. She's vice chair of the county's 'blue-ribbon commission on climate action and fire-safe recovery.' Read Friday's edition of California Climate for an interview with Pavley about the panel's recommendations. TOP TALKERS STRIKING OIL — Former Los Angeles Mayor Antonio Villaraigosa is pivoting toward the oil industry in his run for California governor. So far, his campaign has accepted $176,000 in contributions from people with ties to the industry, the LA Times reports. Villaraigosa's coziness with fossil-fuel companies comes as a shock to some climate advocates who viewed him as an ally in the past. 'I'm honestly shocked at just how bad it is,' said RL Miller, president of Climate Hawks Vote and chair of the state party's environmental caucus. ICYMI: SUSPENSE RESULTS — The state Assembly and Senate Appropriations committees decided the fate of hundreds of bills last week, including shelving the proposals to regulate the state's ticket market. But they advanced bills to increase wages for incarcerated firefighters, safeguard schools from immigration enforcement and require social media safety warnings. Read more from our colleague Lindsey Holden in Friday's edition of California Playbook PM. AROUND THE STATE — An 11-mile stretch of the Pacific Coast Highway connecting Los Angeles to Malibu has reopened. But repairing the iconic seaside highway has become a costly, never-ending endeavor for Caltrans. (Los Angeles Times) — Fresno Mayor Jerry Dyer announced that the state revoked his city's 'prohousing designation' after it failed to adopt multiple policies to streamline construction in time for a fall 2024 deadline. (Fresnoland) — Multiple investigations into financial mismanagement have recently enveloped San Francisco's Parks Alliance. The nonprofit's troubles have been festering for many years, however. (Mission Local) — Lake Oroville, the state's second-largest reservoir, has filled to capacity for a third year in a row following a moderately wet winter. Just four years ago, drought plunged the reservoir to its lowest level since 1968. (San Francisco Chronicle) PLAYBOOKERS IN MEMORIAM — John Briscoe, a longtime member of the Ocean View School District Board of Trustees, died on May 16 due to complications from open heart surgery. As the Daily Pilot reports, Briscoe served on the board for over 16 years, and he also ran for Congress and the state Legislature on a platform focused on his passion for education. Briscoe was 72. PEOPLE MOVES — Baillee Brown is now head of government and external affairs at Inclusive Abundance. She previously was chief of staff for Rep. Scott Peters (D-Calif.). BIRTHDAYS — former Obama adviser David Plouffe … former Sen. Chris Dodd … rapper André 3000 … BELATED B-DAY WISHES — (was Monday): POLITICO's Rebecca Haase, vice president and general manager states (NY-based) … Amnon Shashua at Mobileye … Mia Shaw … Amir Salehzadeh at Kinetic Strategies … Jared Ficker at Axiom Advisors (was Sunday): former DNC Secretary Alice Travis Germond … (was Saturday): Jodi Hicks at Planned Parenthood Affiliates of CA … Giulia DiGuglielmo in the office of Rep. Darrell Issa WANT A SHOUT-OUT FEATURED? — Send us a birthday, career move or another special occasion to include in POLITICO's California Playbook. You can now submit a shout-out using this Google form.
Politico
23-05-2025
- Business
- Politico
A chokepoint for housing, tickets and tech
Presented by THE BUZZ: TIS' THE SEASON — It's that special time of year in the Capitol when swarms of sweaty lobbyists and even lawmakers have absolutely no clue what's going to happen to their bills — suspense day. Conditions are ripe for the 'suspense file' — from which appropriations committee members quickly approve, reject and amend hundreds of bills with big price tags — to do significant damage. Both chambers' panels killed a higher-than-average percentage of bills in the biannual process last year as they grappled with a massive budget deficit, and the state now has a shortfall for the third year in a row. But many of the legislative fatalities and makeovers coming down the pike will undoubtedly have more to do with policy. Below are a few of the bills we're watching for today: SHOWTIME: A raft of proposed rules targeting event ticket resellers like StubHub and SeatGeek will run into Assembly Appropriations Chair Buffy Wicks, who has expressed concern that pieces of Assemblymember Isaac Bryan's AB 1349 could inadvertently help cement Ticketmaster's monopoly in the market. Wicks voiced that worry about her fellow Democrat's legislation at the last policy hearing on the bill, and only voted for it on the condition that Bryan work with her on amendments as it moved toward her committee. 'I'd like to bring the opposition into those conversations so that we can land on a product that we can all wrap our arms around as it moves forward,' said Wicks, who last year carried an unsuccessful bill aimed at loosening Ticketmaster's hold on the primary sales market. Bryan, a proud concert connoisseur hailed by his colleagues for his packed event schedule, aims to keep prices down through 10 provisions that include banning the use of softwares used by scalpers to purchase tickets en masse against vendors' rules. But a compromise has for years been elusive between factions representing singers, sports teams, venue owners and primary and secondary sellers. Changes today to AB 1349 could determine whether this year is different, assuming the bill survives. Neither Bryan nor Wicks' spokesperson responded to inquiries from Playbook. ANTITRUST OR BUST: Business groups are angling to kill a Democratic-backed proposal from Sen. Melissa Hurtado and Attorney General Rob Bonta that would increase penalties on companies that engage in monopolistic or anticompetitive practices. SB 763 would hike criminal fines under the Cartwright Act, California's century-old antitrust law, for illegal behavior, such as price fixing or restraining trade. Hurtado, who had a similar measure die last year, told Playbook she's exasperated over lobbyists for the California Chamber of Commerce again opposing her effort. 