The audit will also review the past two years of the system’s transactions as it relates to Musk’s assertion of “alleged fraudulent payments,” according to a letter from Loren J. Sciurba, Treasury’s deputy inspector general, that was obtained by The Associated Press.

The audit marks part of the broader effort led by Democratic lawmakers and federal employee unions to provide transparency and accountability about DOGE’s activities under President Donald Trump’s Republican administration. The Musk team has pushed for access to the government’s computer systems and sought to remove tens of thousands of federal workers.

“We expect to begin our fieldwork immediately,” Sciurba wrote. “Given the breadth of this effort, the audit will likely not be completed until August; however, we recognize the danger that improper access or inadequate controls can pose to the integrity of sensitive payment systems. As such, if critical issues come to light before that time, we will issue interim updates and reports.”

Treasury’s inspector general began the audit before Democratic lawmakers asked for it. A. J. Altemus, acting counsel to the inspector general, said “our work is independently initiated” and standards dictate that the audit “must be non-partisan and objective. These standards remain unchanged.”

Concerns Over Musk’s Team

Tech billionaire Musk, who continues to control Tesla, X and SpaceX among other companies, claims to be finding waste, fraud and abuse while providing savings to taxpayers. Many of his claims are so far unsubstantiated. But there is a risk that his team’s aggressive efforts could lead to the failure of government computer systems and enable Musk and his partners to profit off private information maintained by the government.

The audit would overlap with increased pressure that the Trump administration is placing on inspectors general, presidential appointees who are supposed to serve as an independent check against mismanagement and abuse of government power. In January, the administration fired several independent inspectors general at government agencies, a move that some members of Congress said violated federal oversight laws. The firings prompted a lawsuit filed on Wednesday in federal court in Washington that seeks to return the inspectors general to their jobs.

Democratic Sens. Elizabeth Warren of Massachusetts and Ron Wyden of Oregon led the push in the Senate for the inspector general office’s inquiry at the Treasury.

On Wednesday, Warren, Wyden and Sen. Jack Reed, D-Rhode Island, sent a letter to Treasury Secretary Scott Bessent noting the inconsistencies in the accounts provided by his department about DOGE.

“Your lack of candor about these events is deeply troubling given the threats to the economy and the public from DOGE’s meddling, and you need to provide a clear, complete, and public accounting of who accessed the systems, what they were doing, and why they were doing it,” the Democratic lawmakers wrote in their letter.

Democrats on the House Committee on Oversight and Government Reform also called on inspectors general to investigate DOGE and welcomed the Treasury audit.

Conflicting Information and Legal Challenges

The Treasury Department provided conflicting information about DOGE’s access to the payment system. Initially, it claimed the access was read only, only to then acknowledge that a DOGE team member briefly had the ability to edit code, and then to say in an employee-sworn statement that the ability to edit was granted by accident.

The 25-year-old employee granted the access, Marko Elez, resigned this month after racist posts were discovered on one of his social media accounts, only for Musk to call for his rehiring with the backing of Trump and Vice President JD Vance.

Earlier this week, the Treasury declined to brief a pair of the highest-ranking lawmakers on the Senate Finance Committee, including Wyden, on the controversy related to DOGE’s use of Treasury payment systems, citing ongoing litigation.

Advocacy groups and labor unions have filed lawsuits over DOGE’s potentially unauthorized access to sensitive Treasury payment systems. Five former treasury secretaries have sounded the alarm on the risks associated with Musk’s DOGE access.

A federal judge in Manhattan on Friday heard arguments in a lawsuit brought by Democratic state attorneys general seeking to prevent DOGE from accessing Treasury Department data.

Judge Jeannette Vargas said she’d issue a decision at a later date and a temporary restraining order imposed by a prior judge would remain in place until then.

Lawyers for the federal government argued that Treasury and DOGE staffers were acting appropriately.

“There was nothing unlawful about Treasury carrying out the priorities of a new administration using Treasury employees,” said Jeffrey Oestericher, of the U.S. Attorney’s Office for the Southern District of New York. “They were perfectly within their lawful duties.”

But Vargas at times pushed back at the federal government’s arguments that adequate protections were in place, noting that the plans were set in motion only in a matter of weeks. “Why so rushed?” she asked.

Lawyers for the Democratic attorneys general argued there was no effort to remove or redact private individual information and no evidence that DOGE staff were given proper training on how to handle such sensitive data.

“States have had their bank account information accessed by people with no reason to access it,” said Andrew Amer of the New York attorney general’s office.

___

Associated Press writer Philip Marcelo in New York contributed to this report.

___

This story has been corrected to show the Treasury deputy inspector general’s surname is Sciurba, not Sciburba.

___

Follow the AP’s coverage of the U.S. Department of the Treasury at https://apnews.com/hub/us-department-of-the-treasury.

The post Treasury Watchdog Audits Musk DOGE Team’s Access to Payment System appeared first on GV Wire.

Musk, one of President Donald Trump’s most powerful advisers, has orchestrated an unprecedented financial incentive for people to leave their government jobs, promising several months of pay in return for their resignation. The worker, who spoke on condition of anonymity for fear of retribution, wants to take the money and move overseas.

But she’s worried. What if the offer is too good to be true? What if this is really a covert effort to make a list of disloyal government employees?

Her situation is a microcosm of the uncertainty sweeping through the federal government, which is the country’s single largest employer. More than 2 million workers — analysts, nurses, scientists, accountants, food inspectors and loan processors — face a deadline of 11:59 p.m. EST Thursday to decide if they should leave.

