California lawmakers OK Newsom plan that could someday cap oil industry profits

From CalMatters’ politics reporter Alexei Koseff:

The California Assembly handed Gov. Gavin Newsom a long-awaited win on Monday, approving his revised proposal to punish alleged price gouging by oil companies and sending the measure to his desk for a signature, nearly six months after he first called on state lawmakers to take action on record gas prices.

The floor vote was an overwhelming 52 to 19 — far more than the simple majority needed to pass in the 80-member house. But unlike in the state Senate last week, where Democrats supported the bill in near-lockstep, about one-eighth of the Assembly Democratic caucus laid off in the initial vote. Assemblymember Jasmeet Bains, who represents part of oil-producing Bakersfield, was the lone Democrat who voted no, tweeting later that she “will never throw my constituents under the bus.”

The bill, Senate Bill X1-2, which would authorize the California Energy Commission to investigate and potentially cap oil industry profits, always faced a tougher road in the Assembly, where business-friendly moderate Democrats hold greater sway.

Monday’s vote, however, reflects enduring apprehensions among many lawmakers about what the ultimate effect could be on gas prices in California.

Though the measure does not directly penalize the industry — it would take new regulations and an inquiry by the energy commission before any fines would be imposed, something that is years away, if it ever happens at all — opponents, including some independent economists, object that a profit cap creates a disincentive for refineries to operate at maximum capacity. They argue that the industry will reduce production to remain below whatever level is set, creating an artificial constraint on supply that could instead drive up prices further.

Republicans, who uniformly voted against the bill in the Assembly, amplified those anxieties during the floor debate, dismissing Democratic complaints about high gas prices as the result of overregulation by the state and their attempt to fix the problem as effectively another tax on drivers.

Those concerns already forced Newsom to pivot away from his initial plan to define a profit threshold and penalties in the bill. The revised version, unveiled less than two weeks ago, had more input from legislators through months of discussions between the administration and working groups of Democratic representatives, including Assemblymember Jacqui Irwin.

The Thousand Oaks Democrat was a skeptic of Newsom’s original bill, telling CalMatters on the first day of the special session in December that she was unsure the governor could come up with a plan that she could get behind. But on Monday, Irwin was the Assemblymember who brought SBX1-2 up on the floor, touting how it incorporated feedback from lawmakers.

Irwin told CalMatters last week that the primary concern she had expressed to the governor was that the Legislature lacked the data and the expertise to set an appropriate fine itself. That’s addressed by new requirements for oil companies to report additional information to the state about their operations and also by moving the penalty to a regulatory process, which Irwin said offered a “longer-term solution.”

• Irwin: “As the Legislature, I don’t believe that we really had the expertise to determine what the unintended consequences could be…. This is a much more holistic approach.”

Newsom plans to sign the bill late this afternoon. Leaving the state Capitol on Monday, he told reporters assembled in the hallway that the vote had sent “a big and very powerful message” to the oil industry and others who may be watching California.

• Newsom: “I hope this is a signal to other states and leaders across this country and around the globe that we can see the future, and I’m looking forward to this being a hinge moment.”

California’s water crisis, explained: Despite the series of atmospheric rivers and devastating floods, the state isn’t flush with water. CalMatters has a detailed look at how California might increase its water supply, and a dashboard tracking the state’s water situation.  

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1 Pushing for tougher crime laws

You have to give legislative Republicans credit for persistence. 

They continue to push some proposals on crime, even though the Democratic-majority Legislature shoots them down, quickly. 

Monday, state Senate GOP leader Brian Jones of San Diego County offered an amendment to repeal a 2022 law that supporters say prevents selective enforcement of prostitution laws against transgender people, but that critics say makes it difficult for law enforcement to crack down on sex trafficking. After about five minutes of statements, the Senate rejected Jones’ amendment on a 29-8 vote, with three absences.

