| | | | |  | | By Wes Venteicher | Presented by California Hospital Association | POOLING POWER: California has a hard time keeping the lights on during hot summer nights, a problem that’s plagued the state’s transition to clean energy. But an attempt to solve that peak-demand conundrum by making it easier to share electricity across state lines hit a snag today. A closely watched bill that would have made California’s grid operator a nexus of energy-sharing in the West stalled today. Its author, Assemblymember Chris Holden (D-Pasadena), announced this morning that Assembly Bill 538 would not advance in the Legislature this year, despite what he called “strong and widespread interest” across the West. Shortly after Holden’s announcement, Gov. Gavin Newsom came out in support of the idea, weighing in publicly for the first time since the bill was introduced. “I look forward to our continued work with the Legislature, California stakeholders and our partners in other states to advance this important effort on enhanced regional collaboration that will benefit all the West,” Newsom said in a statement. |  Solar panels on rooftops of a housing development in Folsom, Calif., on Feb. 12, 2020. | Rich Pedroncelli/AP Photo |
Newsom’s support — if too late for Holden’s bill — could give the proposal a better shot of becoming law next year. But the governor’s timing was not lost on its backers.
“The reason the bill didn’t move is, frankly, because the governor didn’t support it or express any views on it at all,” said V. John White, executive director of the Sacramento-based Center for Energy Efficiency and Renewable Technology. “It’s good that he has, but it’s late. This is very important, because without his leadership it won’t get done.” Similar proposals have been floated over the past two decades without success, including one that Gov. Jerry Brown championed in his last term. Why do this? Studies have shown that an expanded regional grid could produce billions of dollars in benefits. It would help ensure there are more buyers for California’s excess solar power in the daytime while enhancing reliability in the evening hours when the sun sets, according to a recent publication from the National Renewable Energy Laboratory. But, then: Holden’s bill ran into heavy opposition from labor unions, who said the change would encourage energy projects outside the state, producing fewer new jobs in-state. Others warned about the risks of California ceding control over its energy supplies, creating new risks for the state’s clean-energy goals. The competition: A red-state grid operator in Arkansas, meanwhile, is trying to persuade Western states to join its regional transmission organization, the Southwest Power Pool, instead. Western states are coalescing around regional energy-sharing and around carbon-free energy. Eight states have adopted renewable energy goals, and Colorado and Nevada have passed legislation requiring utilities in their states to join a regional grid operator by 2030. “The rest of the West is moving toward the Southwest Power Pool, and California continues to act like we're not interested,” said White. “It’s very important in some way that California let states know that we want to work with them.” HAPPY WEDNESDAY 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 wventeicher@politico.com or send a shout on Twitter. DMs are open!
| | | | A message from California Hospital Association: One out of every five California hospitals are at risk of closure. Low-income residents and many people of color are especially vulnerable. Medi-Cal patients need an emergency lifeline to make sure hospitals can continue to care for those in need. Services for Medi-Cal patients need protection. Take Action Now. | | | |  | WHAT YOU NEED TO KNOW TODAY | | PASS THE COLLECTION PLATE: The ink on Newsom’s latest budget proposal has barely dried, but California mayors are already doorstepping in Sacramento asking for more money. Los Angeles Mayor Karen Bass and a dozen of her counterparts from the state’s largest cities came through town today asking for $2 billion in annual ongoing funding for local governments to address homelessness and an additional $1.5 billion for Homekey projects. They said it’s difficult to plan for shelters and other resources without permanent funding from the state. California has distributed just under $3 billion in one-time grants to cities and counties over four years. “That is a bill that comes due every month at the first of the month,” San Diego Mayor Todd Gloria said of shelters. “So we need the certainty of that funding.” The mayors met Wednesday with Newsom, Senate President pro Tem Toni Atkins, Assembly Speaker Anthony Rendon and Speaker-Designate Robert Rivas, who is set to take the gavel on July 1. Their request comes at a tough time, given the state’s $31.5 billion budget deficit, but the governor has signaled a willingness to fund such programs. His new budget proposal includes $15.3 billion for state homelessness initiatives.