Related Story: Inside Musk’s Power Play to Reshape the Federal Government

Trump Administration Urges Workers to Take the Deal

The deferred resignation program is part of Trump’s plan to remake the federal government, weakening what allies describe as the “deep state” that undermined the Republican president during his first term. Administration officials said they can save taxpayer money by presenting employees with “a valuable, once-in-a-lifetime opportunity” to stop working while still collecting a paycheck until Sept. 30.

On Wednesday, the administration ramped up its pressure on employees to leave, sending a reminder that layoffs or furloughs could come next.

“The majority of federal agencies are likely to be downsized through restructurings, realignments, and reductions in force,” said the message from the Office of Personnel Management, which has been a nexus of Musk’s efforts to downsize the government.

The email said anyone who remains will be expected to be “loyal” and “will be subject to enhanced standards of suitability and conduct as we move forward.” Some employees could be reclassified to limit civil service protections as well.

“Employees who engage in unlawful behavior or other misconduct will be prioritized for appropriate investigation and discipline, including termination,” the email said.

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Democrats and Unions Warn That Workers Could Be Stiffed

Democrats said workers shouldn’t accept the deferred resignation program because it wasn’t authorized by Congress, raising the risk they won’t get paid. Unions have sued to stop Trump’s plans, and a judge will consider whether to block the financial offer at a hearing Thursday afternoon in Boston.

“It’s a scam and not a buyout,” said Everett Kelley, president of the American Federation of Government Employees.

Kelley said he tells workers that “if it was me, I wouldn’t do it.”

An employee at the Department of Education, who also spoke on condition of anonymity out of fear of retaliation, said the administration appeared desperate to get people to sign the agreement. However, she said there were too many red flags, such as a clause waiving the right to sue if the government failed to honor its side of the deal.

Related Story: Elon Musk’s DOGE Gains Access to Social Security, Medicare Payments

The Deal Is ‘Exactly What It Looks Like,’ Says Trump Official

Trump put Musk, the world’s richest man, in charge of the so-called Department of Government Efficiency, which is a sweeping initiative to reduce the size and scope of the federal government. The original email offering the deferred resignation program was titled “Fork in the road,” echoing a similar message that Musk sent Twitter employees two years ago after he bought the social media platform.

Trump administration officials have organized question-and-answer sessions with employees as the deadline approaches.

Rachel Oglesby, the chief of staff at the U.S. Department of Education who previously worked at the America First Policy Institute, said Trump is trying to reduce the federal workforce.

“I know there’s been a lot of questions out there about whether it’s real and whether it’s a trick,” she said, according to a recording obtained by The Associated Press. “And it’s exactly what it looks like. It’s one of the many tools that he’s using to try to achieve the campaign promise to bring reform to the civil service and changes to D.C.”

The issue was also discussed during a meeting with Department of Agriculture employees, according to another recording obtained by the AP. Marlon Taubenheim, a human resources official, acknowledged that “these are very trying times” and “there’s a lot of stress.”

“Unfortunately, we don’t have all the answers,” he said.

Jacqueline Ponti-Lazaruk, another agency leader, said employees “probably didn’t have the runway of time that you might have liked to make a life-changing decision.”

For those who remain, she said, “we’ll just keep plugging along.”

Assurances from administration officials have not alleviated concerns across a range of agencies. Some federal workers said they did not trust the validity of the offers, doubting that Trump has the authority to disburse money. Others point to his record of stiffing contractors as a New York real estate mogul.

Musk’s Plans Spark Demonstrations in Washington

Scattered protests have sprung up outside federal buildings, including on Tuesday at the Office of Personnel Management.

“I’m taking a risk and being bold and trying to get more federal workers to take a risk to speak out,” said Dante O’Hara, who said he works for the government. “Because if we don’t, then we’re all going to lose our jobs and they’re going to put all these loyalists or people that will be their shock troops.”

Government jobs have often been considered secure positions, but O’Hara said there’s fear in the workforce. The sense from his colleagues is “I don’t know if I’m going to be here tomorrow because, like, we don’t know what’s going to happen.'”

Dan Smith, a Maryland resident whose father was a research scientist at the U.S. Department of Agriculture, said federal workers are “so underappreciated and so taken for granted.”

“It’s one thing to downsize the government. It’s one thing to try to obliterate it,” Smith said. “And that’s what’s going on. And that is what is so frightening and disgusting and requires pushback.”

Mary-Jean Burke, a physical therapist for the Department of Veterans Affairs in Indianapolis, said she’s worried that too many people will leave, jeopardizing health care services.

Burke, who also serves as a union official, said doubts have also been growing over whether to take the offer.

“Originally, I think people were like, ‘I’m out of here,'” she said. But then they saw a social media post from DOGE, which said employees can “take the vacation you always wanted, or just watch movies and chill, while receiving your full government pay and benefits.”

The message backfired because “that kind of thing sounded a little bit too good to be true and people were hesitant,” Burke said.

Either way, she said, Trump has achieved his apparent goal of shaking up the federal workforce.

“Every day, it’s something,” Burke said. “If he signed up to be a disrupter, he’s doing it.”

The post Federal Workers Debate Legitimacy of Financial Incentives to Quit as Deadline Nears appeared first on GV Wire.

He’s looking on his first day to increase domestic energy production and stop diversity, equity and inclusion programs within the federal government, among other actions.

