Good morning and welcome to the A.M. Alert!
WHAT WE’RE WATCHING FOR IN NEWSOM’S MAY REVISE
Via Nicole Nixon…
Gov. Gavin Newsom is scheduled to present his revised budget proposal on Friday, including plans to fill a gaping deficit.
Here are a few things we’ll be looking for during his presentation:
1. The size of the deficit.
In January, Newsom predicted a $38 billion deficit, which he admitted was “a little less pessimistic” than the $68 billion projected by the nonpartisan Legislative Analyst’s Office at the time (though he adamantly declared $38 billion was “the number” and chastised the press for repeating the LAO’s estimate as “gospel”).
The governor’s optimism hasn’t exactly borne out though: tax receipts so far this year are about $5.8 billion below expectations. But lawmakers already approved measures to cut the deficit by $17 billion, which will likely make Newsom’s number less scary than it otherwise would have been.
2. Will there be more cuts?
Many Democrats blanched when Newsom proposed cuts to housing and foster youth programs in January. Still, lawmakers are preparing for the worst and all but telling advocates to expect cuts this year. The question is which areas of the budget will bear them.
The state could also stave off deep cuts by raising more revenue. While Newsom has dismissed broad tax increases in the past, some advocates are pushing to raise revenue through other means, like capping certain business tax credits.
3. Will Newsom endorse any bonds?
One way Newsom and lawmakers could stem painful cuts to allied interests is through bonds for priority projects like climate and housing.
The governor previously told Speaker Robert Rivas the state has no more than $16 billion in bonding capacity this year. Lawmakers are jockeying to put bonds for climate, school infrastructure and housing on the November ballot. But it’s unclear what appetite voters will have for bonds this fall after the governor’s $6.4 billion push for behavioral health treatment beds, Prop 1, barely passed in March.
4. What will new legislative leaders do with his budget?
Soon after dropping his revised spending proposal, Newsom will enter negotiations with Rivas and Senate pro Tem Mike McGuire. Neither of these lawmakers have directly negotiated the budget with Newsom, and the looming deficit adds a layer of urgency.
These “Big Three” negotiations are generally secretive, but former leaders, Sen. Toni Atkins and Assemblyman Anthony Rendon, largely avoided drama with Newsom.
While Democrats in the Capitol agree on a lot, it will be interesting to see whether lawmakers will continue to push back on proposals — particularly when it comes to cuts — in Newsom’s budget plan.
SENATE REPUBLICANS URGE CPUC TO REJECT FIXED CHARGE
In a letter to the California Public Utilities Commission, Senate Minority Leader Brian Jones, R-Santee, and his entire Senate Republican Caucus urged the commission to reject a proposed $24.15 fixed charge for consumers’ electrical bills as part of a proposal intended to bring down electricity prices for customers across the state.
According to the proposal, most customers would be charged a flat $24.15 rate, though certain low-income customers would be billed $6 and those living in certain affordable housing developments would pay $12.
In exchange, the electricity usage rate would be cut by 5 to 7 cents per kilowatt-hour.
“Under the proposal, all customers, regardless of income or location, will see financial benefits if they electrify. For example, a customer who powers their home and vehicle with electricity would save an average of $28-$44 per month compared to under today’s billing structure,” according to the CPUC.
In their letter, Senate Republicans warn that this fixed fee is opening a door that should stay closed.
“We are particularly concerned that this will only be the beginning. The CPUC has been granted unchecked power to increase this new charge at any time. If the $24.15 plan is approved, the next proposal may see the fixed charge hiked to $50, $100, or even higher!” the letter reads in part.
The Republicans pointed out that California is behind only Hawaii and Rhode Island when it comes to electricity prices. They added that the concept of a fixed charge is “inherently flawed” because it contradicts principles of fair pricing and consumer protection.
“Customers should primarily pay for the electricity they use, plain and simple,” the letter reads.
The CPUC meets at 11 a.m. Thursday to discuss the measure.
BONTA URGES CONGRESS NOT TO WATER DOWN CALIFORNIA PRIVACY LAW
California led the way in passing a strong privacy law in 2018, and now that Congress is attempting to catch up with the American Privacy Rights Act, Attorney General Rob Bonta is asking them not to weaken the state law while passing a federal one.
“We encourage Congress to adopt legislation that sets a federal floor, not a ceiling, for critical privacy rights and respects the important work already undertaken by states to provide strong privacy protections for our residents,” Bonta wrote, in a letter co-signed by 14 attorneys general.
The letter urged Congress to pass a federal framework that “respects — and does not preempt — more rigorous and protective state laws.”
The APRA would create a national standard for consumer data privacy rights, and require companies to be transparent in how they use consumer data, as well as to give consumers the right to access, correct, delete or export their data and opt out of targeted advertising and data transfers.
However, the bill also contains a preemption clause, meaning it would supersede any state law.
“Any federal privacy framework must leave room for states to legislate responsively to changes in technology and data collection practices. This is because states are better equipped to quickly adjust to the challenges presented by technological innovation that may elude federal oversight,” the letter reads.
QUOTE OF THE DAY
“I have cognitive problems, clearly. I have short-term memory loss, and I have longer-term memory loss that affects me.”
– Independent presidential candidate Robert F. Kennedy Jr., in a 2012 deposition where he said that a worm had partially eaten his brain and that he was suffering from mercury poisoning. Via the New York Times.
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