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WhatMatters

Your guide to California policy and politics by Dan Morain

Presented by California Building Industry Association, The California Association of Realtors, American Council of Engineering Companies, Mattress Recycling Council, and Keep the Internet Free

Good morning, California.

“If they want to be in California to do business, major insurers cannot just cherry pick and cut what they deem risky and continue to do business in the more lucrative and less vulnerable areas.”—Sen. Jim Nielsen, a Republican who represents Paradise, as reported by The Sacramento Bee

  • Home insurance companies have refused to renew policies for 340,000 rural homeowners in fire-prone areas, Insurance Commissioner Ricardo Lara reported Tuesday.

PG&E’s “hail Mary”

Scenic shot of burned items from the 2018 Camp Fire in Paradise, California. March 2019. Photo by Byrhonda Lyons/CALmatters.
Camp Fire remnants, Paradise

Pacific Gas & Electric Co. Chief Executive Officer William D. Johnson will visit the Capitol today to make personal appeals to legislators for more assistance, while PG&E’s rivals are revving up their campaign to scuttle its plan.

PG&E wants legislation that would allow it to spread out as much as $40 billion in wildfire-related costs over decades. At least some of that money would be paid by ratepayers.

Tall order: With a mere three and a half weeks left before the Legislature adjourns for the year, no legislation could be considered without Senate President Pro Tem Toni Atkins and Speaker Anthony Rendon agreeing to waive rules.

Legislators have little appetite to cast votes that could be viewed as a bailout of PG&E.

Ten months after the Camp Fire ravaged his district, Republican Assemblyman James Gallagher is scheduled to meet with Johnson. It would be his first face-to-face meeting with a PG&E chief executive, 10 months after fire destroyed Paradise and killed 86 people.

  • Gallagher: “They talk, but they don’t give commitments.”

Opponents: The Agricultural Energy Consumers Association, worried about rate hikes, called PG&E’s effort a “hail Mary.” The farmers have joined with deep-pocketed hedge funds that hold $10 billion in PG&E bond debt to oppose any such legislation. 

Their public campaign opened Tuesday with a website called Stop the PG&E Bailout. It will only get more intense.

UC Merced offers a path forward

UC Merced

As universities struggle to diversify their faculties, UC Merced’s summer research program is helping first-generation college students find a path to academia, CalMatters higher education reporter Felicia Mello reports

UC Merced opened in 2005, and is the most lasting legacy of Gov. Gray Davis, who pushed for creation of a Central Valley campus. Although naysayers derided it as a boondoggle, Merced’s enrollment has grown to more than 8,000, and it is UC’s most diverse campus. About 53% of the undergraduates are Latino.

Alumni of UC’s newest campus are earning doctorates at a rate comparable to graduates of much more selective UCs. Merced’s undergraduates are more likely to help faculty with research than those at any other UC campus.

Mello caught up with some of the school’s budding academics. One is first-generation student Alejandra Santoyo from Bakersfield:

  • “I was really unsure. I thought maybe I wasn’t smart enough or good enough, being a first-generation college student.”

Santoyo studied how the brain processes rhythm, and became inspired to apply to graduate school at Stanford. She aspires to become a neuroscientist.

To read Mello’s full report, please click here.

UC labor fight could be on ballot

UC Davis Medical Center

Organized labor-backed legislation that would ask voters to decide whether to limit contract workers at the University of California moved a step closer to the 2020 ballot Tuesday.

The measure is aimed particularly at UC medical centers, which have been the focus on ongoing labor strife, much of it over out-sourcing.

Over UC’s objections, the Senate Elections Committee approved the measure by Assemblywoman Lorena Gonzalez, a San Diego Democrat. The bill must clear one more committee before reaching the Senate floor, where it almost surely would be approved.

Gonzalez contends UC turns to contract workers because they’re less expensive, and notes many of them are minorities.

  • “We can’t love UC so much that we suggest that they’re exempt from our principles of basic dignity and equality.”

UC told lawmakers that the number of full-time union workers at the system has increased from 77,333 to 85,020 in the past five years. The university says it hires contract workers when there is a dire need, especially at medical centers

  • UC’s letter to the Legislature: “UC calculates the increased operating costs at $172.6 million per year based on the additional wage and benefit premiums associated with bringing contracted work in-house.”

What’s next: The bill heads to the Senate Appropriations Committee. If it wins final legislative approval, voters would decide whether to add a constitutional amendment restricting UC’s ability to hire outside workers.

Trump flails at California

President Donald Trump

The Trump administration was blindsided by automakers’ decision to align themselves with California and its strict clean air standards, and is looking to undermine the deal, The New York Times reported Tuesday.

Remind me: 

  • California helped to formulate Obama administration fuel-efficiency and emission standards. 
  • Early in his tenure, Trump announced he would roll back the Obama rules, and strip California of its authority to set its own clean air standards.
  • Gov. Gavin Newsom announced last month that Honda, Ford, Volkswagen and BMW have agreed to adhere to California standards. Mercedes-Benz intends to join soon.

In Washington, officials working on the Trump rollback have left their post, leaving the task of revising complex fuel-efficiency standards to a 29-year-old.

The Times, citing sources who attended a meeting with the president: 

  • “Trump went so far as to propose scrapping his own rollback plan and keeping the Obama regulations, while still revoking California’s legal authority to set its own standards. … The president framed it as a way to retaliate against both California and the four automakers in California’s camp.

Newsom, as quoted in The L.A. Times

  • “This is pathetic, and it shows the weakness of the administration. No one wants [Trump’s mileage policy] except the oil companies. And what a sad, pathetic state of affairs that they’re the ones calling the shots.”

What it says: The episode is an extraordinary example of both President Donald Trump’s antipathy toward California and the administration’s ineptness.

Commentary at CalMatters

Dr. J. Douglas Kirk and Mel Levine, University of California: ACA 14 would be disastrous not only for hospitals but for the entire UC. It would prohibit UC from using contracted workers for a wide range of functions, from increased security for commencement and other special events to occasional landscapers who have specialized skills and equipment. 

Dan Walters, CalMatters: The Legislature finally changes long-standing law governing the use of deadly force by police, driven by two egregious cases in Sacramento.

Please email or call me with tips, suggestions and insights, dmorain@calmatters.org, 916.201.6281. Thanks for reading, please tell a friend and sign up here.

See you tomorrow.

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