An incoming president signing a flurry of executive orders is standard practice. Executive orders allow a president to wield power without action from Congress. But there are also limits to what orders can achieve.

Understanding Executive Orders

Basically, they are signed statements about how the president wants the federal government to be managed. They can be instructions to federal agencies or requests for reports.

Many orders can be unobjectionable, such as giving federal employees the day after Christmas off. They can also lay out major policies. For example, President Joe Biden signed an order to create a structure for establishing regulations on artificial intelligence. But executive orders — and their policy sausage-making siblings, the proclamation and political memorandum — also are used by presidents to pursue agendas they can’t get through Congress.

New presidents can — and often do — issue orders to cancel the orders of their predecessors.

As the American Bar Association notes, the orders do not require congressional approval and can’t be directly overturned by lawmakers. Still, Congress could block an order from being fulfilled by removing funding or creating other hurdles.

Related Story: Trump Returns to Power After Unprecedented Comeback, Emboldened to Reshape US

Frequency of Executive Orders

Throughout U.S. history, there have been several thousand executive orders, according to data collected by the American Presidency Project at the University of California, Santa Barbara. George Washington signed eight executive orders, while Franklin Delano Roosevelt did 3,721.

During his first term, Trump, a Republican, signed 220.

Biden, a Democrat, signed 160 as of Dec. 20.

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Political Messaging and Limitations

Trump forecasted signing as many as 100 executive orders on his first day, possibly covering deportations, the U.S.-Mexico border, domestic energy, Schedule F rules for federal workers, school gender policies and vaccine mandates, among other Day 1 promises made during his campaign. He’s also promised an executive order to give more time for the sale of TikTok.

Trump had asked Rep. Jeff Van Drew, R-N.J., to write an order stopping the development of offshore windmills for generating electricity. But it’s entirely possible that Trump could also roll out many planned executive orders over time.

Many of Trump’s measures are likely to draw Democratic opposition.

And in several major cases, the orders will largely be statements of intent based off campaign promises made by Trump.

Both Congress and the courts can potentially block executive orders.

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For example, Congress in 1992 revoked an executive order by then-President George H.W. Bush that would establish a human fetal tissue bank for scientific research by passing a measure that the order “shall not have any legal effect.” Congress can also deny funding to agencies and hamstring the enforcement of an order.

There are also legal challenges based on the argument that a president exceeded his legal authorities. When President Harry Truman tried to seize steel mills during the Korean War, the U.S. Supreme Court said he lacked the authority to take private property without authorization from Congress.

The post What Is an Executive Order? A Look at Trump’s Tool for Quickly Reshaping Government appeared first on GV Wire.

The 39-year-old from Cincinnati had been weighing a campaign for Ohio governor in 2026 and hoped to build his policy portfolio as partner to billionaire Elon Musk leading a non-governmental effort to cut federal government spending, regulations and personnel.

Conversations with Trump About Senate Seat

But in recent weeks, Ramaswamy had multiple conversations with President-elect Donald Trump about filling the Senate seat, according to one of the people. That person said Trump approached Ramaswamy to consider taking the seat as someone familiar with Trump’s goal of slashing the federal bureaucracy.

The people with direct knowledge of Ramaswamy’s interest in the Senate seat spoke on condition of anonymity to disclose a private discussion.

Trump’s transition team did not immediately respond to requests for comment.

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Governor’s Appointment and Future Election

Ohio’s Republican Gov. Mike DeWine will appoint the successor to Vance, who was elected to the Senate in 2022 but is scheduled to be sworn in as Republican President-elect Donald Trump’s vice president on Monday.

The person DeWine appoints will serve until December 2026. They would need to run again for the remainder of the term in November 2026.

“Neither Gov. DeWine nor our office has commented on any possible candidates for the pending appointment,” Dan Tierney, a spokesperson for the governor’s office, said in a statement.

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Ramaswamy’s Political Journey

Ramaswamy waged an outsider bid for the 2024 Republican presidential nomination last year but suspended his campaign after a fourth-place finish in Iowa’s leadoff precinct caucuses. Ramaswamy endorsed Trump, and became a regular surrogate for the campaign, headlining fundraisers in battleground states.

Ramaswamy had expressed interest in the Senate seat after the election, but originally took his name out of consideration as he was asked to help lead the Department of Government Efficiency, an outside effort with Musk to drastically reduce the size and cost of government.

A spokesperson for Ramaswamy did not immediately reply to a request for comment.

Ramaswamy’s renewed interest in the seat was first reported by The Washington Post.

The post Vivek Ramaswamy, an Ohio Native, Is Interested in Filling Vance’s Old Senate Seat, AP Source Says appeared first on GV Wire.

SACRAMENTO — The California Senate advanced a set of ambitious reparations proposals Tuesday, including legislation that would create an agency to help Black families research their family lineage and confirm their eligibility for any future restitution passed by the state.

Lawmakers also passed bills to create a fund for reparations programs and compensate Black families for property that the government unjustly seized from them using eminent domain. The proposals now head to the state Assembly.

State Sen. Steven Bradford, a Los Angeles-area Democrat, said California “bears great responsibility” to atone for injustices against Black Californians.

“If you can inherit generational wealth, you can inherit generational debt,” Bradford said. “Reparations is a debt that’s owed to descendants of slavery.”

