Governor Gavin Newsom
On January 7, 2019, Gavin Newsom was officially sworn in as California’s 40th Governor. During his swearing-in ceremony, he reiterated his various goals and priorities for the state that he strongly pursued on the campaign trail, including the expansion of early childhood education, a commitment to achieve healthcare for all, addressing the state’s homelessness and housing crisis, and establishing his overarching theme of “California for All.” The theme of “California for All” isn’t just serving as a theme for the Newsom Administration, it is also serving as yet another attempt to significantly distinguish California from the national narrative of what is happening in Washington D.C.
Legislative Leadership At-A-Glance
The beginning of 2019 brought new leadership in the both the Assembly and Senate Republican Caucuses with members of the minority party electing women to leadership roles, signaling a new direction being taken after election losses for Republicans in 2018.
Assembly Republicans welcomed their new Leader, Assemblywoman Marie Waldron. Waldron was elected to the post after her predecessor, Assemblyman Brian Dahle stepped down to run in the special election for State Senate District 1, which he later won. Waldron serves constituents in a district which encompasses portions of Riverside and northern San Diego County.
Senate Republicans also welcomed their new Leader, Senator Shannon Grove. In a move that seemed to indicate a significant conservative shift, Grove was elected to take over the role previously held by Senator Patricia Bates of Laguna Niguel. Grove serves constituents in a district which consists of the southeastern Central Valley and the High Desert, encompassing portions of Kern, San Bernardino, and Tulare County.
Two roles remain unchanged, however, as Assembly Speaker Anthony Rendon and Senate President Pro Tempore Toni Atkins both maintained their Leadership roles, in their respective Houses.
Governor Newsom signed his first $214.8 billion California budget ($147.8 billion General Fund) on June 27th, a budget which reflects the projected “extraordinary” $21.5 billion surplus that the state has, while helping tackle affordability challenges plaguing Californians.
Following in the footsteps of former Governor Jerry Brown, California is stockpiling for an anticipated downturn, and thus, “building budget resiliency.” This year’s budget holds a $19.2 billion reserve from several rainy-day funds. According to the Legislative Analyst’s Office, the state would need close to $40 billion to cover the budget in even a moderate recession. If an economic downturn were to occur, these savings would be largely wiped out.
Newsom’s “California for All” budget directs billions of dollars to programs that help undocumented immigrants, new parents, and low-income taxpayers. This includes funding to increase California’s paid family leave plan from six to eight weeks, ending sales taxes on diapers and feminine hygiene products for two years, and making eligible 3 million California households for the state’s earned income tax credit (EITC), a benefit that gives lower-income families as much as $2,559 a year. The budget also expands Medi-Cal coverage to all income-eligible undocumented young adults ages 19 through 25 and invests $1.45 billion over the next three years to help middle-income people afford health insurance.
As California’s homeless and housing crises have been front and center for the entirety of Newsom’s time in office thus far, the budget includes $2.75 billion to address these concerns. This include $650 million to local governments to combat homelessness, $250 million to help cities and counties plan for new housing, $500 million for a mixed-income loan program through the California Housing Finance Agency, and $5 million in grants to homeless shelters so they can accommodate pets.
Advocates estimate that more than a million people in the state do not have access to clean drinking water. The Newsom administration initially proposed a new tax to remedy the problem, but legislators ultimately rejected it. However, an agreement was reached to use money ($130 million) from California’s “cap-and-trade” program to improve local water systems, generally in disadvantaged communities.
The budget also includes a plan to impose a fee on phone bills to pay for improvements to the state’s 911 system. The money is aimed at upgrading California’s dated system to “Next Generation 911,” a system that will have more precise call location data and expanded texting capabilities.
Coming off the heels of the state’s deadliest wildfire season in history, the budget invests $127.2 million for C-130 Air Tankers and twenty-first century firefighting helicopters, and $130.3 million for better communication equipment for first responders.
Details on the 2019-20 State Budget can be accessed at www.ebudget.ca.gov.
Over the last decade, the number of private Proposition 65 actions against businesses has nearly quadrupled. Supplementary Prop 65 regulations on “safe harbor” warnings and online retailers that took effect last August, clarifying the duties of online retailers regarding warnings, appears to have triggered a decrease in new Prop 65 actions against online retailers. Nevertheless, notices concerning chemicals in plastics have increased substantially. Likewise, notices for chemicals in food products have significantly increased.
The Prop 65 enforcement environment changes constantly. The Office of Environmental Health Hazard Assessment (OEHHA) recurrently adds and removes chemicals from the Prop 65 list. Compliance obligations for certain chemicals is always subject to change based on continuing challenges regarding chemical safety levels in consumer goods, as well as environmental exposures.
We will continue to follow regulatory issues closely in 2020 and monitor for any new and onerous requirements that could potentially be placed on the wine industry.
Throughout the year, FWC worked to maintain a close relationship with ABC. This included hosting a winery tour and associated training event. The site visit training session was utilized to educate and expose ABC staff to common circumstances that often are the basis for questions wineries receive at their ABC Offices. It also provided an opportunity for ABC staff to hear from HQ Management as to the proper response/permit/license as applied to each question/scenario.
FWC, along with Political Solutions, will continue relationship maintenance and building with ABC in 2020. Issues that will be on the forefront will include ABC Responsible Beverage Service Training (Assembly Bill 1221). While the law is a positive step forward in encouraging training of alcohol servers in California, the regulations are far-reaching and problematic due to their rushed nature. FWC will work with industry to attempt to find some relief and clarification going forward.
Additional Relationship Building
In 2019, Political Solutions was pleased to offer our clients the opportunity to support and network with several legislators via exclusive fundraising events available only to the firm’s clients. Political Solutions appreciates your continuing engagement in our events, and we look forward to bringing our client’s more opportunities in 2020.
- • Assemblymember Evan Low – February 19, 2019 at Brasserie Capitale, Sacramento
- • Assembly Republican Leader Marie Waldron – March 4, 2019 at DownTown & Vine, Sacramento
- • Assemblyman Bill Brough – March 25, 2019 at 58 Degrees & Holding, Sacramento
- • Senate President Pro Tem Toni Atkins – May 10, 2019 at The Red Barn, Napa
- • Senator Brian Jones – June 5, 2019 at DownTown & Vine, Sacramento
- • Sen. Susan Rubio & Asm. Blanca Rubio – June 17, 2019 at Camden Spit & Larder, Sacramento
- • Senator Steve Glazer – June 24, 2019 at TableVine, Sacramento
- • Senator Anthony Portantino – June 25, 2019 at Brasserie Capitale, Sacramento
- • Assembly Speaker Anthony Rendon – June 26, 2019 at DownTown & Vine, Sacramento
- • Assemblymember Cottie Petrie-Norris – August 12, 2019 at Political Solutions Office, Sacramento
- • Senator Melissa Hurtado – September 17, 2019 at DownTown & Vine, Sacramento
- • Assemblymember Cecilia Aguiar-Curry – October 21, 2019 at Preserve, Winters
FWC can anticipate another robust year of these events in 2020.
Looking Ahead: 2020
Reflecting on all the legislative, regulatory, and political events of 2019, 2020 is also shaping up to be yet another exciting and jam-packed legislative year. Political Solutions looks forward to continuing to represent FWC and working on issues affecting their membership. Here’s to our combined success in 2020.