• Jones: “Laying these amendments on the table means letting a bad law stay on the books that isn’t working as intended and is in fact allowing more women and young girls being sex trafficked. It means less arrests of pimps that are sex trafficking and law enforcement having fewer tools to help victims left out in the street.”

• Democratic Sen. Mike McGuire from Santa Rosa, in a rebuttal: “The number one commitment of this body is to keep this state safe. It’s not about sound bites, it’s about smart policy.”

And today, the Senate public safety committee is to take up a bill from Sen. Roger Niello, a Sacramento Republican, that would make serial theft a felony. This is another effort to roll back Proposition 47, which was approved in 2014 and made shoplifting a misdemeanor as long as the items stolen totaled $950 or less. Critics blame that change for a rash of brazen smash-and-grab thefts of drug stores.

• Niello, in a statement: “Even though Proposition 47 was labeled as ‘Safe Neighborhoods and Schools Act,’ property crime has increased since its passage, and our communities and businesses are the ones facing the consequences. It is crucial that we hold criminals accountable and make our communities safer.”

Earlier this month, the Assembly public safety committee quashed a Republican bill to increase criminal penalties for domestic violence.

But even if the bills don’t pass, they do get attention — which may be the point.

In a Public Policy Institute of California survey in February, 65% of Californians said they are very or somewhat worried that they or a family member will be a victim of crime. With 2024 election campaigns well underway, highlighting instances where Democrats dismiss tougher crime measures gives Republicans more ammunition to garner support from voters who are anxious about crime.

Even Democratic crime bills sometimes get bogged down. Assemblymember Reggie Jones-Sawyer from Los Angeles plans to speak at today’s meeting of the Assembly public safety committee, which he leads, about why he put a hold on all fentanyl-related bills. (The Senate public safety committee, however, is hearing fentanyl bills today.)

• Jones-Sawyer, in a statement: “The fentanyl issue requires comprehensive input from a variety of experts and stakeholders in order to establish a united approach to solving the matter. Often there are duplicative efforts put forth, or broad scoped legislation offering temporary solutions or providing no rational solutions at all. Moving forward, I intend to work on this issue by bringing those who understand the causation, prevention and treatment components together with policy makers to ensure we have a tactical solution in hand.”

This includes bills from fellow Democrats, such as one proposed by San Diego Assemblymember Brian Maienschein. His measure would enact harsher penalties to fentanyl dealers if they cause “great bodily injury” or death to a victim. Maienschein expressed disappointment that the committee is not acting with “appropriate urgency” to a deadly crisis. 

• Maienschein, in a statement: “With nearly 6,000 Californians dying each year from accidental overdoses due to illicit fentanyl, the decision to delay all legislation that looks at the public safety side of this crisis will undoubtedly cost many more people their lives.”

2 A beetle for Brown

Forget statues, roadways or public parks — perhaps the best thing to be named after you is the humble beetle.

That’s the honor recently bestowed to former California Gov. Jerry Brown, after UC Berkeley entomologist Kipling Will rediscovered the super-rare insect on Brown’s ranch in Colusa County.

On various occasions, Brown has opened up his 2,500-acre property to field researchers. Will regularly collected beetles from Brown’s ranch over the years, and one day came across a beetle that didn’t look like any he’s seen before, the UC Berkeley news service reported Monday.

Using DNA testing, Will and his colleagues confirmed that the insect, which belongs to the Bembidion genus of beetles, was distinct enough to be its own species. He then found older specimens of the insect, with the most recent sample dating back from 1966. Will dubbed the rediscovered beetle Bembidion brownorum, after the former governor and his wife, Anne Gust Brown.

Though the beetle itself is rare, the scientific naming of species after politicians surprisingly isn’t. 

In January 2017, a UC Davis entomologist named the Neopalpa donaldtrumpi moth, found in Southern California, after then-President Donald Trump. And former Gov. Arnold Schwarzenegger has a fly, plant, and even another beetle that bear his name.

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