Good morning, California. Ben Christopher is sitting in for Dan Morain, who is on assignment this week.

“What do we do about it? How do we assure the public the system isn’t totally rigged?”—Assemblyman Kevin McCarty, chair of the budget subcommittee on education finance, grilling University of California officials on the massive, and California-centric, college cheating conspiracy. 

Admissions scandal lands at the Capitol

California lawmakers ask how to deter UC admissions cheats.

The college cheating scandal officially entered the realm of state policy on Tuesday, as an Assembly budget subcommittee considered how best to prevent the wealthy and well-connected from gaming admission to elite California colleges, including the top UC campuses.

The 2-hour brainstorming session with University of California officials, led by Assemblyman Kevin McCarty, a Sacramento Democrat and Cal State alumnus, underscored both the weaknesses in admissions oversight and the challenges in leveling the playing field for California students, reports CALmatters’ Felicia Mello.

  • Among the takeaways: Athletic recruiting and the SATs are about to get a hard look, public colleges seem, so far, to be less prone to abuse than private universities such as USC and Stanford, and the UC system turns out to have its own “side door” to admissions.

Only three UC admissions so far—two at UCLA and one at UC Berkeley—have been clouded in the sweeping investigation that left 50 adults indicted for trying to cheat kids into top colleges from the Ivy League to Stanford. But lawmakers urged the sternest possible actions against anyone found to have cheated their way into the 10-campus UC system.

Second opinion: Washington Post economics columnist Robert J. Samuelson suggests a “morally acceptable and practical” fix to a system that “encourages deceit, unfairness and illegality” in admissions: auction off some of those spots.

Who will lead PG&E?

Environmentalists have a dim view of PG&E's reported next CEO.

When PG&E filed bankruptcy in January, wildfire victims worried they could be shortchanged and environmentalists feared the state’s largest utility would ditch the renewable energy needed to meet the state’s climate goals.

  • Now enviros are afraid that hedge funds could install corporate leadership that won’t prioritize California’s ambitious 100 percent clean energy goal for 2045.

Vote Solar, Earthjustice & Environment California: “This is a Herculean task and in order to achieve it, we believe that it is critical that new leadership at PG&E have a history of enthusiastically embracing this vision.”

The Wall Street Journal reports PG&E is close to naming Bill Johnson, CEO of Tennessee Valley Authority, as chief executive. The utility is also said to be working with three hedge funds—Abrams Capital Management, Knighthead Capital Management and Redwood Capital Management, which own a combined 9 percent of PG&E stock—to make the appointment.

  • Ed Smeloff of Vote Solar tells CALmatters’ Judy Lin that Johnson did not prioritize developing solar while at TVA and blamed a contractor rather than take responsibility for a massive coal ash spill.

Smeloff:  “We may end up with a PG&E management board that’s really focused just on maximizing short-term profits and recapitalizing the company coming out of the bankruptcy.”

PG&E would not comment on the rumors but says it “appreciates the constructive dialogue that it has had with shareholders and other stakeholders regarding the appropriate composition of the board.”

  • The utility must decide soon: Board nominations have been extended to March 25. Read more of Lin’s PG&E coverage here.


Moved to bipartisanship

Assemblyman Jim Patterson

A widow’s powerful argument unexpectedly moved the needle on a tough-on-crime bill Tuesday, bringing members of an Assembly committee to tears and changing lawmakers’ minds.

  • The bill under consideration would boost the penalty for fleeing the scene of a car accident. Fresno Republican Assemblyman Jim Patterson wrote it after Gavin Gladding, a Clovis public school vice principal, was killed in a hit-and-run collision.
  • The bill faced long odds. California’s political pendulum is swinging toward restorative justice, and many Democrats oppose making the state criminal code more punitive.

Patterson: “I was fully prepared to have to commiserate and to console the family members today. I tossed and turned all last night.”

Then Susan Gladding, Gavin’s widow, testified.

Gladding, afterward: “I really wanted everyone to realize that this was my husband. This was a real person. And this was my person, but this could have been your person also.”

