POLITICO California Playbook PM: Newsom wades into the deep end

Your afternoon must-read briefing on politics and government in the Golden State

May 08, 2023 View in browser   By Camille von Kaenel MAKING A SPLASH: When Californians say water is liquid gold, they mean it. Gold Rush-era culture makes up the basis of the state’s water rights system, which essentially amounts to first come, first served. Like any 19th century artifact, the system has problems: Descendents of the first European settlers have outsize rights, clashing with growing cities. And the murky allocation has led to water-rights owners having claims to five times more water than California usually has available, according to a 2014 University of California study. Gov. Gavin Newsom and state lawmakers have recently made moves to revise the system, claiming it is ill-equipped for the weather upheaval brought by climate change. But even a hint of change has ignited suspicion among farmers, whose fortunes are built on the centuries-old rights. They are now fighting a trio of proposals in the state Legislature they say could upend their business. A family home sits in Madera County, Calif., among rows of crops. | Terry Chea/AP Photo Assembly Bill 460 by Assemblymember Rebecca Bauer-Kahan (D-Orinda) would grant more powers to the State Water Resources Control Board to more easily penalize farmers and others who take more than their share of allotted water at the expense of the environment. Assembly Bill 1337 by Assemblymember Buffy Wicks (D-Oakland) would give the Water Resources Control Board more authority to limit diversions from rivers from those who now hold the most senior water rights, from before 1914. Senate Bill 389 by Senator Ben Allen (D-Santa Monica) allows the Water Resources Control Board to better investigate water claims, especially senior pre-1914 rights, to verify whether diversions are legal. Groups such as the California Chamber of Commerce, the California Farm Bureau and the Association of California Water Agencies argue that the bills rob water rights owners of due process. Environmental groups including Trout Unlimited and the Planning and Conservation League say the state has to be more nimble to handle climate change. After the bills cleared their policy committees, opponents have — so far unsuccessfully — proposed changes to water them down. The Senate appropriations committee could decide the fate of SB 389 next week. The two Assembly bills are headed to appropriations next. Newsom, who last year opened the door to the water fight now playing out in the Legislature when he said the state should look at the issue, has since stayed publicly quiet. His January budget proposal included $31 million for an effort to digitize paper records related to water rights. (That’s how 19th-century the system is.) Expect a stormy fight on the floor.    JOIN US THIS WEEK - PLAYBOOK MEET & GREET! We did it before and we're doing it again! Join California Playbook and POLITICO’s growing team in Sacramento at Smic’s Sip & Quip on Thursday, May 11, 2023, for an evening of cocktails and conversation. As POLITICO expands in California, we're convening our most influential readers in Sacramento and beyond. Swing by and have a cocktail on us—you never know who you might run into! Register here.     HAPPY MONDAY AFTERNOON! Welcome to California Playbook PM, a POLITICO newsletter that serves as an afternoon temperature check of California politics and a look at what our policy reporters are watching. Got tips or suggestions? Shoot an email to cvonkaenel@politico.com or send a shout on Twitter. DMs are open! WHAT YOU NEED TO KNOW TODAY LABOR LOVE: Top California Democrats swung by the downtown Sheraton in Sacramento on Monday to visit some of their favorite supporters — union workers. Senate Pro Tem Toni Atkins, Assembly Speaker Anthony Rendon and Attorney General Rob Bonta gave the lunchtime remarks at the joint legislative summit between the California Labor Federation and the State Building and Construction Trades Council of California. Ahead of an updated budget that is expected to show less-than-stellar revenues, Atkins promised to protect progress on workers’ rights and avoid tax increases for the middle class. Rendon avoided the impending budget difficulties, but did re-up his support for a closely-watched bill that would let legislative workers organize. “It’s an embarrassment and it’s a hypocrisy that we don’t allow our staff to form unions,” he said. — Lara Korte On The Beats SILICON VALLEY BANK: State regulators are admitting to a role in the failure of Silicon Valley Bank. A report released today by the California Department of Financial Protection and Innovation said