'I would hate for it to have a quiet death,' Hurtado said, asserting that the bill could help lower costs for consumers. The chamber, meanwhile, argues that fines proposed in the bill (up to $100 million for a corporate violation) is excessive and 'would cripple businesses.' HOUSING HUFF: Two bills designed to increase construction of housing are up in the Senate: SB 607, which would overhaul the California Environmental Quality Act to reduce litigation delays; and SB 79, which would allow taller apartment and condo towers near mass transit stops. Both bills are carried by Sen. Scott Wiener, who argues the measures would help California get serious about addressing its vast housing shortage. Some progressive lawmakers and labor unions have lampooned the bills over their lack of affordability requirements, arguing they would largely lead to the construction of luxury housing. Senate President Pro Tem Mike McGuire is the big unknown; Capitol insiders told Playbook that he's considering amendments to scale back SB 607. BOT BATTLE: A couple bills touch on concerns about the potential risks of artificial intelligence. One by state Sen. Jerry McNerney, SB 833, would prohibit AI programs from being given control over critical infrastructure like power plants without human oversight and require good old-fashioned humans to review and implement any plans an AI might dream up. Amendments to the bill include food and agriculture, financial services and other industries under the critical infrastructure definition. The successor to last year's SB 1047, Wiener's SB 53 would cement whistleblower protections for AI workers should they see a program run amok in the lab, and would also create a state AI computing resource dubbed CalCompute. It's a far cry from the international debate Wiener sparked last year with his AI safety bill and has seen broad acceptance in the tech world. — with help from Chase DiFeliciantonio GOOD MORNING. Happy Friday. Thanks for waking up with Playbook. You can text us at 916-562-0685 — save it as 'CA Playbook' in your contacts. Or drop us a line at dgardiner@ and bjones@ or on X — @DustinGardiner and @jonesblakej. WHERE'S GAVIN? Nothing official announced. LOS ANGELES TEST RUN — Billionaire developer Rick Caruso will today deliver the commencement speech at Pepperdine Law School — and excerpts from his prepared remarks offer a window into his potential message if he runs against Los Angeles Mayor Karen Bass again in 2026. While Caruso hasn't said whether he plans to make another bid for mayor, his critiques of Bass' handling of the wildfires has fueled speculation about his plans. Two key lines from his speech, which Playbook obtained early, that could further fuel that chatter: On failed prevention efforts: 'Sadly, this horrifying disaster was avoidable. A week earlier, a wildfire flared near here, providing a clear warning to get prepared. What happened next was a series of tragically mishandled events and failure of leadership at many levels allowing the roaring hell of Jan. 7.' On recovery and rebuilding: 'While our wildfire recovery remains ongoing, I promise you this: We will not rest until the school bells and church choirs ring out again, loud and clear, from Malibu all the way to Eaton Canyon. Indeed, what a godly day that will be. I cannot wait for that day.' A BUDGET, BEGRUDGINGLY — Los Angeles City Council approved a budget for the upcoming fiscal year Thursday afternoon, even though none of the players involved sounded particularly happy about it. 'It's easy to get lost in the details and lose sight of the magnitude of the crisis we're in,' said Councilmember Katy Yaroslavsky, chair of the budget committee, at the start of a marathon hearing. 'It's real, and it will likely only get worse, given what's happening in Washington.' Yaroslavsky chose to accentuate the positive — including 1000 fewer layoffs than Mayor Karen Bass' original proposal — and called the spending plan a 'bare-bones budget that puts us on the path toward fiscal solvency.' The plan passed by a 12-3 vote; among the ayes, notably, was the bloc of progressive councilmembers who had defected in past years over objections about increased police spending. This time, the detractors were the more moderate members, including Councilmember Traci Park, who laced into the city's homelessness spending as a 'taxpayer boondoggle.' 'Frankly, at this point, it's just embarrassing,' Park said. CAMPAIGN YEAR(S) BETWEEN A DOC AND A HARD PLACE — Democratic Assemblymember Jasmeet Bains introduced a resolution to censure California House Republicans for voting for the GOP megabill because it included cuts to Medicaid and food benefits. The move from Bains, a politically moderate physician from the Central Valley, is sure to fuel preexisting chatter that she could challenge battleground Republican Rep. David Valadao. Already, she has been featured in SEIU ads running in Valadao's district pushing him not to cut Medicaid, though she has not said she will run. 'Instead of standing up for us, our Republican delegation sold us out,' Bains said in a statement. 'The Negligent Nine betrayed California, putting loyalty to Trump and their political party above the 40 million residents of the greatest state in the union.' QUICK CASH — Anuj Dixit, a lawyer and the newest challenger to GOP Rep. Ken Calvert, reports raising more than $150,000 in the 48 hours since jumping into the race. Dixit joins an already-burgeoning crop of Democratic contenders for the Inland Empire district, including former OneRepublic bassist Tim Myers and entrepreneur Brandon Riker. CONVENTION EXTRAS NEXT UP — Democratic Reps. Derek Tran, Robert Garcia, Sydney Kamlager-Dove, Dave Min and Jimmy Gomez have been added to the list of officials who will speak at their home state Democratic convention later this month in Anaheim. NEVERMIND, BOYS — A resolution from San Francisco Democratic leaders urging the party to pay more attention to the well-being of men and boys won't be presented at the state party convention next weekend after all. Emma Hare, a vice chair of the county party who wrote the resolution, said she didn't submit it in time for it to be considered at the convention. Nevertheless, the SF Democratic County