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Reparations Proposals

The proposals, which passed largely along party lines, are part of a slate of bills inspired by recommendations from a first-in-the-nation task force that spent two years studying how the state could atone for its legacy of racism and discrimination against African Americans. Lawmakers did not introduce a proposal this year to provide widespread payments to descendants of enslaved Black people, which has frustrated many reparations advocates.

In the U.S. Congress, a bill to study reparations for African Americans that was first introduced in the 1980s has stalled. Illinois and New York state passed laws recently to study reparations, but no other state has gotten further along than California in its consideration of reparations proposals for Black Americans.

California state Sen. Roger Niello, a Republican representing the Sacramento suburbs, said he supports “the principle” of the eminent domain bill, but he doesn’t think taxpayers across the state should have to pay families for land that was seized by local governments.

“That seems to me to be a bit of an injustice in and of itself,” Niello said.

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Opposition and Support

The votes come on the last week for lawmakers to pass bills in their house of origin, and days after a key committee blocked legislation that would have given property tax and housing assistance to descendants of enslaved people. The state Assembly advanced a bill last week that would make California formally apologize for its legacy of discrimination against Black Californians. In 2019, Democratic Gov. Gavin Newsom issued a formal apology for the state’s history of violence against and mistreatment of Native Americans.

Some opponents of reparations say lawmakers are overpromising on what they can deliver to Black Californians as the state faces a multibillion-dollar budget deficit.

“It seems to me like they’re putting, number one, the cart before the horse,” said Republican Assemblymember Bill Essayli, who represents part of Riverside County in Southern California. “They’re setting up these agencies and frameworks to dispense reparations without actually passing any reparations.”

It could cost the state up to $1 million annually to run the agency, according to an estimate by the Senate Appropriations Committee. The committee didn’t release cost estimates for implementing the eminent domain and reparations fund bills. But the group says it could cost the state hundreds of thousands of dollars to investigate claims by families who say their land was taken because of racially discriminatory motives.

Chris Lodgson, an organizer with reparations-advocacy group the Coalition for a Just and Equitable California, said ahead of the votes that they would be “a first step” toward passing more far-reaching reparations laws in California.

“This is a historic day,” Lodgson said.

The post Reparations Proposals for Black Californians Advance to State Assembly appeared first on GV Wire.

Yue Stella Yu

CalMatters

Two years later, some of the same legislators who backed the measure want to water it down — and they have the backing of developers and labor unions.

Sen. Bill Dodd, a Napa Democrat, is championing a bill to loosen restrictions on how much — and when — local elected officials can accept in campaign cash from interest groups who would benefit financially from those officials’ pending decisions. The bill would also exempt certain industries — such as some labor unions and housing developers — from those restrictions to prevent “pay to play.”

“It has become very apparent that there are problems,” Dodd said of the existing law. “The law essentially freezes out a sector of the community from donating anything directly to candidates.”

Senate Bill 1243 cleared the Senate Elections Committee 4-1 on Tuesday despite concerns from the committee’s chairperson, Sen. Catherine Blakespear, who criticized the bill as “unworkable” and “problematic.”

“I would argue this bill is not worth moving forward. It has too many problems in it,” said the Encinitas Democrat, the lone “no” vote.

Because the bill would change the voter-approved 1974 Political Reform Act, it needs a two-thirds majority in both the Senate and Assembly to reach Gov. Gavin Newsom.

Dodd and other senators who voted for the bill Tuesday also supported the 2022 law. When asked why he voted in favor two years ago, Dodd told CalMatters: “I don’t think anybody really read into the details.” Prompted by a staffer, he then changed his answer: “I don’t think we understood the implications.”

The 2022 law passed after several local “pay-to-play” scandals. Between 2018 and 2020, the city of Huntington Park awarded more than $11 million to contractors who donated money and gifts to city council members, according to KCET. More than 30% of the $125,000 in campaign contributions were made by just eight companies and their executives.

In January 2023, former Los Angeles city council member Jose Huizar pleaded guilty to extorting $1.5 million from real estate developers seeking city approval for downtown projects between 2013 and 2018, the Los Angeles Times reported. Another former Los Angeles city council member, Mark Ridley-Thomas, was sentenced to 42 months in prison last year for routing county contracts to the University of Southern California in exchange for benefits to his son.

The 2022 law was introduced by Sen. Steve Glazer, an Orinda Democrat. “Public trust is greatly enhanced when decision makers maintain their independence from these corrupting influences,” he said in a statement last year.

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How Does the Law Work?

If you are a builder seeking a city housing permit, under the current law, you and those you hire to lobby the city can only donate a maximum of $250 collectively to a city council member while the project is pending. That restriction will only be lifted 12 months after the final decision is made. If the elected official accepted or solicited money beyond that limit in that 12-month period, they will have 14 days to return the contribution.

If you are a local elected official, before making a decision on the project, you must disclose any contribution made in the past 12 months that was more than $250 and was from the interest groups benefiting from that project. You must also recuse yourself from voting if you’ve accepted such contributions within the 12-month period.

While the law did not spark much debate before it was passed, it led to a lawsuit soon after. In February 2023 — a month after the law took effect — a business coalition including the California Restaurant Association and California Retailers Association and two local officials sued the state’s campaign finance regulator, arguing the law was unconstitutional and violated the freedom of speech rights of officials and donors.

In May, the business groups lost in court. Now, less than a year later, they are turning to state lawmakers instead.