| | ON THE BEATS | | FOOTING THE BILL: Newsom is ramping up his pressure campaign against national Republicans — this time against the backdrop of a slow-moving disaster in the Central Valley, where record snowmelt has already submerged farms and is threatening to flood communities. Newsom has cast Republicans as unwilling to fund critical flood protection while California steps up to front $17 million to raise a levee holding back rising waters from the city of Corcoran and a state prison complex. In a letter shared with POLITICO, Newsom singled out House Speaker Kevin McCarthy and Rep. David Valadao, Republicans who represent the region. A Valadao spokesperson said the letter is “political posturing” and that California members of Congress have been working on getting additional federal support. — Camille von Kaenel NEW PRICE TAG: Newsom’s signature proposal to bring undocumented people of all ages into Medi-Cal could cost about twice as much as he said it would in January. The nonpartisan Legislative Analyst’s Office estimates that over time, expanding the state’s Medicaid program could cost up to $4 billion per year, rather than $2 billion, as POLITICO previously reported. The new price tag for the next fiscal year is $1.2 billion, roughly twice what was set aside in January. Behind the revised estimate is a higher cost per enrollee, driven by factors like higher rates from health plans and a policy change in how the federal government makes the state calculate costs. People without access to comprehensive health care are also generally sicker and have more unmet needs, so the cost to treat them will likely go down once they’re integrated into the health system and having their conditions treated, the LAO predicted. Regardless, Newsom and other Democratic leaders seem committed to seeing the expansion through. — Rachel Bluth FIREFIGHTING FORCE: As lawmakers seek out their own solutions to California’s nearly $32 billion budget problem, one expense they’re questioning is the hiring of more firefighters. Last year’s budget set aside more than $400 million to hire about 1,500 people over four years to battle the state’s raging wildfires, and Newsom’s proposals for this year’s budget left those plans intact. Today, Assemblymember Steve Bennett (D-Ojai) noted that following through with the hires would create an ongoing expense as California enters what could be a protracted period of budget deficits. “I think it’s important to be conscious of adding to base spending,” Bennett said. The hiring plan includes 455 positions meant to help provide breaks for firefighters who are often stuck on fire lines for weeks at a time, which can harm mental health and family relationships.
| | | | A message from California Hospital Association:   | | | | | AROUND CALIFORNIA | | — “Evictions, homelessness, debt: Skid Row Housing Trust receiver has checkered history,” by the Los Angeles Times’ Liam Dillion: Since Harmony took over, it’s filed about a dozen eviction lawsuits and is threatening more, according to Mariah Thompson, an attorney with California Rural Legal Assistance, a nonprofit that is representing Shawn and other park residents. Last month, Harmony told residents the park would close next April. — “California has tried to cut the cost of insulin for years. Why it might finally succeed,” by CalMatters’ Kristen Hwang: The answer lies in a complex and convoluted system of rebates that drug companies pay pharmaceutical benefit managers. Pharmaceutical benefit managers control the list of drugs that health insurance plans cover, also known as a formulary. — “Chevron scrambles to batten down oil fields amid threat of Kern River flooding,” by the Los Angeles Times’ Louis Sahagún: For Chevron, the idled wells would represent a slight reduction in the overall number of barrels per day it sends to refineries in El Segundo and Northern California, where crude oil is converted into diesel and jet fuel, and gasoline for the cars of Southern California. Compiled by Ramon Castaños
| | MIXTAPE | | — “A Black astronaut from California feels the weight of injustice on Earth,” by the Los Angeles Times’ Tyrone Beason — “Gavin Newsom budgets millions for flood recovery. Will it help this Central Valley town?,” by the Fresno Bee’s Melissa Montalvo — “S.F.’s legendary Hetch Hetchy reservoir turns 100. What’s next?,” by the San Francisco Chronicle’s Claire Hao
| | | | A message from California Hospital Association: Medi-Cal underfunding discriminates against the most vulnerable Californians. California pays only 74 cents for every dollar it costs to care for Medi-Cal patients which puts women, children, people of color, and low-income residents at risk. The risks we face are hospital closure, bankruptcy, or diminished health care services. One hospital has already closed in 2023. Many others are shuttering services. More will follow. Please PROTECT patient care.
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