Central Committee will consider her resolution at its regular May 28 meeting. CLIMATE AND ENERGY ELON'S EXIT — Congressional Republicans dealt Tesla a blow Thursday when they canceled California's nation-leading vehicle emissions rules. Read about the breakup and why Musk might not be pining for lost electric vehicle incentives in last night's California Climate. Top Talkers HIGHWAY TO THE BALLOT — The campaign to recall San Francisco Supervisor Joel Engardio over his role in converting the Great Highway into a park told the SF Standard it has collected enough signatures to put the recall to voters. Engardio championed a successful ballot measure to make the change. Engardio 'ignored our community's needs and kept pushing policies and propositions that hurt us and all San Franciscans,' campaign volunteer Selena Chu said. BUDGET BACKLASH — Foster youth advocates are blasting Gov. Gavin Newsom's latest budget proposal for cutting funding for a helpline for foster families and omitting a request for money for foster family agencies, CapRadio reported. 'We don't think it was appropriate to target such a vulnerable population,' said Susanna Kniffen, a child welfare policy director at Children Now. AROUND THE STATE — AFSCME Local 2620, which represents nearly 5,000 health care and social service workers, created a $1 million strike fund in the latest sign of tensions with their employer, the state. (Sacramento Bee) — A San Francisco supervisor's proposal to more evenly spread homeless shelters throughout the city could prompt Mayor Daniel Lurie's first major policy disagreement with the county board. (SF Chronicle) — Fresno lost its pro-housing designation from the state, which will make it more difficult for the city to access affordable housing grants. (GV Wire) PLAYBOOKERS WEDDING BELLS — Louis Mirante, VP of public policy for the Bay Area Council, will marry Dr. Kanishka Patel, a UC Davis Health oncologist, in a multi-day matrimonial extravaganza over Memorial Day weekend in San Francisco. PEOPLE MOVES — Levi Lall is now counsel at the DOJ's office of legal policy. He previously was counsel for Rep. Darrell Issa (R-Calif.) and the House Judiciary Subcommittee on Courts, Intellectual Property, Artificial Intelligence and the Internet. — Carmen-Nicole Cox has opened The Cox Firm for Law and Policy, offering legal and lobbying services. She was most recently director of government affairs for ACLU California Action and previously served as chief of legislation for the California Department of Corrections and Rehabilitation for Govs. Gavin Newsom and Jerry Brown, and before that as deputy legal affairs secretary for Brown. BIRTHDAYS — author Yaron Brook … comedian Drew Carey … recording artist Jewel BELATED B-DAY WISHES — (was Thursday): Dustin Moskovitz ... Michael Wilner ... Michael Kostroff WANT A SHOUT-OUT FEATURED? — Send us a birthday, career move or another special occasion to include in POLITICO's California Playbook. You can now submit a shout-out using this Google form.
Politico
22-05-2025
- Business
- Politico
Mike McGuire in the housing hot seat
Presented by THE BUZZ: HOUSES DIVIDED — When it comes to housing legislation, Senate President Pro Tem Mike McGuire has increasingly become the outlier of the proverbial three-legged stool of state government in Sacramento. His counterparts — Assembly Speaker Robert Rivas and Gov. Gavin Newsom — have made it abundantly clear this year that they want to go big on measures to accelerate housing construction, including legislation that would slash local restrictions and environmental reviews for new development. But McGuire has been ambiguous about where he stands on the most high-profile housing legislation this session, including a landmark package of bills to overhaul the California Environmental Quality Act (commonly known as CEQA). The pressure on McGuire will grow this week as the Appropriations Committee faces an end-of-week deadline to act on fiscal bills. Several sweeping housing measures are on the potential chopping block — namely Senate Bill 607, which would reduce delays due to environmental reviews for new housing as well as other projects, including transportation and energy infrastructure. Already, business groups and pro-development YIMBY (or Yes in My Back Yard) activists have criticized McGuire after housing bills have faced hiccups getting through Senate committees. Some have gone as far as dubbing the Senate the less pro-housing chamber. 'We'll see where he stands on Friday — that will be very telling,' said Jim Wunderman, president of the Bay Area Council, a powerful business group that's sponsoring SB 607 and other housing bills. 'This is the moment for California to really take the jump here' and address the housing shortage. In a statement to Playbook, McGuire said he's committed to 'working hard to increase housing stock especially in the regions most impacted by shortages, and to build housing faster.' Still, McGuire hasn't ruled out amendments to scale back SB 607, for example — a contrast with Rivas. The speaker has championed a related CEQA-reform measure, Assembly Bill 609, which would exempt most urban infill housing from environmental reviews. The bill sailed through a floor vote this week on a 67-0 vote. Nick Miller, a spokesperson for Rivas, said the speaker is '100 percent behind' both measures to overhaul CEQA. Miller added, 'His message has been clear all year: We need to build more housing. We feel like we have the votes to back it up.' The governor has also upped the pressure on McGuire in recent days. Last week, Newsom announced that he would seek to advance both major CEQA-reform bills through the state budget — a tactic that would circumvent obstacles like hostile Senate committee chairs. It was a rare foray into the legislative process from Newsom, who typically doesn't wade into housing fights until legislation is on his desk. McGuire's allies in the Senate, including Housing Chair Aisha Wahab, are pushing back against the onslaught facing the pro tem. She has derided the CEQA effort as a developer giveaway that won't make housing more affordable or stabilize rent increases for tenants. 