In summary

State legislators go back to work this week with a focus on homelessness, wildfire, how to spend yet another fat budget surplus, and a Capitol baby boom.

Good morning, California. Laurel Rosenhall here, sitting in for Dan Morain, who will return from vacation later this week.

“Being speaker is a demanding job. And I’m sure being a parent is a demanding job as well. So something will have to give.” — Assembly Speaker (and new father) Anthony Rendon discussing his outlook for 2020.

Back to work

California Capitol dome, Sacramento

The Legislature returns to Sacramento today, opening the second half of a two-year session that will revive some ideas that stalled in 2019 and raise new proposals to drive the action in 2020.

Look for a focus on: 

  • Homelessness: Californians see homelessness increasing in their communities, polls show, and voters now say the issue is the state’s top concern. Lawmakers and Gov. Gavin Newsom deployed $1 billion to fight the problem in last year’s budget, with funding to house mentally ill homeless people and build more emergency shelters. This year, lawmakers may push to better track how cities are spending the money. Also possible: a renewed push to force the most troubled homeless mental patients into treatment, or a legal “right to shelter” that would compel cities to build enough shelters to accommodate anyone who wants a bed. Learn more about California homelessness and potential solutions in this terrific explainer by CalMatters’ Matt Levin and Jackie Botts.
  • Gig economy: The lawmaker behind California’s watershed worker-classification bill is expected to work on more carve-outs, even as various industries challenge the law in court. Assemblywoman Lorena Gonzalez, D-San Diego, who has been hit with a barrage of social media complaints over how AB 5 impacts workers, has committed to working with the music industry and says she’s open to other clarifications. However, she and Assembly Speaker Anthony Rendon are clear that they are done negotiating with gig companies Uber and Lyft, which are funding a ballot measure to fight the new law. “I have no interest in getting involved in that,” Rendon told CalMatters’ Laurel Rosenhall. “I think we’ve been quite good to those people.”

$7 billion question

Gov. Gavin Newsom with last year’s revised budget proposal, May 9.

State budget negotiations also will open this week, as Gov. Gavin Newsom reveals his opening proposal for the year that starts in July. His announcement is expected Friday, according to CalMatters’ Judy Lin, who reported last month that California is still flush.

The biggest question: How does Newsom want to spend California’s $7 billion surplus? It’s a much smaller cushion than last year’s $21 billion, and demands exceed dollars.

  • Legislative Democrats are calling for an expansion of Medi-Cal health coverage for undocumented immigrants 65 and older, as well as authorization for low-wage undocumented immigrants to claim tax credits from the state.
  • Lawmakers would also like to increase special education funding in public schools and increase enrollment at the most-desired University of California campuses.

Meanwhile, a feud with the Trump administration could cost California $1.5 billion. The state needs federal permission to maintain a tax on health insurers for managing its Medi-Cal program for the poor.

Known as a “managed care organizations tax,” its revenue, collected from participating health insurers, gets matched by the federal government. That accounting maneuver allows the state to draw down more funding.

  • Assemblyman Phil Ting, chair of the Assembly Budget Committee, told reporters last month that the state is prepared to proceed without Trump’s approval.
  • Newsom’s budget last year did not include the tax.

Legislative Analyst Gabriel Petek is urging lawmakers to limit ongoing new spending to less than $1 billion.

Newsom: Year Two

Gov. Gavin Newsom discussing PG&E and wildfires, Oct. 30.

Newsom starts his second year in office with high marks for ambition — and lower marks for delivery.

Los Angeles Times: “[The governor] can point to a string of high-profile victories in service of a progressive agenda and fortifying California’s political resistance to President Trump. …[But] less known outside of Sacramento is that Newsom has struggled with what some critics believe is an undisciplined and impatient governing style.”

San Francisco Chronicle: “Newsom called for fixing California’s growing housing shortage with an “audacious goal”: building 3.5 million new homes by 2025. … Instead, local governments were on track to issue nearly 8% fewer housing permits during Newsom’s first year than in 2018.”

Legislative lobbyists and staff complained to The Times’ Taryn Luna that the administration “still has a chaotic, ‘the left hand doesn’t know what the right hand is doing’ kind of feel to it,” that Newsom trips himself up with attempts to get national press attention, and that the governor “ended up the year looking like a rank amateur” (at least to environmental advocates) with his veto of a farm-opposed bill — carried by Senate President Pro Tem Toni Atkins — that would have blocked federal environmental rollbacks.

But Assembly Speaker Anthony Rendon told CalMatters he expects this year’s legislative relations with Newsom to go more smoothly:

Rendon: “There were some bumps in the road with Gavin early on. At the time, it was hard to contextualize. It was just irritating. But when you think about it, yeah, it makes sense. It’s a whole new team, whole new relationships.”

CalMatters did its own assessment of the governor’s learning curve back in October. We’re also tracking Newsom’s progress on campaign promises here.

Baby boom

Assemblyman Anthony Rendon of Lakewood, left, gets a smile from his wife, Annie Lam, after the votes were cast electing him as the next Assembly speaker, Monday, Jan. 11, 2016, in Sacramento, Calif. Rendon will formally take over leadership of the chamber starting in March. (AP Photo/Rich Pedroncelli)
Assembly Speaker Anthony Rendon with his wife, Annie Lam, in 2016

An especially fruitful fall recess blessed some key Capitol players:

  • Assembly Speaker Anthony Rendon and his wife, Annie Lam, had their first child, a daughter named Vienna
  • Assemblywoman Sabrina Cervantes became just the fourth California legislator to give birth while holding office — she and her wife, Courtney Downs, welcomed triplets (two boys and a girl).
  • Jason Elliott and Nicole Elliott, two of Gov. Gavin Newsom’s top aides, became parents when baby Lucy arrived on Dec. 13.

Congratulations to the new parents and a warm What Matters welcome to the tiny turnout.

Commentary at CalMatters

Liz Bergeron, Pacific Crest Trail Association: Shortchanging our public lands is shameful and shortsighted given their value. The Pacific Crest Trail Association not only supports tackling the maintenance backlog, we support full and permanent funding of the Land and Water Conservation Fund.

Dan Walters, CalMatters: Whether it’s realignment, school funding or mental health policy, California politicians too often make sweeping policy decrees, then fail to check how the money to implement the policies is spent.


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See you tomorrow.

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Laurel covers California politics for CalMatters, with a focus on power and personalities in the state Capitol. She's been included in the Washington Post’s list of outstanding state politics reporters...