Harris picks Walz (And X leaves SF)

Presented by America's Fuel: Inside the Golden State political arena

Aug 06, 2024 View in browser   By Lara Korte, Jeremy B. White and Dustin Gardiner Presented by America's Fuel The San Francisco headquarters of the company formerly known as Twitter is seen Monday, July 31, 2023. | Godofredo A. Vásquez/AP DRIVING THE DAY:  Vice President Kamala Harris will name Minnesota Gov. Tim Walz as her running mate, three people familiar with the decision told POLITICO this morning. By choosing Walz, Harris is elevating a Midwestern governor, veteran and former schoolteacher to help shore up support among blue-collar, white voters in the Rust Belt. Walz, 60, led a progressive overhaul of Minnesota during his second term as governor, when Democrats took full control of state government in 2023 — a template for what Democrats hope to do nationally. THE BUZZ: NOT QUITE TEXAS — Elon Musk is taking his talents to the South Bay. Mere weeks after Musk threatened to relocate operations for his social media platform X to the Lone Star State, employees in the company’s flagship San Francisco office learned they would be moving to existing offices in San Jose, according to an internal email first reported by the New York Times. The company will also open an engineering-focused office in Palo Alto, the email said. It’s not even close to the slam against California that Musk had originally telegraphed when, expressing his outrage over a new law to protect the privacy of LGBTQ+ students, he vowed to move the social media platform and SpaceX to Texas. A spokesperson for San Francisco Mayor London Breed didn’t respond to a request for comment. Gov. Gavin Newsom, who has had his own online tussles with Musk recently, responded to the news with the social media equivalent of an eyeroll.  In a statement, Newsom’s office said "We’re pleased to see that they’re opening a new engineering office in Palo Alto, and the transition to San Jose was already underway." Nevertheless, relocating X, formerly Twitter, from its longtime location in downtown SF marks a significant moment for the city that fought so hard to keep it there. It’s particularly acute now as the city struggles to fill office spaces that emptied out during the pandemic. Twitter first took root in San Francisco in 2006, but by 2011, the company, frustrated with the cost of living and doing business, was making plans to relocate to Brisbane. That’s when the SF Board of Supervisors and the late Mayor Ed Lee introduced the idea of a tax break, relieving Twitter and other tech companies in the mid-Market neighborhood of a 1.5 percent payroll tax in hopes of attracting jobs and revitalizing the area. San Francisco at the time was in somewhat dire straits. Unemployment was hovering around 10 percent and city leaders viewed tech as an economic lifeline. Jason Elliott, a veteran of City Hall who was working for then-mayor Lee when he championed the tax break, described the circumstances as “really challenging” when he spoke to POLITICO last fall. “[The tax break] wasn't about, sort of, tech sandboxing so much as it was a critical economic imperative to… bring jobs and keep jobs in the city,” he said. The tax break succeeded in keeping Twitter in San Francisco, and the company moved to its current location at 1355 Market Street. But when the incentive neared its expiration date in 2019, there was little appetite among city officials to keep it. For many critics on the left, the special treatment epitomized SF's overly solicitous stance toward an industry that inflated rents without doing its part for the city. "It didn't work," said Assemblymember Matt Haney, who was a supervisor at the time. "It seemed to work initially just to help Twitter with their decision whether to leave at that moment, but beyond that it didn't do a lot to keep companies or keep them in that area." Haney, who heads the Assembly’s Select Committee on Downtown Recovery, told Playbook that X leaving is certainly not a good thing, and that there's no denying San Francisco's downtown, like many cities, is struggling to bounce back from the pandemic. But the solution doesn’t lie in giving one-off tax breaks to corporations or trying to appease certain tech scions who may not agree with liberal policies, Haney said. He pointed to two city ballot measures coming up in November that could ease the tax burden on companies who want to do business in the city. It’ll take changes to the tax code, along with some basic quality of life improvements, to revitalize the city, he said. "San Francisco needs to be cleaner and safer, with better infrastructure and more housing," Haney said. "All of these things go together."   