'Blanket deregulation may cut costs for developers, but it doesn't guarantee affordable homes for residents,' Wahab said in a text message. Many environmentalists and building trade unions also oppose the effort to reform CEQA, which has typically been a fraught third rail in Sacramento. Sen. Scott Wiener, who's carrying SB 607, has so far succeeded in pushing most of the year's major housing measures through the Senate. But doing so has been a heavy lift already — Wiener has twice been forced to persuade his colleagues to advance bills over the objections of committee chairs, Wahab included. Wiener said critics should be careful not to read too much into McGuire's silence, saying it's common for legislative leaders not to make definitive statements about controversial bills early in the session. 'Don't count the Senate out,' Wiener said, noting McGuire has co-authored several aggressive housing bills in the past. McGuire said Thursday that he looks 'forward to continuing these conversations with the Assembly and the governor.' He also left the door open to putting CEQA reform in the budget. GOOD MORNING. Happy Thursday. Thanks for waking up with Playbook. You can text us at 916-562-0685 — save it as 'CA Playbook' in your contacts. Or drop us a line at dgardiner@ and bjones@ or on X — @DustinGardiner and @jonesblakej. WHERE'S GAVIN? In downtown Sacramento for an 11 a.m. press conference with Attorney General Rob Bonta about California's clean air efforts. Watch here CAMPAIGN YEAR(S) RUNNING IT BACK — Secretary of State Shirley Weber today officially announced she's running for reelection, a move that was expected by insiders but nevertheless closes off another office to Democratic officials planning their next moves. 'With my powerful voice for justice, I fight every day to make sure that eligible Californians can exercise their right to vote, and I will never back down,' Weber said in a statement that also highlighted her upbringing in the Jim Crow South where her parents were unable to vote. Attorney General Rob Bonta, who is also running for a second term, backed Weber in a statement, calling her a 'thoughtful partner against the Trump administration's unlawful attacks on elections.' CONVENTION EXTRAS LINEUP DROP — Sen. Adam Schiff, Lt. Gov. Eleni Kounalakis, DNC Vice Chair Malcolm Kenyatta and labor icon Dolores Huerta are all slated to speak at the California Democratic Party Convention in Anaheim later this month. They round out a lineup that includes Minnesota Gov. Tim Walz and New Jersey Sen. Cory Booker. SAN DIEGO TENT TAKEDOWNS — San Diego Mayor Todd Gloria led his meetings in Sacramento yesterday with a request for homelessness money endorsed by all California's big-city mayors. But he also brought a request having little to do with money: that the state clear more encampments on its own turf. 'Caltrans,' Gloria specified in an interview with Playbook, 'needs to do more.' The leader of California's second-largest city bemoaned the tents that have cropped up around freeways outside his city's jurisdiction. Behind fences dividing city and state territory, he said tents are abundant and causing complaints from his constituents. 'It can be frustrating, as the worst encampments in my city are on Caltrans property,' Gloria said. 'Our relationship with them could be better. It's not for want of trying. There's regular communication. But whether it's lack of resources on Caltrans or lack of will, this is tough stuff.' He empathized with the agency — 'I respect and understand that they tend to be transportation professionals, not social workers' — but said the same applies to municipal governments. 'Cities are not social service agencies either,' he said. CLIMATE AND ENERGY TILL THE STORM BLOWS OVER — California is — conveniently — not expecting to build any offshore wind turbines until after President Donald Trump, who's lashed out against the technology, leaves office. Instead, offshore wind proponents are focused on getting money to upgrade the state's ports to build and ship out the massive blades, when the time is right. Read more in last night's California Climate. TOP TALKERS FED UP — Schiff told EPA Administrator Lee Zeldin that he will cause a litany of cancers at a Senate Environment and Public Works on Wednesday, Fox News reported. 'You could give a rat's ass about how much cancer your agency causes,' he said. LEVI IT ALONE — San Francisco Mayor Daniel Lurie's office has privately suggested that he would gut an ordinance to put at least one behavioral health facility in every supervisor district and prohibit new sites in areas that already have them, the San Francisco Chronicle reports. Lurie, an heir to the Levi Strauss fortune, would rather 'endeavor to' have a facility in every district. AROUND THE STATE — The San Mateo Board of Supervisors will require quarterly reports for all county purchases over $100,000. (Mercury News) — The Sacramento County Board of Supervisors established the Behavioral Health Commission to advise the board on how to improve behavioral health policy and programs. (Sacramento Bee) — In Fresno, if voters do not pass Measure C, they risk losing tens of millions of dollars in road maintenance and expansion for a large portion of the county's transportation projects. (The Fresno Bee) Compiled by Nicole Norman PLAYBOOKERS PEOPLE MOVES — Jon Koriel has joined the firm Bryson Gillette as a director of public affairs in Los Angeles. He was most recently public affairs manager at Comcast California in San Francisco. BIRTHDAYS — State Data Officer Jason Lally (favorite b-day treats: princess cake and gin/elderflower cocktail) … Cassidy Denny in the office of state Sen. Angelique Ashby … Ed Manning at KP Public Affairs … Deputy Superintendent of Public Instruction Abel Guillén … David Schenkein … Jay Carney at Airbnb … Matt Roman … Oren Cass at American Compass BELATED B-DAY WISHES — (was Wednesday): radio journalist Joshua Nehmeh … James Castañeda at the American Planning Association WANT A SHOUT-OUT FEATURED? — Send us a birthday, career move or another special occasion to include in POLITICO's California Playbook. You can now submit a shout-out using this Google form.