the bank was slow to correct deficiencies and that regulators didn’t take adequate steps to ensure problems were resolved. It comes after the release last month of a Federal Reserve report that faulted its own oversight in the third-largest bank failure in U.S. history. — Ben Fox UNCHARTED WATERS: The federal government auctioned off rights in December to develop wind power off the California coast — with five companies ponying up $757 million for a piece of the action. Now, comes the hard part. Other existing or projected offshore wind projects in the U.S. are in shallow water, with the turbines anchored to the sea floor. California would rely on massive, floating turbines – a concept heretofore tried on a smaller scale in Europe and Asia. Then there is the matter of building transmission lines from remote Humboldt County and Morro Bay to the more populated parts of a state that hope to rely on wind energy to power 3.75 million homes by 2030 and 25 million homes by 2050. There are a lot of moving pieces, all of which are under discussion today in Sacramento at the Pacific Offshore Wind Summit, where lawmakers, Newsom administration officials, regulators, wind power advocates and energy companies are gathering to come up with a game plan as the climate clock ticks away. — Wes Venteicher   TO RECYCLE OR NOT: To check if you can throw a product in the recycling bin, you probably look for the iconic “chasing arrows” symbol. Now, California’s recycling agency is starting to define which products can actually use the label, kicking off a fight between environmental groups and the industry that will reverberate nationally as regulators and lawmakers look to crack down on greenwashing, writes POLITICO’s Jordan Wolman. While recycling facilities easily process some materials like cardboard, the recyclability of other materials is up for debate after China stopped accepting most discarded products labeled as recyclable. One of those is No. 5 polypropylene, which is used in items like bottle caps, straws, potato chip bags and yogurt containers. California's Department of Resources Recycling and Recovery aims to write the new rules by 2025.   DON’T MISS THE POLITICO ENERGY SUMMIT: A new world energy order is emerging and America’s place in it is at a critical juncture. Join POLITICO on Thursday, May 18 for our first-ever energy summit to explore how the U.S. is positioning itself in a complicated energy future. We’ll explore progress on infrastructure and climate funding dedicated to building a renewable energy economy, Biden’s environmental justice proposals, and so much more. REGISTER HERE.     AROUND CALIFORNIA — “Cracks, hacks, attacks: California's vulnerable water system faces many threats,” by the Los Angeles Times’ Hayley Smith: “Compounding the problem is a lack of central regulation or uniform protocols. Multiple agencies — including the Environmental Protection Agency, the National Institute of Standards and Technology, the American Water Works Assn. and the Department of Homeland Security and CISA — provide some degree of risk management oversight, or offer frameworks and recommendations. But many of the day-to-day decisions are left up to individual operators.” — “A Bay Area homebuilder planned a project with union rules. Can it work anywhere else?,” by CalMatters’ Ben Christopher: “Upon taking over the project last year, PulteGroup’s legal team made the case to the city of Saratoga that state law does not obligate the company to abide by the union-backed standard imposed on mixed-income projects, according to emails shared with CalMatters.” — “Eviction Bans Remain in California More Than 3 Years Into the Pandemic,” by the Wall Street Journal’s Will Parker: “California landlords, who have sued local governments over eviction laws, say there is no longer any pandemic justification for many renter protections.” MIXTAPE  — “Central Valley lawmakers request $20 million for flood recovery,” by the Fresno Bee’s Melissa Montalvo  — “A Bay Area Catholic diocese filed for bankruptcy in wake of hundreds of sex abuse lawsuits,” by the San Francisco Chronicle’s Roland Li   — “After recent killings on California reservation, tribes ask for help to stem violence,” by the Los Angeles Times’ Hannah Wiley   Follow us on Twitter Katy Murphy @katymurphy POLITICO California @politicoca   Subscribe to the POLITICO Playbook family Playbook  |  Playbook PM  |  California Playbook  |  Florida Playbook  |  Illinois Playbook  |  Massachusetts Playbook  |  New Jersey Playbook  |  New York Playbook  |  Ottawa Playbook  |  Brussels Playbook  |  London Playbook View all our political and policy newsletters Follow us

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