A message from America's Fuel: 87% of Californians are concerned about gas prices. E15 could be the answer—but only if America's fastest-growing biofuel blend gets approved in the Golden State. See how giving drivers the freedom to fuel up with E15 can boost savings and lower emissions. Learn more.   GOOD MORNING. Happy Tuesday. Thanks for waking up with Playbook. You can text us at ‪916-562-0685‬‪ — save it as “CA Playbook” in your contacts. Or drop us a line at lkorte@politico.com and dgardiner@politico.com, or on X — @DustinGardiner and @Lara_Korte. WHERE’S GAVIN? Nothing official announced. STATE CAPITOL California Assemblymember Buffy Wicks, a Democrat and chair of the Assembly Appropriations Committee, speaks to reporters on May 16, 2024, in Sacramento, California. | Adam Beam/AP JOURNALISM BILL TALKS ONGOING — Negotiations over the California Journalism Preservation Act are ongoing this week as Assemblymember Buffy Wicks continues her push to make online giants pay news outlets for profiting off their stories, a spokesperson for her office told Playbook. Before the summer recess, Wicks called her proposal a “work in progress” and pledged to continue searching for a “sweet spot” with tech companies like Google and Meta, which oppose the legislation. As it’s currently written, the bill leaves room for tech giants to negotiate the amount of money they’d be required to pay annually into a fund supporting California’s journalism industry. That amount could top nine figures, based on a similar $100 million agreement — about $72 million in U.S. dollars — made between Google and Canadian officials last year. But tech companies are still sour on Wicks’ idea, at least publicly. In a digital ad campaign launched last month, Google argued the bill would “reduce your access to trusted, reliable information online.” Another ad from the Computer and Communications Industry Association claimed the bill would subsidize “big, out-of-state media companies and hedge funds,” amplifying criticisms shared by tech lobbyists. Wicks has spent months ironing out amendments that give extra flexibility and compensation options to California’s smallest newsrooms, some of which fear the bill could further exacerbate their disadvantages against bigger outlets. — Tyler Katzenberger   During unprecedented times, POLITICO Pro Analysis gives you the insights you need to focus your policy strategy. Live briefings, policy trackers, and and people intelligence secures your seat at the table. Learn more.     FEDS GO FIRST — An effort to regulate xylazine, or “tranq,” a deadly street drug often mixed with fentanyl, has hit a snag in the Legislature despite being backed by Newsom. Bills by Assemblymember Jasmeet Bains and Senator Angelique Ashby that would schedule the drug on the list of controlled substances ran into the objections of Assembly Public Safety Committee Chair Kevin McCarty, who wants the federal government to go first in regulating tranq. McCarty, who declined comment, held Ashby’s bill in committee last month after she refused to take the amendment. Bains, whose proposal goes further than Ashby’s in allowing the state to test for “emerging substances” other than xylazine, accepted the amendment. Her bill awaits a hearing in the Senate Appropriations Committee. Newsom did not mince words for McCarty after Ashby’s bill was held, calling it “a huge mistake that a member of the Legislature killed the tranq bill.” Neither did Ashby, who said McCarty was playing “member politics,” telling her that he wanted to be fair to Bains in making Ashby take the same amendment. She also accused McCarty of using “aggressive” tactics to stall the bill, such as not allowing a vote when the measure came up in his committee. “If one member who's the public safety chair decides that we're not going to be leaders in California, and instead we're going to follow the federal government — that has historically acted decades behind us on drug policy — then then that's where 40 million Californians sit, waiting for Kevin McCarty to make a better decision on our behalf,” Ashby told Playbook. — Eric He.   