Politico
16-05-2025
- Business
- Politico
Gavin v Ron: budget edition
THE BUZZ: SPLIT SCREEN — California and Florida are separated by 2,500 miles, but the states' budget approaches may be even further apart. While California Democrats are painstakingly discussing how to address a $12 billion deficit without slashing programs to the bone, Florida Republicans are racing to cut taxes and spending — enjoying a balanced ledger before an expected shortfall hits next year. Gavin Newsom is blaming the White House's trade policy for his shortfall. In Ron DeSantis' Florida, tariffs — and the budgetary side effects of federal spending cuts — are hardly coming up. The differences between the two governors, who've sparred on Fox News and social media, are well-documented. Ron wears cowboy boots. Gavin wears aviators. DeSantis jeered California on the campaign trail and Newsom's on the presidential bleachers, dreaming about the day when Dems wake up and find what they've been looking for has been there the whole time. But if there's one thing that these longtime nemeses have in common, it's that both of them are dealing with messy, intraparty feuds over taxing and spending as their final terms wind down. Once their parties' hottest governors, DeSantis and Newsom now face the challenge of navigating the fraught divisions without blowing up their own political futures. Newsom angered his health care allies this week, seeking to cap enrollment on undocumented immigrants' access to Medicaid, cut much of Planned Parenthood's funding and incensed labor unions along the way. His main tax proposal, an increased credit for the film industry, hasn't gotten a yay or nay from legislative leadership this early in negotiations, and it's an open question how much rank-and-file Democrats will be willing to offer in tax breaks during a year in which health care access could be cut in the statehouse and in Washington. Things aren't going smoothly in Florida, either, where the legislative session has gone into overtime after lawmakers sailed past an original May 2 deadline. The Florida House, Senate and governor don't agree about what's most important, and the squabbling between leaders has turned bitter and personal. The state House wants to significantly reduce government spending and cut sales taxes — state economists estimate Florida will be $2.8 billion in the red next year without changes and in a nearly $7 billion deficit the following year. Meanwhile, the state Senate wants to prioritize investing in the economic development of rural areas. A deal that came together two weeks ago blew up a week later after DeSantis threatened to veto it. The governor has said for months that reducing property taxes would be the best way to help Floridians' budgets. Now, the state House has pushed its deadline to get the budget done until June 30, right before the new fiscal year starts on July 1. Florida House Speaker Daniel Perez has even offered passing a bare-bones budget to help avoid a government shutdown, though the state Senate has left its June 6 deadline unmoved. GOOD MORNING. Happy Friday. Thanks for waking up with Playbook. You can text us at 916-562-0685 — save it as 'CA Playbook' in your contacts. Or drop us a line at dgardiner@ and bjones@ or on X — @DustinGardiner and @jonesblakej. WHERE'S GAVIN? Nothing official announced. STATE CAPITOL UNLIKELY CEQA ALLIES — It's not often that local governments and YIMBY-aligned lawmakers find themselves on the same side of a Sacramento policy fight. But a bill that would overhaul California's Environmental Quality Act is making for strange bedfellows. Associations representing cities and counties are backing SB607, state Sen. Scott Wiener's bill that would overhaul the law, commonly known as CEQA. In a letter to lawmakers, cities and counties say the measure would reduce construction delays due to environmental reviews and make it tougher for nefarious actors to use CEQA as a guise for litigation aimed at blocking construction of new housing, childcare centers, food banks and other projects. 'Unfortunately, CEQA is often used for non-environmental purposes to either extract concessions from project applicants or by interested parties to stop a project altogether,' the groups wrote Thursday. The letter is signed by the League of California Cities, California State Association of Counties, Rural County Representatives of California and the California Big City Mayors Coalition (which includes leaders of the state's 13 largest cities). It's an unexpected boost for Wiener as he works to push SB607 through a procedural bottleneck in Senate Appropriations next week, against the objections of some progressive Democrats and environmentalists who oppose changes to CEQA. Wiener has, historically speaking, often been at odds with local governments over housing due to his policies aligned with the Yes in My Back Yard (YIMBY) movement. CLIMATE AND ENERGY THIRD RAIL — The candidates vying to replace Newsom are courting labor union support. Read last night's California Climate to see why that's good news for the state's controversial high-speed rail project. CA vs. TRUMP SATURDAY SCHOOL — Southern California union leaders and allies are planning to protest outside SpaceX headquarters in Hawthorne on Saturday, a show of resistance to DOGE and the Trump administration's attempts to abolish the Department of Education and ramp up immigration enforcement in schools. Leaders from the United Teachers Los Angeles, California Teachers Association and Service Employees International Union representing school employees are planning to rally the rank-and-file at the SpaceX building. Coordinated protests are also planned in San Diego, Sacramento, Hanford and San Francisco. Top Talkers TRADE WAR BARBIE— El Segundo-based Mattel Inc. announced that it will raise prices to offset the cost of tariffs along with other major retailers like Walmart, the Los Angeles Times reports. The move upset President Donald Trump, who recently threatened to put a 100 percent tariff on the company's toys. MISSION GRANTED — The San Francisco Planning Commission voted to allow a vacant lot, the site of