Jerry Brown with Ronald Reagan.
Jerry Brown with Ronald Reagan.

In summary

Rent cap deal is far from done. Before Newsom, Reagan battled feds over automobile emissions rules. PG&E searches for a Plan B.

Good morning, California.

“His final GPS pt indicates he was btwn Bel Air Crest Rd & Sepulveda Blvd underpass. The 4yo had crossed the 10-lane fwy in July. We don’t know why he tried to cross but it might be bc of another lion in the area.”—Santa Monica Mountains National Recreation Area tweeted, announcing the demise of the mountain lion known as P-61.

  • The L.A. Times: Plans are underway to build an $87 million wildlife crossing bridge on the 101 Freeway in Agoura Hills. It’s expected to break ground within two years.

What’s ahead this week

Assemblymember Robert Rivas in session on Aug. 12

Endangered species, gig workers, children, universities, privacy, parolees who want to vote, people who want straighter teeth, and alligators. 

More than 600-plus bills await final votes before Friday. Most have narrow potential impact. But a few will be noticed by everyone if they become law. And there will be fundraisers, of course.

For my take on the final week, please click here.

Politics of rent cap bill

Image via Flickr
Expect a fight over rent cap legislation.

Gov. Gavin Newsom and Democratic lawmakers struck a deal last week to limit the amount that landlords can raise rent at 5% plus inflation. It also will restricting evictions.

The deal is far from done, as CalMatters’ Matt Levin and the L.A. Times’ Liam Dillon explain in the latest episode of Gimme Shelter, the California Housing Crisis Podcast.

The California Apartment Association, representing the landlords lobby, announced it would be neutral on the legislation by Assemblyman David Chiu, Democrat from San Francisco

But the California Association of Realtors, which previously pledged to stay neutral on the legislation, is opposing it.

Speaker Anthony Rendon and Senate President Pro Tem Toni Atkins signed off on the deal. That suggests the votes are there. But Realtors are formidable. Look for the measure to be the focus of one of the biggest fights of the final week of the 2019 legislative session.

To hear Levin and Dillon’s breakdown, please click here.

Money matters: Realtors spent $745,000 on lobbying in the first half of the year, ranking No. 22 among all lobbyist employers, just below the apartment association’s $762,000. More to the point, Realtors:

  • Held a combined $29.7 million in three separate campaign accounts as of June 30.
  • Gave $1.38 million in campaign contributions to sitting members of the Legislature since 2017.
  • Donated $2.5 million to California Democratic Party committees since 2017.
  • Donated $1.38 million to California Republican Party committees since 2017.

What would Reagan do?

Jerry Brown with Ronald Reagan.
Ronald Reagan

Tensions escalated between the Trump administration and California over the state’s authority to combat climate change and reduce smog, with the feds threatening the state with unspecified “legal consequences.”

CalMatters’ Rachel Becker reports that Trump’s Environmental Protection Agency warned California that its pact with four automakers to cut greenhouse gases in vehicle exhaust “may result in legal consequences.”

  • Gov. Gavin Newsom: “California stands up to bullies and will keep fighting for stronger clean car protections that protect the health and safety of our children and families.”

Perhaps Newsom was channeling Gov. Ronald Reagan. In 1968, Gov. Reagan battled efforts by Detroit automakers and Michigan’s congressional delegation to block California from imposing its own rules.

Trump is seeking to roll back Obama-era goals to cut greenhouse gas emissions—forged with California’s input—and is threatening to revoke California’s authority to regulate air quality.

Honda, Ford, Volkswagen and BMW split from Trump, agreeing with the Newsom administration that they would adhere to the California standards. 

  • Trump took to his Twitter account: “Henry Ford would be very disappointed if he saw his modern-day descendants wanting to build a much more expensive car, that is far less safe and doesn’t work as well, because execs don’t want to fight California regulators.”

For Becker’s explainer on the issue, please click here.

P.S. Trump’s Justice Department has opened an investigation into whether the car companies broke antitrust law by forging their own agreement with California, The Wall Street Journal reported.

What’s next for PG&E

PG&E faces decisions.

PG&E’s failed effort to win legislative approval of a $20 billion bond to help it get out of bankruptcy leaves it searching for a way forward amid tens of billions of dollars in wildfire costs.

