Meanwhile, the bill to prohibit triple-digit interest rates on some consumer loans faces an uphill climb in the Senate, where it will go before its first committee next week.
And those who dug into the details of the governor's budget found it was often less than it seemed: His cancellation of the menstrual product tax, for example, would expire in two years. When a Newsom aide told a panel of lawmakers that a future decision to extend the tax break for longer would depend on the state's economic condition at that time, Democratic Assemblywoman Cristina Garcia shot back:
"Our uteruses shouldn't be used to balance our budget down the road."
The relatively restrained pace of change has come as a pleasant surprise to many political moderates and business interests. Of the 31 bills stamped with the California Chamber of Commerce's 'job killer' label—a moniker for the policies it lobbies most strongly against— lawmakers have quashed all but five.
Chamber president Allan Zaremberg attributes his organization's high success rate in a Democratic-dominated Legislature to a combination of "good lobbying and their bad ideas."
Good lobbying is expensive. The Chamber is among the biggest spenders on lobbying in Sacramento—nearly $720,000 in the year's first quarter. The Chamber joined major tech firms in lobbying against two bills that would have expanded consumer protection under a landmark data privacy measure California passed in 2018. Lawmakers quietly shelved both of them.
The oil industry—a political bogeyman for many progressives and Sacramento’s most lavish lobbying spender—is so far faring pretty well in the Democratic-controlled statehouse. Lawmakers have already killed nearly half the bills the Western States Petroleum Association lobbied on this year. That includes a bill to increase reuse of treated wastewater by restricting how much can be released into the ocean, and a proposal to prohibit new oil and gas operations within 2,500 feet of homes, schools, playgrounds and healthcare facilities.
Industry lobbying helped kill several bills meant to promote public health by limiting vaping and soda consumption. Soda companies more than tripled their spending on lobbying in Sacramento during the first three months of the year. They convinced lawmakers to jettison four of five measures backed by doctors, dentists and public health advocates that sought to limit how much sugar Californians drink. Lawmakers also snuffed out bills meant to curb teen use of e-cigarettes by banning the sale of products with enticing flavors.
The California Association of Realtors, who typically oppose restrictions on property owners, spent over $400,000 on lobbying and nearly $1 million (more than any other group) on campaign spending this year so far. That could help explain why all but one of the state's high-profile pro-renter bills have died already.
The effect of all that money may be put to the test next week as the Senate takes up a bill at the center of one of the year's biggest battles between organized labor and business interests. The Assembly has passed the proposal, which would force gig-economy companies such as Uber and Lyft to treat their contractors as employees, guaranteeing them minimum wage and other basic worker protections.
One big test of Newsom’s progressive agenda remains: whether he'll be able to increase payments to low-income Californians by changing the state tax code.
He has proposed increasing the Earned Income Tax Credit—an anti-poverty program that has historically garnered bipartisan praise—by bringing California's tax code in line with changes Republicans enacted to the federal code in 2017, such as placing new limits on the losses, workplace-related expenses and interest payments that businesses have traditionally used to lower their tax bills. The governor's office estimates that nixing those deductions would raise an extra $1.7 billion from wealthier Californians and businesses and redirect it to poor people.
"That sounds like the kind of thing you would expect to pass in a Legislature dominated by Democratic politics," said Chris Hoene, president of the California Budget and Policy Center, who supports the governor’s proposal.
But Assembly Democrats—fearful of potential political attacks—have yet to come on board.