a deadly 2015 fire in the Mission District, to be redeveloped into a 181-unit apartment building, the San Francisco Chronicle reports. AROUND THE STATE — After an elderly woman was killed by a bear in her Downieville home, state Sen. Megan Dahle and other officials are grappling with how to deal with the black bear population. (Los Angeles Times) — The San Diego City Council updated its franchise agreement with San Diego Gas & Electric, but the changes don't include more funding for a solar equity program. (San Diego Union-Tribune) — Betty Martinez Franco was sworn in Thursday as the first Latina councilmember in Irvine. Her inauguration completes the city's move to a larger, seven-member council. (Orange County Register) Compiled by Nicole Norman PLAYBOOKERS PEOPLE MOVES — Matt Sturges has joined LA28 as vice president of federal affairs, opening and leading the organizing committee's office in D.C. Previously, he served in senior roles at USDOT, as staff director for the House Committee on Transportation and Infrastructure and as VP of external and government affairs at NetJets. — Molly O'Shaughnessy will be EMC's next CEO, replacing Ruth Bernstein, who is staying on as senior principal. BIRTHDAYS — Jodi Seth at Snap … WANT A SHOUT-OUT FEATURED? — Send us a birthday, career move or another special occasion to include in POLITICO's California Playbook. You can now submit a shout-out using this Google form.
Politico
14-05-2025
- Business
- Politico
Not-so-happy deficit day, everyone
DRIVING THE DAY — Gov. Gavin Newsom will propose capping undocumented Californians' enrollment in Medi-Cal as the programs' costs outrace projections, Rachel Bluth reports this a.m. Newsom will also ask lawmakers to fast-track the Delta tunnel project, Camille von Kaenel reports. The project to reroute more water around the Sacramento-San Joaquin River Delta to farmers and cities is part of the governor's revised budget blueprint. THE BUZZ: MAYDAY — Don't get too sentimental. But this morning, Newsom will release his second-to-last May Revision — typically the governor's final public budget proposal before negotiations with legislative leadership. It's bound to be a doozy. The Newsom administration projected in a memo that President Donald Trump's tariffs will cost the state $16 billion in revenue through next fiscal year alone, as we reported yesterday. The result is expected to be a shortfall of at least $10 billion. And that's not counting fiscal years beyond 2026. The state in January had seemingly balanced its ledger heading into the upcoming fiscal year, before tariffs, federal spending cuts and soaring health care costs left budget wonks feeling some type of way about the state's finances. Now, cuts and perhaps accounting gimmicks will have to come into play for the third-straight year as California grapples with another deficit. Newsom will release the plan at around 10:30 a.m., and our reporters will be rifling through its pages, alongside lobbyists and lawmakers checking in on the fate of their budget babies. Ahead of the release, we asked a few members of our bureau where their eyes will be darting first. Here's what they're watching: Drug costs: Newsom just this morning answered looming questions about whether he'd make cuts to the Medi-Cal program for undocumented patients in response to a multibillion-dollar shortfall. But I'm also following the pharmacy part of the Medi-Cal budget. The administration has been signaling all year that it wants to find a way to rein in pharmacy costs, and Newsom made some early budget news by introducing pharmacy benefit regulations. In Washington, congressional Republicans are floating ideas to bring down Medicaid costs by imposing cost-sharing requirements like co-payments. I'm curious if we could see something like that proposed here to bring Medi-Cal costs down, such as pharmacy co-pays. Even a $5 co-pay could be a barrier for people, especially if they have multiple prescriptions. — Rachel Bluth, health care reporter Eyes on the prize: The revised budget proposal is shaping up to be a reality check on how deep the damage from tariffs runs for Newsom's prized tech sector. The state fiscal outlook, previously buoyed by surprise tax hauls from Silicon Valley giants, is closely tied to the day-to-day swings of major tech stocks like Nvidia. The budget could also decide the fate of a $25 million plan for a Silicon Valley chip center. It's a project California fought hard to win, but officials are warning they may lose it if lawmakers pull funding, compelling Trump to reopen the contest. One top Silicon Valley business group tells us it will be scanning the budget to see if Newsom follows through on his push to integrate AI into various government functions. — Christine Mui, Silicon Valley reporter Lifeline for BART: One of the biggest budget requests from lawmakers — $2 billion over the next two years to prop up struggling public transit systems — will now be an even longer shot, given the projected deficit. The proposal, spearheaded by state Sen. Jesse Arreguín, a Berkeley Democrat, and Democratic Assemblymember Mark Gonzalez of Los Angeles, comes as agencies like Bay Area Rapid Transit and the Los Angeles County Metropolitan Transportation Authority warn they could be forced to slash services amid ridership declines, undermining the state's goals of moving away from fossil fuels. — Alex Nieves, transportation reporter No cap? Newsom and legislative leadership (with an assist from Trump) have set the table for a reauthorization of the state's cap-and-trade system, which generates billions of dollars for state coffers. Sacramento observers had expected Newsom to come out with his plan as soon as Monday, but they're still holding out hope for Wednesday. (Read more on what the climate team is expecting in last night's California Climate.) — Camille von Kaenel, environment reporter Higher ed cuts: Newsom dealt a blow to the University of California and California State University systems in January when he proposed an 8 percent budget cut on top of a deferral of over $200 million for both institutions. More than 60 state lawmakers signed a letter