Well, it doesn’t look as though California’s big bet on a federal stimulus package that would allow the state to reverse $11 billion in budget cuts is likely to pay off.

In a Tuesday tweet that sent shock waves through Wall Street, President Donald Trump announced he was ending negotiations on a coronavirus relief package until after the November election, accusing Speaker Nancy Pelosi of trying to “bailout (sic) poorly run, high crime, Democrat States.” The move has massive implications for California, which planned to rescind cuts to state employee salaries, courts and the UC and CSU systems if the feds supplied aid by Oct. 15. (Late Tuesday night, Trump expressed support for more stimulus checks and small-business aid.)

It also raises the question of whether Gov. Gavin Newsom will change his mind about levying new taxes on millionaires and big businesses as other revenue sources dry up and the state racks up billions of dollars in delayed payments owed to K-12 schools and community colleges. The governor’s press office did not respond to a request for comment Tuesday. 

  • Newsom in September: “Now is not the time for the kind of state tax increases on income we saw proposed at the end of the legislative session, and I will not sign such proposals into law.” 
  • Tia Orr of SEIU California, one of the state’s largest unions, on Tuesday: “Without the courage to tax the ultra-wealthy, California’s leaders are choosing to make schoolchildren, college students, working people and people seeking justice in our courts pay the price — the vast majority of whom are people of color.”

It would take California’s economy more than two years to reach pre-pandemic levels assuming the federal government passes a stimulus package of at least $1 trillion, a recent UCLA report found. Otherwise, the forecast “is too optimistic,” the economists wrote. 

Still, not all hope is lost. Although the state budget specified an Oct. 15 deadline to reverse cuts, it also allows for updates — with the approval of the Legislature — if federal aid is sent later, H.D. Palmer, a spokesperson for the Department of Finance, told me.


The coronavirus bottom line: As of 9 p.m. Monday night, California had 828,461 confirmed coronavirus cases and 16,177 deaths from the virus, according to a CalMatters tracker.

Also: CalMatters regularly updates this pandemic timeline tracking the state’s daily actions. And we’re tracking the state’s coronavirus hospitalizations by county.

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If state lawmakers have any regrets about one of this year’s most controversial ballot measures, they’ll need to mount a “super, super, super-duper majority” to change it. As Ben Christopher explains, that’s more common than you might think.


Other stories you should know

1. More problems at unemployment department

Image via iStock

California’s besieged unemployment department just resumed accepting new claims after a two-week pause, but is already facing another problem: Unemployed Californians say they’re unable to access their benefits due to frozen debit cards and locked bank accounts, some of which are suddenly drained of money, CalMatters’ Stephen Council reports. It appears that legitimate claimants have gotten tangled up in the Employment Development Department’s efforts to crack down on fraud — an overlap Newsom’s strike team said the agency should avoid. The department is expected to provide an update on the problem at an Assembly hearing today.

  • Joseph Wood, a gig driver whose unemployment bank account was drained this week, preventing him from buying gas: “I’m incredibly frustrated. I was supposed to go up and pick up my kids on Monday, but I couldn’t.”

2. Millions of Californians don’t get emergency alerts

Taylor Craig at the edge of his family’s property outside of Vacaville on Oct. 2, 2020. Craig protected his home from the LNU Lightning Complex after not receiving an evacuation warning. Photo by Anne Wernikoff for CalMatters

Despite record-defying fires that have already burned more than 4 million acres, less than 25% of adults in 13 of California’s most fire-prone counties have signed up for county emergency alerts — leaving millions of vulnerable residents without access to evacuation warnings that could mean the difference between life and death. But even those who signed up for alerts don’t always get them, exposing yet another gap in California’s emergency notification systems, CalMatters’ James Bikale reports. Residents and lawmakers are pushing for automatic enrollment at both the local and state level, but a complex tangle of logistical and legal challenges is proving difficult to unravel.

  • Sarah Johnson, a Yolo County resident: “It’s very concerning that emergency alerts would be opt-in only.”
  • Ken Dueker, director of Palo Alto’s Office of Emergency Services: “You’ve got to sign up, and, frankly, very few people do. I don’t blame them because they don’t know about the tool — they falsely assume the government has these magic, omniscient powers to notify.”

3. California lawmakers slam Exide settlement

The closed Exide factory, a former battery recycling facility in Vernon that has contaminated the surrounding area with lead in its soil, on April 5, 2017. Photo by Danny Moloshok, REUTERS via Alamy
The closed Exide factory, a former battery recycling facility in Vernon, on April 5, 2017. Photo by Danny Moloshok, REUTERS via Alamy

California taxpayers would likely have to shoulder millions of dollars in cleanup costs for homes and land contaminated by Los Angeles’ Exide battery-recycling plant — which for decades released toxic lead and arsenic into surrounding working-class Latino neighborhoods before shuttering in 2015 — if the company’s bankruptcy settlement, backed by the U.S. Department of Justice, is approved in federal court next week. In a scathing Tuesday letter, Assembly Speaker Anthony Rendon and other California lawmakers slammed the DOJ for supporting a settlement that they say allows Exide to abandon the site of the largest toxic contamination in California history without cleaning it up or reimbursing taxpayers for the more than $250 million they’ve already spent on remediation. The lawmakers also asked the DOJ to give the public more time to weigh in on the settlement.

  • Rendon and lawmakers: “Unfortunately for our residents, unlike Exide, there is no legal process that allows them simply to erase the lead pollution from their bodies.”

Newsom recently vetoed a bill that would have strengthened oversight of California’s Department of Toxic Substances Control, which is overseeing the Exide cleanup. In his veto message, Newsom wrote the bill “seeks to impose changes to governance but lacks necessary fiscal reform.”


Upcoming events

CalMatters is hosting “Props to You” events — virtual Q&As for you to ask all of your burning questions about the 12 propositions on California’s November ballot. Register hereEach event runs from 6-7pm.

CalMatters commentary

Prop. 15 threatens small businesses: Proponents claim that only the largest corporations will be taxed. That PR spin is quickly dispelled when anyone with basic business knowledge reads the proposition, argues Edwin Lombard of the California Black Chamber of Commerce.

Prop. 15 furthers racial equality: California’s cap on commercial property taxes unfairly keeps resources away from the schools and communities that need them most, argue Angela Glover Blackwell of PolicyLink and Anthony Thigpenn of California Calls.

More opposition to Orange County desalination project: It would damage sea life in our coastal waters and use a tremendous amount of power, write Trygve Sletteland and Sonia Madeira de Ley, Laguna Beach residents.

Other things worth your time

Two counties move backward in state’s coronavirus reopening plan. // Los Angeles Times

In fire-prone Napa, many winery employees double as region’s volunteer firefighters. // San Francisco Chronicle

California wildfires are huge this year, but not the deadliest. // Associated Press

More than 2,000 Los Angeles County voters received ballots without a way to vote for president. // Los Angeles Times

New California law mandating racial diversity on corporate boards is already facing a lawsuit. // Associated Press

Riverside megachurch pastor who attended White House event contracts COVID-19. // Politico

Watchdog: A secretive ‘gang-like’ group of deputies at East LA sheriff’s station exert ‘undue influence.’ // Los Angeles Times

Fremont moves ahead with controversial tactic of installing boulders to keep homeless away from multibillion-dollar businesses. // East Bay Times

See you tomorrow.

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Emily Hoeven wrote the daily WhatMatters newsletter for three years at CalMatters . Her reporting, essays, and opinion columns have been published in San Francisco Weekly, the Deseret News, the San Francisco...