The bill didn’t pass the committee, but her words left lawmakers and lobbyists visibly moved, and the Democratic chair, Los Angeles Assemblyman Reginald Jones-Sawyer, agreed to give both sides more time to negotiate.

Jones-Sawyer: “Mrs. Susan Gladding, you are the first witness that’s ever…turned this committee with your passionate, emotional testimony…you’ve been the most powerful advocate for your cause that we’ve ever had.”


FSB Core Strategies: Public Affairs. Ballot Campaigns. Legislative & Regulatory Fights

Payday regs in the works

Lawmakers are again taking aim at predatory loans.

Consumer advocates hope this is the year California Democrats will crack down on payday lenders. A bill by Santa Barbara Democratic Assemblywoman Monique Limón would apply an interest rate cap on loans between $2,500 and $10,000. Interest rates on smaller loans are already capped at 36 percent. 

By the numbers: In 2017, 58.8 percent of all consumer loans between $2,500-$4,999 came with rates of over 100 percent.

A more lender-friendly bill by Sen. Ben Hueso from San Diego would introduce more modest regulations, requiring consumer lenders to “determine if a borrower has a reasonable ability to repay.” Consumers’ rights groups are not impressed.

Graciela Aponte-Diaz, California director of policy for the Center for Responsible Lending: “It’s just window dressing…it’s just to let the industry say that they’re doing something.”

Californians for Credit Access, a coalition representing small loan lenders, opposes Limón’s bill and argues that it would remove financial options for low-income consumers. The group has not yet taken a position on Hueso’s bill.

  • Hueso’s proposal mirrors Obama-era regulations now being reconsidered by the Consumer Financial Protection Bureau. Yesterday 25 state attorneys general, including California’s Xavier Becerra, wrote the Bureau a letter, arguing that nixing the rules would leave citizens “unprotected from many types of exploitative loans.”

The Trump trolling tax bill returns

Presidential contenders would have to release their taxes in CA.

Last year, Gov. Jerry Brown vetoed a bill that would have required presidential candidates to release their tax returns to get their names on the state’s primary election ballot. 

Brown doubted the constitutionality of the measure and worried it might lead to a “slippery slope.”

Brown’s veto: “Today we require tax returns, but what would be next? Five years of health records? A certified birth certificate? High school report cards?”

Now Brown is gone and the bill is back. It received its first hearing yesterday morning.

  • Authored by Democratic Sen. Mike McGuire from Healdsburg, Senate Bill 27 is clearly a dig at President Trump, who famously broke with the post-Watergate tradition of presidential candidates revealing their financial dealings.
  • “Voters deserve to know,” McGuire told a Senate committee, whether a president—any president—has “business dealings with corporate interests or dealings with foreign governments and foreign banks.”

CALmatters covered this proposal—and the various legal questions it raises—when it came up the first time. Read more here.

Take a Number: 251K and counting

Not Devin Nunes' cow.

Central Valley Congressman Devin Nunes’ lawsuit against Twitter, claiming that the San Francisco company allowed “abusive, hateful and defamatory” tweets attacking the Republican politician, has yielded an unintended side effect: It’s drawing tens of thousands of Twitter followers to one of the parody accounts Nunes targeted.

  • @DevinCow —a.k.a. “Devin Nunes’ cow”—had about 1,000 followers when Nunes filed his complaint Monday in Virginia state court, seeking more than $250 million in damages.
  • By Tuesday evening, the total had topped 250,500, still well short of the congressman’s 392,000 followers, but gaining.

Nunes isn’t the first public figure who has tried to quash something unflattering on the Internet, only to trigger its virality. In fact, there’s a term for the phenomenon: The Streisand Effect.

Commentary at CALmatters

If one death is too many, what is 263?

Laura FriedmanAssemblywoman representing Glendale: Between 2010 and 2017, stolen firearms were used in at least 60 homicides in California, and 203 youths ended their lives because of unauthorized access to a firearm. AB 276 will hold gun owners accountable by requiring all firearms to be securely stored with Department of Justice-approved firearm safety devices.

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