How to wage a wage war

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Sep 12, 2023 View in browser   By Rachel Bluth Presented by HEFTY WAGER: A $25 minimum wage for health care workers looked like a long shot just a few months ago. It’s a much different story now. Senate Bill 525, which would phase in the new minimum starting next year, now appears likely to make it through the Legislature as the once-fierce opposition has largely melted away thanks to a deal cut in the final days of session, as POLITICO first reported Friday. The legislation, backed by the influential SEIU California, could easily be described as one of the most contentious bills this year — and its passage one of the more significant wins for organized labor. What changed? For one thing, the hospital industry is in better financial shape than it was at the start of the year. Distressed hospitals have been awarded $300 million in interest-free forgivable loans and a piece of a multibillion-dollar Medicaid tax, defanging some of the industry's argument that failing facilities couldn’t afford a higher wage. The politics have changed, as well. Newly minted Assembly Speaker Robert Rivas came out in support of the bill just 12 days into his tenure. That sent a powerful signal to industry opponents of a minimum wage for medical assistants, custodians, food service workers and tens of thousands of other low-wage workers in health facilities around the state. The speaker’s support “forced entities to come to the table,” said Dennis Cuevas-Romero, vice president of government affairs for the California Primary Care Association. A coalition of major players in the healthcare industry negotiated changes, including lower wages in the initial stage for rural or financially struggling health care facilities. Dialysis clinics and certain other facilities also got concessions. The biggest lever may have come from the union’s promise to stop waging expensive ballot proposition campaigns. SEIU California has spent years going after its industry foes on the ballot — most notoriously, by pursuing a series of failed initiatives on dialysis regulation. The dialysis industry secured a four-year reprieve from proposition wars. Another provision says a statewide minimum would trump local measures to raise wages, the subject of many local ballot fights. The bill will be one of the final proposals the Legislature takes up this year. It is widely expected to clear both houses on Thursday evening. Gov. Gavin Newsom hasn’t said whether he’ll sign it. We’ll know soon if he saw the writing on the wall, too. Getty Images HAPPY TUESDAY 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 rbluth@politico.com or send a shout on Twitter. DMs are open! IT’S OUR PARTY: Lawmakers, if you're looking for a spot to take a dinner break tonight, swing by the California Museum for our conversation with Newsom. Food and drinks to follow! The governor will join POLITICO’s California Bureau Chief Christopher Cadelago for a fireside chat about, among other topics: Newsom’s role in trying to reduce homelessness. His efforts on gun safety. Negotiating climate deals.  They’ll also delve into his efforts to reelect President Joe Biden while making himself a chief antagonist to Florida’s Republican governor, Ron DeSantis. You can watch the conversation live at 7 p.m.   A message from YouTube and Google: We can all use a little nudge to get off screens sometimes, and that includes teens. So to help them be more mindful of their time on YouTube, we automatically remind teens aged 13–17 to take a break, or switch off for bed. To find more online safety features for kids and teens, visit youtube.com/myfamily   WHAT YOU NEED TO KNOW TODAY STILL SMOLDERING: Lawmakers failed to strike a deal on a bill to keep property insurers in fire-prone California before the end of session this year — punting any short-term reforms to Insurance Commissioner Ricardo Lara and Newsom, whose spokesperson expressed disappointment about the lack of movement in the Legislature. “This is an issue that we know will worsen with the ongoing climate crisis,” spokesperson Alex Stack said in a statement. Lara steered clear of committing to any new rules today but said he would focus on going through insurers' requests for rate hikes more quickly. The Insurance Department is also holding a hearing later this month as it considers allowing insurers to use forward-looking modeling that could result in higher rates. The Assembly will hold public hearings this fall on the access to insurance coverage, wildfires and catastrophes, said Nick Miller, a spokesperson for Rivas. “We hear loud and clear from our residents that access to insurance is a problem,” Rivas said in a statement. “Our mission has always been to ensure homeowners and businesses across California can access and retain comprehensive insurance coverage.” — Camille von Kaenel   JOIN US FOR BREAKFAST AT THE POLITICO CALIFORNIA FOOD TRUCK! Get caffeinated and connected with POLITICO California! Are you in the Sacramento area? Do you need a jolt of coffee as you get up to speed with POLITICO’s expansion in California? If you answered “yes” to these questions, then head down to the west lawn of the Capitol building Tuesday & Wednesday, Sept. 12-13 and visit the POLITICO California breakfast truck. Discover what POLITICO has to offer in California and how we plan to cover the Sacramento political village.     ON THE BEATS SWEET SUCCESS: A bill to ban certain food additives commonly found in candies is on its way to the governor's desk. Assemblymember Jesse Gabriel's Assembly Bill 418 won final approval from the Assembly with little discussion today. Gabriel is aiming to prohibit what he says are certain harmful dyes and food chemicals that are already banned in Europe, including brominated vegetable oil, potassium bromate, propylparaben and red dye 3. A number of food industry groups fought the bill, including the National Confectioners Association. Among the backers are former California Gov. Arnold Schwarzenegger, now a fitness influencer, and actor Morgan Freeman. — Lara Korte TAKE A HIKE: Trustees are facing pushback from faculty ahead of a vote on plans to raise tuition in each of the next five years at California State University. Faculty union members and students rallied in protest of the plan in Long Beach this morning — just ahead of a vote on the proposal in the Southern California city scheduled for Wednesday morning. Trustees there will consider 6 percent annual increases as they confront a $1.5 billion deficit in the sprawling system’s budget. Despite continuous pushback from labor, most of the trustees at a meeting in July voiced support for the hikes, as the chancellor’s office argued it could not afford to keep up services despite funding increases from the state. — Forest Hunt  HAVE A SNACK WITH THAT BUD: California consumers will soon have the option to buy more than just cannabis at their local dispensary. State lawmakers approved a bill today that would allow licensed pot shops to sell food and nonalcoholic beverages. Cannabis consumption lounges — around 30 of which have popped up around the state in recent years — can also host events such as concerts. The push to pass Assembly Bill 394 comes as California’s legal weed industry struggles to reach expectations promised in a 2016 ballot initiative. Total cannabis sales are dominated by unlicensed retailers that avoid the state taxes and can sell products for significantly cheaper. — Alexander Nieves   A message from YouTube and Google:   WHAT WE'RE READING TODAY AWKWARD POLITICS: House Speaker Kevin McCarthy’s decision to open impeachment proceedings against Biden creates an awkward situation for 18 Republicans who hold seats where Biden won in 2020, including five held by vulnerable incumbents in California. (Los Angeles Times) ROOM WITH A VIEW: The Stinson Beach house that has featured prominently in the gnarly dispute among members of Sen. Dianne Feinstein’s extended family has appeared in the multiple listing service as “coming soon” at a list price of nearly $8.5 million. (San Francisco Chronicle)   Enter the “room where it happens”, where global power players shape policy and politics, with Power Play. POLITICO’s brand-new podcast will host conversations with the leaders and power players shaping the biggest ideas and driving the global conversations, moderated by award-winning journalist Anne McElvoy. Sign up today to be notified of the first episodes in September – click here.       A message from YouTube and Google: We’re making the internet safer for kids and teens. To help manage their time online, and find other safety features, visit youtube.com/myfamily     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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