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Dodd’s bill would raise the $250 threshold to $1,000 and effectively allow a contractor seeking a city contract or permit — as well as the contractor’s hired lobbyists — to each contribute as much as $1,000 within the nine months before and after a final decision is made. Across California, 31 of the 180 cities with self-imposed campaign finance rules have donation limits that are $250 or less, according to an analysis by California Common Cause.

“The idea that our local elected officials can be bought and sold for $250 is both laughable and frankly offensive,” Dodd said during Tuesday’s hearing.

The restrictions would not apply to developers working on certain housing projects mandated by the state, or to labor unions if the decisions solely affect their membership dues, according to a bill analysis.

The bill is supported by both business interests and labor unions, such as the California Building Industry Association and the California Labor Federation.

Nick Cammarota, senior vice president and general counsel for the California Building Industry Association, told lawmakers during the committee meeting Tuesday that “pay-to-play” is not happening among homebuilders in California: “If it were, I’ll put it very crassly: We would buy our permits. We’d have more housing.”

Cammarota argued that the current law makes it difficult for local officials and donors to comply with campaign finance rules.

“It creates a vacuum,” he said. “We are concerned that vacuum will be filled by candidates for local office who are wealthy and have the ability to self-finance their own campaigns.”

Dodd agreed, adding that the low contribution cap may encourage donors to use “dark money” groups — often politically active 501(c)(4) organizations that are not required to disclose their contributors — to mount ad campaigns.

But California Common Cause and California Clean Money Campaign — the main supporters of the 2022 law — argued the bill would favor certain industries, reduce transparency and allow local elected officials to accept large donations outside the 18-month period the bill proposed.

“For many lengthy projects that take longer than nine months, these changes would allow for large contributions to be made while a matter is pending” as long as the check is written outside the window, said Pedro Hernandez, legal and policy director of California Common Cause.

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Jonathan Mehta Stein, executive director of the group, called the bill’s advancement a “ special interest triumph.”

“Our democracy is in dire trouble at the national level. The least we can offer Californians is high-integrity, trustworthy governance here at home,” he said in a statement.

Trent Lange, president of the California Clean Money Campaign, argued the proposed rule would be confusing for donors and local officials, since they sometimes cannot foresee when a final decision is coming.

“You are going to read the council’s mind and when exactly they are going to give a final decision?” he said. “How are people even going to follow that?”

In a text message to CalMatters, Glazer said Dodd’s bill “makes it easier to corrupt local officials and it is wrong.”

“We should be working to elevate trust in government and that doesn’t happen when you reestablish ‘pay to play’ terms in jurisdictions across California,” he said. “Those who say the law isn’t working are referring to the financial players who want to corrupt it.”

Blakespear proposed an amendment last week that would have eliminated the proposed carve-outs for housing and membership groups and defined when a decision is “pending,” according to a copy of her amendment shared with CalMatters.

But Dodd refused to budge Tuesday, instead giving a verbal commitment to work through the concerns, including deleting the exemption for housing developers.

“I think there’s a reality to me being a brand new chair and him being in the Legislature for 10 years with relationships with other people on the committee that are long standing and deep,” Blakespear said of the Tuesday vote.

Blakespear said she recognizes the need to balance campaign finance reform and the ability for people to participate in politics through donations. But, she said, “nobody articulated a good reason” for the carve-outs. The interest groups are backing the bill because “they want to be able to donate more money,” she added.

If the current version of the bill becomes law, she predicted that “next year there’s going to be a bill from the cannabis industry, and then there’s going to be a carve-out for some other interest.”

About the Author

Yue Stella Yu covers politics for CalMatters, with a particular focus on campaigns, elections and voters. 

After arriving in California in October 2023, she dove into the state’s once-in-30-years U.S. Senate primary, a fierce contest to replace the late Sen. Dianne Feinstein. Stella helped write CalMatters’ 2024 March primary Voter Guide, dug deep into Senate candidates’ voting records and policy positions, covered three televised debates and examined their pledges against corporate PAC money. She also reported on issues affecting Latino voters’ turnout across California.

Stella will be a lead reporter covering the November election, including the U.S. Senate race, congressional contests and key statewide issues. 

Before joining CalMatters, Stella covered state and local politics in Michigan, Tennessee and Mississippi while dabbing in investigative stories. In 2023, her reporting revealed the highly unregulated housing conditions for Michigan dairy farm workers and the lack of state actions to protect workers. She won first place in investigative reporting in press association contests in Tennessee, Mississippi and Missouri. 

She graduated from the University of Missouri with a master’s degree in journalism from the University of Missouri in 2017. She is based in Sacramento. 

About CalMatters

CalMatters is a nonprofit, nonpartisan newsroom committed to explaining California policy and politics.

The post California Passed a Law to Stop ‘Pay to Play’ in Local Politics. After Two Years, Legislators Want to Gut It appeared first on GV Wire.

Ben Christopher
CalMatters

Under the new policy, utilities will be required to reduce the price households pay for the electricity they use every time they charge a phone or run an air conditioner. That rate cut will vary from 8% to 18%, depending on the utility, season, and time of day, according to the commission’s analysis.

To make up for the lost revenue, regulators have introduced the concept of a “fixed charge,” a break from California electric billing tradition. For decades electric bills from Pacific Gas & Electric, Southern California Edison and San Diego Gas & Electric have been the “pay as you go” variety, with households only paying for the electricity they use.

Starting in late 2025 for SCE and SDG&E customers and in early 2026 for those with PG&E, the state’s investor-owned utilities will be able to charge customers a monthly fee regardless of how much power the customer draws from the grid. So-called fixed charges are a mainstay of electric billing across most of the country, with an average fee of roughly $11.

