Secret negotiations for major policy changes

Welcome to one of the most secretive yet commonplace practices in Sacramento, where each year, Gov. Gavin Newsom, Assembly Speaker Robert Rivas and Senate President Pro Tem Mike McGuire and their staff meet in private to reach last-minute agreements on major policy changes and funding allocations before the clock runs out. 

Those deals — often unveiled at the eleventh hour — will likely become law as is, because there is little to no room for changes by the time they are announced. And there’s rarely any appetite or momentum among the Democratic supermajority to tinker with the final product of the top Democrats’ negotiations. 

This year, as talks stall, the future of California’s environmental policies hangs in the balance. Still up in the air are proposals to reauthorize cap and trade, the state’s signature climate program that charges polluters to emit greenhouse gas, until 2045; create a regional electricity market with other western states; replenish the state’s wildfire funds and boost in-state oil production. 

To accomplish that before session ends on Friday, lawmakers must finalize the language of those proposals and put it in print by early Wednesday morning, as required by a 2016 voter-approved law designed to give the public at least 72 hours to review bills before they are voted on. 

But the leaders had announced no deals by Monday and released no details about the talks on any of the environmental issues. Frustrated, some lobbyists and advocates turned to leaked draft language by news outlets for information. The down-to-the-wire dealmaking drew fierce opposition from trade groups and environmental justice advocates alike, who urged lawmakers to avoid a hasty deal.

Details on state lawmakers’ other policy reforms — introduced as “budget trailer bills” that govern how state funds are spent — just started to roll out early Tuesday morning. And the fate of the transit funding, which advocates say would keep the Bay Area’s transit systems from collapsing, remains obscure as talks continue. 

No one from the governor’s office or the legislative leaders’ offices responded to CalMatters’ questions about the private negotiations by press time.

‘The way our system works’

The secretive process is par for the course, but it’s notable that so many of the most consequential issues are still unknown. 

Former Assembly Speaker Anthony Rendon, a Los Angeles Democrat running to be the state superintendent of public instruction, said withholding details of negotiated deals until the last minute raises their chances of passing by allowing lobbyists less time to object and lawmakers less time to mull over their votes.

“A kicker is about to kick a game-winning field goal and you call a timeout to make them nervous. The longer things go on, the more nervous people get,” he said. 

“Is that the best thing to do? Is that the most democratic thing to do? No. That’s the way our system works.”

Transparency advocates argue the public should have more, not less, time to review and weigh in on legislative proposals before they become law.

“If we are pushing things ‘til the very end of session, and there is no meaningful opportunity for the public to engage, then you are putting reporters and the public in a position of getting to digest what the new law is, instead of being able to … at least let their concerns be heard,” said Brittney Barsotti, a lobbyist for the California News Publishers Association.

Some lobbyists bemoaned the lack of transparency, arguing the uncertainty made their jobs more difficult. 

“It’s hard to know sometimes what we are advocating (for) because so many of the details have yet to be released,” said Victoria Rome, a longtime lobbyist with the Natural Resources Defense Council, which supports the reauthorization of cap and trade and a regional electricity market. 

“We’re kind of just waiting and hoping that it’s something that we can support,” she said. “(It’s) like, are we needed at all?”

The looming uncertainty is already undermining Democratic leaders’ climate agenda. Jodie Muller, chief executive of the powerful oil industry lobbying group Western States Petroleum Association, criticized lawmakers for not releasing any bill language on cap and trade despite months of conversations. The organization joined other lobbying juggernauts on Monday to oppose the reauthorization of the program.

“To be rushing something through is the wrong approach,” Muller told CalMatters. “No deal is going to be better than a bad deal.”

Governing by trailer bills

While the fate of climate policies remains elusive, lawmakers on Monday night began rolling out a series of budget trailer bills. Those measures allow lawmakers to pass last-minute laws without going through the monthslong public hearing process, and have become vehicles for both major reforms and pet projects for lawmakers in recent years.

The governor and legislative leaders have increasingly used the budget process and trailer bills to swiftly enact laws. Earlier this year, a sweeping proposal to uproot California’s landmark environmental law to make way for urban residential development was tucked into a budget trailer bill, Rome noted. 

“It just makes it even harder for advocates and the public to track what’s going on,” she said.

One trailer bill this week seeks to address the impact of federal funding cuts to Medicaid under President Donald Trump, which Newsom and state officials estimated could cost the state $28.4 billion. The bill, details of which were published Tuesday morning, would provide funding for abortion services, exempt more undocumented immigrants from paying monthly Medi-Cal premiums and establish the state’s own vaccine guidance as the Centers for Disease Control and Prevention restricts COVID-19 vaccine eligibility. 

Another trailer bill on land use, released late Monday night, includes language that critics say is narrowly tailored to kill a controversial apartment complex project in Santa Barbara. The bill would apply environmental regulations now exempted for most urban developments to projects that meet a whole set of narrowly defined criteria on population, location and acreage. 

The only project to meet all the criteria is a proposed 270-unit apartment building in Santa Barbara, where newly elected Senate President Pro Tem Monique Limón resides, said housing advocate Jordan Grimes.

“Is the incoming leader of the California Senate sneakily trying to kill” the project? Grimes asked. “It certainly seems like it!”

In a statement Tuesday, Limón denied the accusation, calling the legislation a “cleanup bill” requiring environmental reviews when a development poses a risk to safety, rather than a specific carve-out to block one project. She did not immediately point to other projects that also fit the bill.

Transit funding flip-flop

In the Bay Area, transit advocates are experiencing a roller coaster ride amid the on-again, off-again backroom negotiations over a $750 million loan to tide over Bay Area’s regional transit net, as transit operators warn of service cuts.

While the loan was included in a June budget agreement, Newsom and Bay Area lawmakers tussled over the loan terms. Last Friday, Newsom’s Department of Finance alerted Sen. Scott Wiener, a San Francisco Democrat who’s pushed for transit funding for years, that the deal would not be finalized. Yet on Monday, following a weekend of calls from San Francisco Mayor Daniel Lurie and union workers, Newsom said he looks forward to striking a deal in the fall. 

But it is unclear why Newsom changed his mind and when a deal might be reached. Both Newsom and Wiener declined to elaborate on their differences or how a deal would be implemented after the Legislature leaves Sacramento this Friday. 

“We don’t have an agreement with the administration, so there’s nothing to disclose,” Wiener told CalMatters. “Once there’s an agreement, that’ll be completely public and transparent.”

The flip-flop left some Democrats frustrated. 

“I expect better of Democratic leaders,” said Matt Dorsey, a Democrat and District 6 Supervisor of San Francisco. “I would expect chaos and uncertainty from the Republicans in Washington — but with the eyes of America on our city and our state, let’s show them how Democrats can govern equitably so that we’ve got transit and paratransit and all the economic opportunities.”

CalMatters housing reporter Ben Christopher contributed reporting. CalMatters.org is a nonprofit, nonpartisan media venture explaining California policies and politics.