in March asking legislative leaders to reject the proposed cuts amid heavy lobbying by both the UCs and CSUs. We'll see if Newsom gives in as the institutions continue to face funding threats from the Trump administration's purging of diversity initiatives in schools. — Eric He, education and budget reporter Homelessness fight: Local governments have limited space to request funding with all the state's red ink. Still, California's major cities and counties face severe problems with homelessness which, they argue, they can't solve themselves. Newsom's January draft budget included no new money for the state's Homeless Housing Assistance and Prevention program, which provides grants for localities to get people into shelter. Newsom argues his administration has already provided ample funding — more than $27 billion in recent years — to help local governments address the twin homelessness and housing crises. Will Newsom hold firm and push local governments to clear encampments using money allocated in prior state budgets? If he does, expect tension between the governor and local officials to amplify in the coming weeks. — Dustin Gardiner, Playbook co-author La La Land: I'll be looking for the fate of two major Los Angeles priorities — the expansion of the state film tax credit and if there will be any help for the city's budget woes. Newsom has made it clear that the former is one of his top priorities, and if he continues to seek $750 million for the incentives (as he first proposed last fall), that would be a major show of support for the industry even as resources are tightening elsewhere in his spending plan. Meanwhile, Los Angeles Mayor Karen Bass has made several trips to Sacramento to lobby for her cash-strapped city. We'll see just how effective that charm offensive was if there's more money for LA in the May Revise — or if the Los Angeles delegation will have to flex its muscle during budget negotiations with the Legislature. — Melanie Mason, senior politics reporter The long game: Even in January, the governor's team anticipated budget shortfalls beyond the upcoming 2026 fiscal year, hinting at cuts to come. As the governor nears the end of his term, will he make the kinds of structural changes needed to avoid saddling his successor with deficits? Or will he balance the budget only through the 2027 fiscal year, risking negative headlines about California's financial situation closer to the presidential primary? — Blake Jones, Playbook co-author GOOD MORNING. Happy Wednesday. Thanks for waking up with Playbook. You can text us at 916-562-0685 — save it as 'CA Playbook' in your contacts. Or drop us a line at dgardiner@ and bjones@ or on X — @DustinGardiner and @jonesblakej. WHERE'S GAVIN? Delivering his budget plan in Sacramento. CAMPAIGN YEAR(S) FIRST IN PLAYBOOK: THE DOCTOR IS IN — It's a day that ends in 'y' so that means GOP Rep. David Valadao is facing pressure not to vote for Medi-Cal cuts. But this particular new ad campaign from SEIU could also be read as a potential preview of a marquee showdown in the Central Valley House seat next year. The ad features Democratic Assemblymember Jasmeet Bains, a family doctor, making a direct appeal to Valadao to vote against cuts to the program. 'I'm trying to see as many patients as I can, because Congress is trying to cut their Medi-Cal,' she says over footage of Bains seeing patients. Her day job as a legislator in Sacramento goes unmentioned. House Republicans have proposed slashing hundreds of billions of dollars from the program, even though they have eschewed some of the more drastic cuts sought by hardliners. Valadao, whose district has the highest percentage of Medi-Cal enrollees in the state, has been a key voice among moderate Republicans warning against steep cuts to the program. The Republican is a political unicorn, managing to win cycle after cycle despite Democrats holding a double-digit registration advantage in his district. The one exception to his win streak: 2018, a wave election during Trump's first term where health care caused major headaches for GOP incumbents. Democrats see a similar dynamic brewing for the 2026 cycle, and Bains, a three-term legislator who still practices medicine, has been floated as a possible challenger who could cause Valadao some real headaches. Bains has not declared any plans to run for Congress. When asked about the SEIU ad, her spokesperson pointed to a recent statement decrying Medicaid cuts. Already Valadao has fielded one Democratic challenger: progressive local school board trustee Randy Villegas, who is running on an unabashedly economic populist platform. Still, the ads, which will run on broadcast for several weeks, by a major player such as SEIU is a notable boost to Bains' profile. The six-figure buy is financed by SEIU California, as well as smattering of its health care and homecare local affiliates. 'Dr. Jasmeet Bains is showing the Valley what strong leadership looks like: standing up for the health care a half million people in CD-22 — 200,000 of them children — rely on to live healthy lives,' said Riko Mendez, chief elected officer of SEIU Local 521. 'While David Valadao sides with extremists rushing through a plan to terminate health care for children, seniors, and veterans in the Valley, Dr. Bains is actively working to save their lives.' — Melanie Mason BACK TO BRASSTRACKS — Katie Porter apparently raised the eyebrows of the State Building and Construction Trades Council when she sounded a critical note on California's high-speed rail project, telling KTLA, 'if it can't get done, then stop' construction. Trades President Chris Hannan, who represents workers building the project, subtly bit back during a California Labor Federation panel Monday. While asking candidates for governor about high-speed rail, he said it could take an electric vehicle 15-plus hours to travel from Orange County (Porter's home) to Sacramento (the site of the event). Porter sided with every other Democratic candidate there by giving a green light to the project in response to a binary question about her support for it. And she told our colleague Jeremy B. White that 'we