The new California charge will be $24 for most customers, but lower-income households that already qualify for discounted electric rates will see fees of either $6 or $12.

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Winners and Losers from a Fixed Charge

For households that do not benefit from discounts, lower energy users will pay more every month.

The unanimous vote by the California Public Utilities Commission comes after months of heated debate that pitted Assembly and Senate Democrats and Republicans against legislative leadership and the governor’s office, advocates of rooftop solar against labor unions representing utility workers, and environmental advocates against one another.

Backers of the billing change say it’s a necessary step to bring down electricity rates in California, which are among the highest in the country. California regulators want all new cars sold by 2035 to be electric and are taking steps to discourage gas-powered indoor appliances. Those goals are hard to square with sky-high electric prices.

The state’s planned “transition to all electric homes, cars and trucks is truly transformative,” said CPUC President Alice Reynolds at Thursday’s hearing. Under the proposed change all customers “will be better off financially if they electrify — whether that’s purchasing an electric vehicle or switching out a gas appliance with an electric one.”

Opponents argue that the change in billing policy won’t move the needle for most households considering dumping their gas-powered cars and appliances, which can cost tens of thousands of dollars, but will instead needlessly discourage energy conservation efforts while punishing rooftop solar customers.

The policy is a departure from 50 years of regulatory precedent in California, which is “if you use more you pay more and that encourages conservation,“ said Loretta Lynch, a former CPUC president and critic of what she sees as a “pro-utility” bias on the current body. Reducing the penalty on high energy use will also have “huge cost consequences down the road” for a grid that already struggles to keep up with summer-time demand, she said.

The ultimate impact of the policy change may be more muted than either side wants to admit, said Merideth Fowlie, a UC Berkeley economist and one of a handful of researchers to initially float the idea in 2021 of an income-graduated fixed charge as one way to pay for reduced electricity rates.

The three-tiered CPUC-approved change doesn’t vary much by income and its promised rate reductions are relatively modest, said Fowlie.

“Clearly, I’m disappointed, because I don’t think it comes close to where I think we should be in terms of reductions,” she said. “If this forces another conversation — which is, ‘Why are we paying for wildfire risk mitigation, which is essentially climate change adaptation, or some of these major investments in decarbonisation, on bills?’ — I think that’s an important conversation to have.”

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Winner and Losers in New California Utility Fee

Though utilities won’t earn any more revenue or profit as a direct result of the change, there will be winners and losers under the new billing program.

The reduced price of electricity will likely save money for people who use a lot of electricity, such as a large household in an AC-dependent part of the state or the owner of an electric SUV, a heat pump, and an induction stove. That reduction will be more than enough to offset the cost of the new fee. Many, if not most, low-income households who qualify for the discounted fixed charge will also emerge as financial winners.

But there are sure to be plenty of losers, too. Smaller households, Californians living along the temperate coast, energy-conscious customers, and people with solar panels on their rooftops are all more likely to see their total utility bills rise.

That group makes for a powerful political bloc that has fiercely rallied against the regulatory change for months. Many showed up or called in at the commission hearing.

“The big utility tax will increase monthly utility bills on 4 million households while doing nothing to encourage electrification,” said Yvette DeCarlo, speaking on behalf of a coalition of environmental nonprofits, tenant rights groups, liberal advocacy organizations, and anti-tax activists.

Severin Borenstein, another Berkeley economist who co-authored the 2021 study with Fowlie, said modeling suggests that the lower electricity rates under the policy will increase electric vehicle purchases only by roughly 5% above what they would otherwise be.

“It’s in the right direction, though, and I think that we can’t get to where we need to go unless we start,” he said.

The fixed charge policy was included in a budget proposal by Gov. Gavin Newsom’s administration in 2022, but it wasn’t until last year that many state legislators woke up to it. Twenty-one coastal Democrats, led by Thousand Oaks Assemblymember Jacqui Irwin, introduced a bill ordering the CPUC to reverse course. So too did Senate Republican leader Brian Jones. Both efforts were quietly put on ice at the behest of legislative leadership.

In a letter Jones and the rest of the Senate GOP caucus sent to CPUC president Reynolds earlier this week, the San Diego Republican expressed some skepticism that the state regulatory body could be trusted to keep the fixed charge at its current level.

“We are particularly concerned that this will only be the beginning,” the letter said. “The CPUC has been granted unchecked power to increase this new charge at any time. If the $24.15 plan is approved, the next proposal may see the fixed charge hiked to $50, $100, or even higher!”

Related Story: California Regulators OK Change of How Power Bills Are Calculated

More Shade Directed at the Rooftop Solar Industry

For California’s residential solar industry, the vote is just the latest regulatory broadside.

Over the last two years, the CPUC has slashed the payments that utilities are required to give to single family homeowners, apartment buildings, schools, and businesses that install solar panels.

That’s based on the argument, advanced by the commission, the regulated utilities, and many energy economists, that relatively well-to-do solar customers have been overcompensated in California since the early 2000s, which has had the effect of off-loading the costs of running the grid onto non-solar households.

Advocates for the fixed charge say assigning solar customers an unavoidable monthly charge is yet another way to balance out who pays for major utility line items like wildfire prevention, subsidies for low income households, EV charging networks, and distribution system upkeep.

“What the fixed charge does is ensure that we’re no longer going to have freeloaders,” Scott Wetch, a lobbyist who represents many unionized workers employed by California’s for-profit utility companies, told CalMatters earlier this month.