CalMatters’ Judy Lin reports that its narrowing options could drive it into the arms of Wall Street investors, including a group that includes major Republican donor Paul Singer, the billionaire known for his combative style, coal investments, and portfolio of distressed properties

PG&E dismisses the notion publicly. But UC Hastings Law School Professor Jared Ellias says:

  • “PG&E was looking for financing through the state, but they weren’t able to get it and now they have to put together their own financing package. Maybe that will involve the bondholders.” 

Another way: Sell assets.

San Francisco told PG&E on Friday it would pay $2.5 billion to buy power lines and other related infrastructure serving the city, The San Francisco Chronicle reported.

  • PG&E’s spokesman didn’t say “no,” telling The Chronicle: “While we don’t believe municipalization is in the best interests of our customers and stakeholders, we are committed to working with the city and will remain open to communication on this issue.”

Senate President Pro Tem Toni Atkins agreed Friday to allow legislation to be put into print authorizing the $20 billion bond sale, so long as it doesn’t go to vote until January. The bill probably would require a two-thirds vote, an uphill battle.

For-profit colleges prevail

Piggy bank with graduation cap beside a student loan coin jar
Bills focused on for-profit colleges and student loans falter.

Bills to tighten oversight of for-profit colleges have faltered amid a lobbying campaign to defeat the measures, CalMatters higher education reporter Felicia Mello reports.

Consumer and veterans groups hoped California would take the lead in regulating for-profit colleges, as the Trump administration rolls back regulations. 

For-profit colleges saw the effort as an existential threat and spent heavily to influence legislators, Mello reports. 

Helping the schools’ case: The state agency that would have enforced many of the new rules has a record of sitting on student complaints and failing to perform required inspections.

Three of the seven bills survive, including one that would create a state database of career education programs with their graduates’ earnings and debt levels.

P.S.: Legislation that attracted national attention to regulate student lenders stalled in the Senate Appropriations Committee. Democratic presidential candidate Tom Steyer had testified in favor of  the measure by Assemblyman Mark Stone, Santa Cruz-area Democrat.

Clash over G.I. benefits

Another California vs. Trump battle focuses on military education benefits.

The U.S. Department of Veterans Affairs said Friday it was taking over responsibility for deciding which California schools qualify to receive military education benefits, a role it has traditionally delegated to states, CalMatters’ Felicia Mello reports

Uncle Sam is insisting that the California State Approving Agency for Veterans Education approve payments of GI Bill benefits to Ashford University, a for-profit college. 

California Attorney General Xavier Becerra is suing Ashford, alleging the school lied to prospective students about financial aid and job outcomes. California won’t authorize payment so long as the suit is pending.

What’s ahead: Another Trump vs. California fight is in store.

Alligators and the Legislature

california legislature, last week of session, alligator imports
Yes, there is an alligator bill.

Few bills ever truly die in the Capitol, unlike alligators.

Current law: Importation into California of alligator and crocodile products such as shoes and jerky will become illegal starting Jan.1. The law intended to protect certain species dates to Ronald Reagan’s time as governor, as told in this piece

This year, legislation pushed by the states of Louisiana and Mississippi, and alligator farmers, would allow for the extension of alligator part sales until 2024. That died in the Senate Appropriations Committee last month. 

Or did it?

The author, Assemblywoman Blanca Rubio, a San Gabriel Valley Democrat, gutted another bill related to housing, and inserted ‘gator and croc language

The compromise would give the farmers and Louisiana and Mississippi another year to continue sales into California, until 2021. Which means a new lobbying fight over the issue next year.

Commentary at CalMatters

Joseph Sanberg, Working Hero Action: Poverty is a threat to our economy, security and human potential, and it’s an issue politicians on stages large and small have avoided. That needs to end. Poverty must take center stage at the Houston debate Sept. 12 because it is a challenge our next President must not ignore. 

Dan Walters, CalMatters: California Insurance Commissioner Ricardo Lara issued a mea culpa for a broken campaign promise. End of story? Not quite. One of Lara’s earliest and sharpest critics about his fundraising, a Southern California organization called Consumer Watchdog, was not exactly disinterested.

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Dan Morain joined CalMatters in March 2018. He is the former editorial page editor of The Sacramento Bee. Morain also spent 27 years at The Los Angeles Times, and has covered the Capitol since 1992.