have to figure out how to build it' in an interview afterward. Beyond a simple yes-no, where do the other leading Democrats think of a project that remains popular with voters but is well behind schedule? Here's what they told Playbook: Toni Atkins is all in: 'High-speed rail is more than clean transit — it's an investment in the communities, small businesses and workers so often left behind. I fought to keep this project on track as a leader in the legislature and will do the same as Governor. I will never walk away from my commitment to creating good jobs, growing our economy, connecting our communities, and building for the future.' Xavier Becerra says he gets people's disappointment: 'I understand the frustration — costs have grown, timelines have slipped, and trust in government has taken a hit. But completing high-speed rail is a test of whether we're serious about building the future, delivering world-class infrastructure, and ensuring California remains a competitive force in the global economy — and I'm committed to seeing it through in a way that works for Californians.' Eleni Kounalakis is all aboard: 'High speed rail is an investment in the future of California. I am committed to getting it done. As Governor, I will work with all stakeholders to push costs down and speed up the timeline.' Tony Thurmond loved the AVE: 'The delays have been beyond disappointing but I still believe this project can work. We need to prove California can build big projects and do hard things — not give into the idea that we can't just because the state has failed to so far. … I have traveled by high speed rail on a trip to Spain and I believe that we can create a version in California that does great things from the standpoint of job creation and supporting tourism and our economy. I believe if things can't be turned around we should be willing to walk away from it, but I believe we can and should turn it around.' Antonio Villaraigosa is looking at the money: 'I don't think candidates should play politics with high speed rail. We need to safeguard local jobs, protect taxpayers, and avoid haphazard decisions that could trigger requirements forcing the state to repay billions in federal funding that we can't afford. As Governor, I'll make sure this project is transparent, meets deadlines, and sticks to a budget.' Betty Yee is focused on the sunk costs: 'I support California staying focused on completing the Merced to Bakersfield segment that is the backbone of the statewide high-speed rail system. To abandon this segment now would not only strand assets under construction but also forgo the potential for economic transformation in the Central Valley with respect to new business and housing opportunities.' TECH TALK A BIT LEAKY — California's utility regulator may have accidentally exposed 'sensitive,' 'confidential,' or 'personal' data of applicants seeking federal funds for internet expansion projects, according to correspondence shared with our colleague Tyler Katzenberger this week. In a message sent to applicants, dated May 8, the California Public Utilities Commission said it may have exposed personal information about some applicants, like emails and phone numbers, as well as other details about their project awards. The telecom companies that applied were vying for the same pot of federal cash. POLITICO Pro subscribers can read more in today's California Decoded. TOP TALKERS PLAY TO PAY — San Jose Mayor Matt Mahan is pushing forward with his proposal to tie part of city councilmembers' pay to their performance, modifying it to now withhold five percent of salaries and pay it back based on how well they meet specific goals, The Mercury News reports. 'I'm very hopeful that San Jose will be the city — as the capital of Silicon Valley — that leads the way in demonstrating what public sector focus, transparency, clear goal-setting, (and) performance management accountability looks like,' he said. RIYADH READER — Dr. Patrick Soon-Shiong, billionaire owner of the Los Angeles Times and biotech entrepreneur, was spotted on Tuesday with Trump during his visit to Saudi Arabia, POLITICO's Will McCarthy writes. The doctor says he and Saudi Crown Prince Mohammed bin Salman have a 'common goal to cure cancer.' AROUND THE STATE — A judge reduced the Menendez brothers' murder sentences, making them eligible for parole. (AP) — Attorney General Rob Bonta is investigating two San Diego County juvenile detention halls, alleging civil rights abuses. (The San Diego Union-Tribune) — California state workers used an AI-generated image of Newsom in a billboard off Interstate 80, saying Newsom's back-to-work order is going to cause more traffic. (The Sacramento Bee) Compiled by Nicole Norman PLAYBOOKERS IN MEMORIAM — Jennifer Barraza Mendoza, former chief of staff to LA Councilmember Kevin de León, died Tuesday morning after a prolonged battle with cancer. She was 37. Among the many roles she held in her career, Barraza Mendoza was organizing director for SEIU Local 99, deputy director for the state Senate Democratic Caucus, a top adviser on De León's 2018 campaign for the U.S. Senate, a principal at Hilltop Public Solutions and served on the campaigns team at the National Education Association. 'Jennifer lived with purpose, led with courage, and never backed down from a fight worth having,' De León said in a statement. 'In a world often marked by conflict and uncertainty, she was a beautiful soul, anchored by conviction, guided by compassion.' PEOPLE MOVES — Josh Escovedo has been named co-managing shareholder of Buchalter's Sacramento office. He was previously a shareholder. — Lathrop GPM has expanded with a new office in downtown Sacramento, marking another milestone in its West Coast growth following the 2024 combination with Silicon Valley firm Hopkins Carley. BIRTHDAYS — Stephanie Estrada of Cruz Strategies … Mark Zuckerberg … former Reps. Mimi Walters and Jackie Speier … Sam Newton … Erwin Chemerinsky WANT A SHOUT-OUT FEATURED? — Send us a birthday, career move or another special occasion to include in POLITICO's California Playbook. You can now submit a shout-out using this Google form.