Outraged homeowners with solar panels were well represented among those who called in to give public comment.

“I have solar panels on the home, which we got right away to cooperate with California’s move to have 100% renewable energy. But yet we’re getting hit with this unfair tax,” Joy Frew, a self-described senior citizen from San Diego County, told the commission over the phone.

“People that really invested in solar trying to do the right thing for the planet — all of a sudden we’re being slapped in the face for doing it,” said a caller named Steve Randall from San Clemente.

Not that every Californian with a solar panel above their head is opposed to the fixed charge. Fowlie, one of architects behind the idea, said her family hopped on the solar bandwagon as a way to bring down their monthly utility bill.

“I’m gonna be the biggest loser under this proposal,” she said, prior to today’s vote. “I would be in that higher income bracket and I have solar, so my bills would go up. But I think it’s a win for California, so I’m a big supporter.”

About the Author

Ben Christopher covers housing policy for CalMatters. Ben has profiled the people who fell through the cracks of California’s rickety COVID rent relief program, demystified the perennial debate between state regulators and local governments opposed to new housing, covered innovative ideas from cities on how to tackle their local housing shortages and explained how complicated legislative proposals about zoning, bonds and corporate ownership of single-family homes affect everyday Californians.

His favorite reporting assignment so far: Touring the various two- and three-story structures that have sprouted up across San Diego under the regulatory guise of “accessory dwelling units” thanks to that city’s one-of-a-kind program. Prior to taking over the housing beat in the spring of 2023, Ben wrote about elections and politics for CalMatters, covering four election cycles, including the 2021 gubernatorial recall campaign. He has been known to craft the occasional politics-themed crossword puzzle.

Ben has a past life as an aspiring beancounter: He has worked as a summer associate at the Congressional Budget Office and has a Master’s in Public Policy from the University of California, Berkeley. He lives in Oakland where he enjoys riding his bike, baking (and then eating) pies, and working on his repertoire of dad jokes.

About CalMatters

CalMatters is a nonprofit, nonpartisan newsroom committed to explaining California policy and politics.

The post Californians Will See Lower Electricity Rates and a New Fee That Won’t Vary with Power Use appeared first on GV Wire.

SACRAMENTO – California Gov. Gavin Newsom will update his budget proposal on Friday, and the news likely won’t be good.

Newsom, in his last term as governor and widely seen as a future presidential candidate, announced a nearly $38 billion deficit in January, driven by declining revenues. Days later, the nonpartisan Legislative Analyst’s Office said the deficit was actually $58 billion when including some reductions in public education spending.

State officials needed a big rebound in tax collections to improve things, but it hasn’t happened. Through the end of April, state tax collections from its three biggest sources — personal income, corporations and sales — dropped more than $6 billion below the previous estimate.

That means the deficit has likely gotten larger, and Newsom will have to propose more ways to fix it. This is the second year in a row California has had a deficit, and so far the state has avoided the most painful cuts to major ongoing programs and services. Instead, Newsom and lawmakers have slashed one-time spending, delayed other spending and borrowed from other accounts.

Related Story: Newsom-Backed Utilities Commission Delays Crucial Solar Vote

Challenges Ahead

A bigger deficit could force tougher choices. In January, Newsom floated the possibility of delaying a minimum wage increase for health care workers that Newsom signed into law to much fanfare just last year.

“We still have a shortfall. We will manage it and we’ll manage it, yes, without general tax increases,” Newsom said on Wednesday during an event held by the California Chamber of Commerce. “We’re not just going to try to solve for this year. I want to solve for next year. I think it’s too important. We have got to be more disciplined.”

State budgeting is a guessing game, particularly in California, where a progressive tax system means the state gets the bulk of its tax collections from rich people. About half of the state’s income tax collections came from just 1% of the population in 2021. This makes the state more vulnerable to swings in the stock market.

If lawmakers and Newsom get revenue projections wrong and the state takes in less than they thought, there’s a shortfall. And unlike the federal government, the California Constitution requires the state to have a balanced budget.

Related Story: Gov. Newsom Appoints Judges for Fresno, Merced Counties

Future Projections

Last year, their predictions were way off after a series of destructive storms in January 2023 prompted lengthy delays in tax filing deadlines. Instead of filing their taxes in April, most Californians could wait until November. Lawmakers still had to pass a budget by June, despite not knowing how much money they had.

This January, Newsom said the state’s revenues for 2022-23 to 2024-25 have been coming in $42.9 billion lower than they estimated.

Newsom and lawmakers have already agreed to about $17 billion in reductions and deferrals to reduce the deficit. Plus, Newsom has said he wants to take $13 billion from the state’s various savings accounts to help balance the budget.

But these won’t close the gap, and California appears headed toward more deficits in the future.

Corporate tax collections are down 15% from last year, the fourth largest drop in the past 40 years, according to the LAO. And while income taxes are growing thanks to a 20% increase in the stock market since October that’s driving an increase of 8% in total income tax collections this year, the LAO said growth is unlikely to continue. That’s because the broader state economy has not improved — the unemployment rate has risen and investments in California businesses have declined.

After Newsom reveals his proposal on Friday, state lawmakers will have until June 15 to pass a balanced budget. The new fiscal year begins July 1.

The post California’s Budget Deficit is Likely Growing, Complicating Gov. Gavin Newsom’s Plans appeared first on GV Wire.

■New measures will install cameras in high crime areas and deploy drones.

■Breed plans to bring 30,000 new residents and students downtown by 2030.

■Challengers criticize Breed’s efforts as anemic and too late.

SAN FRANCISCO — Mayor London Breed on Thursday pledged even more improvements under a pair of controversial public safety proposals voters approved this week that expand police powers and force some welfare recipients into drug treatment, marking a shift from the city’s staunchly progressive policies.

She also made the case in her annual State of the City address that San Francisco is on the upswing, with more homeless tents cleared off sidewalks in recent months and more people arrested for breaking into cars or peddling narcotics. She said property crime is also down dramatically.

Measures to Improve Public Safety

With the measures, she said, they will install cameras in high crime areas, deploy drones for auto break-ins and reduce opioid overdoses.

San Francisco voters on Tuesday approved the two ballot measures she placed on the March 5 primary despite opponents who said the proposals will lead to less accountability for police and more hardship for homeless people.

Breed, a centrist Democrat, is among leaders in politically liberal cities who are turning to tough-on-crime policies considered unthinkable previously, but have grown in popularity amid crime waves. She faces three serious challengers in November who say her administration has failed to deal with vandalism, retail theft and rampant and public drug use.

Reelection Campaign and Propositions

“The reelection campaign kicked off there, I would wager in the same way you’re going to see the same thing tonight,” said Patrick Murphy, faculty director of the urban and public affairs program at the University of San Francisco, referring to President Joe Biden’s State of the Union speech Thursday night.

“She placed a couple of big bets on the ballot, and they came up winners for her,” he said.

Proposition E grants police greater leeway to pursue suspects in vehicles, authorizes the use of drones and surveillance cameras and reduces paperwork requirements, including in use-of-force cases. Proposition F makes drug treatment mandatory for adult welfare recipients if they use illicit substances, or else they can be denied cash assistance.

Murphy, the faculty director, says the measures will not be implemented in time for people to see any difference — but they might prove a boost to Breed if they change perceptions about city conditions in the fall.

Challenges and Future Plans

The pandemic decimated the city’s main economic drivers of tourism and tech. Major retailers closed downtown outlets last year, leaving more empty storefronts in a district that once bustled with tourists and office workers. Businesses complained of vandalism, shoplifting, break-ins and unresponsive police.

Still, there are daunting challenges, including a budget shortfall and a downtown that remains largely deserted as office workers stay home.

To address downtown, Breed said she wants to bring 30,000 new residents and students downtown by 2030 and is soliciting universities and colleges to help. She pledged to veto any legislation from the Board of Supervisors that makes it more difficult to build housing.

And she rejected the idea that San Francisco has lost its progressive values.

“Building homes and adding treatment beds is progressive,” she said to cheers from the audience. “We are a progressive, diverse city living together, celebrating each other: LGBTQ, AAPI, Black, Latino, Palestinian and Jewish.”

Response from Challengers

Her challengers were quick to rip the address with Mark Farrell, a former interim mayor of San Francisco, saying that her efforts were anemic, too little and too late. Philanthropist Daniel Lurie said that Breed has failed to deliver on promises despite years in office.

To her critics, Breed closed with a quote from Theodore Roosevelt prizing the person who strives in spite of setbacks rather than the naysayer who carps from the sidelines. She had a message for them.

“San Francisco is not wearing the shackles of your negativity any longer,” she said.

The post San Francisco Mayor Touts Possibilities After Voters Expand Police Powers, Gets Tough on Drug Users appeared first on GV Wire.

■Rise Above Movement members accused of conspiring to riot.

■Judge dismisses charges against Robert Rundo and Robert Boman.

■Prosecutors plan to appeal the dismissal.

LOS ANGELES — For the second time in five years, federal charges against alleged members of a violent white supremacist group accused of inciting violence at California political rallies were dismissed by a federal judge who found they were selectively prosecuted.

Federal prosecutors said members of the Rise Above Movement conspired to riot by using the internet to coordinate traveling to political rallies and attacking demonstrators at gatherings in Huntington Beach, Berkeley and San Bernardino in 2018. The group also posted videos to celebrate violence and recruit members.

Previous Dismissal of Charges

U.S. District Judge Cormac J. Carney first tossed the charges against Robert Rundo and Robert Boman in June 2019. The two were charged with conspiracy to violate the Anti-Riot Act and rioting.

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On Wednesday, Carney again granted the defendants’ motion to dismiss, agreeing that Rundo and Boman were being selectively prosecuted while “far-left extremist groups” were not.

Judge’s Decision

In his decision, Carney wrote “there seems to be little doubt” that Rundo and Boman, or members of their group, engaged in criminal violence. “But they cannot be selected for prosecution because of their repugnant speech and beliefs over those who committed the same violence with the goal of disrupting political events,” Carney wrote.

Boman was already free on bond, while Rundo was still being detained. Prosecutors requested that Rundo remain in custody pending appeal, but Carney denied it and set him free. Soon after the ruling, prosecutors filed a notice that they would appeal, the Los Angeles Times reported.

Reaction to the Ruling

Outside the courtroom, Boman became emotional and said he was ashamed of his “old antics,” the Times said.

In his 2019 ruling, Carney said the Anti-Riot Act of 1968 was unconstitutional in part because it criminalized advocating violence when no riot or crime was imminent.

The post Charges Against Alleged White Supremacists Are Tossed by a California Judge for the Second Time appeared first on GV Wire.