A message from America's Fuel:   SPOTTED: In the Assembly chambers — Lawmakers returned from summer recess to find tall plexiglass panels lining the gallery. A spokesperson for Assembly Rules Committee said the glass is very similar to the apparatus installed in the Senate gallery following an incident involving a protester several years ago, and addresses “key safety issues to protect our visitors, Members, and individuals working on the chamber floors.” The spokesperson said the total budget for the project was $420,000, which included design, engineering, and also fabrication and installation performed by local California suppliers and installers. The body has witnessed several demonstrations in support of Palestinians this year. Last month, on the last day of session, Assemblymembers shouted over chants from the gallery as they finished their business. ON THE AGENDA IN THE ASSEMBLY — The Budget committee is meeting to talk about the state of California’s reserves. IN THE SENATE — The Energy, Utilities and Communications committee is meeting to get an update on grid reliability as the state transitions away from carbon. SACRAMENTO ELITE — Capitol Weekly will unveil its annual Top 100 list tonight of the biggest movers and shakers in California politics. Read last year’s list here.   SUBSCRIBE TO GLOBAL PLAYBOOK: Don’t miss out on POLITICO’s Global Playbook, our newsletter taking you inside pivotal discussions at the most influential gatherings in the world. Suzanne Lynch delivers the world's elite and influential moments directly to you. Stay in the global loop. SUBSCRIBE NOW.     CLIMATE AND ENERGY SETTING THE TABLE — Lawmakers and Newsom are gearing up to try to hash out deals this month on electricity bills, corporate emissions reporting, hydrogen, wildfire-friendly development and more. Check out California Climate's guide to the end of session. Top Talkers PELOSI ON BIDEN: House Speaker Emerita Nancy Pelosi told ABC News yesterday she didn’t want President Joe Biden to step down; she just wanted “a campaign that would win,” POLITICO’s Irie Senter reports. Pelosi said she “wasn’t seeing” a winning campaign on the horizon. GOOGLE LAWSUIT: A federal judge on Monday ruled Google illegally monopolized the online search and advertising markets over the past decade, POLITICO’s Josh Sisco reports — a sweeping victory for the Justice Department and several dozen state attorneys general, including California. Monday’s ruling only determined whether Google broke the law. A separate trial will determine how to remedy the issue. ‘SPACE AFICIONADO’: Kamala Harris is aiming for a moonshot presidency amid an emerging space race with China, POLITICO’s Joshua Posaner and Matt Berg report. Harris has been heavily involved in space policy as chair of the U.S. National Space Council under Biden, and she could oversee an Artemis mission that sends humans back to the moon later this decade if she defeats Donald Trump in November. The Artemis initiative was launched under Trump. — complied by Tyler Katzenberger AROUND THE STATE — California’s summer COVID surge has been more intense and long-lasting than experts previously expected, and it hasn’t plateaued yet. (Los Angeles Times) — Petaluma rolled out the nation’s first citywide reusable cup program Monday, which replaces single-use cups with insulated to-go tumblers that can be returned at drop-off bins located throughout the city. (San Francisco Chronicle) — The Oakland Athletics have tentatively agreed to sell their Coliseum ownership stake to the African American Sports and Entertainment Group, a local Black-owned sports and entertainment company that plans to redevelop the site. (KQED) — An audit of Capital Public Radio conducted by Sacramento State University found the radio station made hundreds of thousands of dollars in unsupported payments and uncovered additional details of potential conflicts of interest. (Sacramento Bee) — compiled by Tyler Katzenberger   A message from America's Fuel: California can save big by unlocking access to E15 fuel made with 15% biofuel. If approved, E15 can save drivers more than 20 cents per gallon, delivering millions in annual savings across the state and much-needed relief at the pump. Forty-nine states are in the fast lane to lower gas prices with E15. Will California be next? Learn how E15 can put California on the road to bigger savings and a greener, cleaner future.   PLAYBOOKERS PEOPLE MOVES — Veteran Los Angeles communications and political strategist Jeremy Oberstein has opened his own shop: 10th Street Communications. He previously led comms for City Controller Ron Galperin, Councilmember Paul Krekorian and was senior VP for Strategies360 before leaving the company last week. He takes with him a major client: former mayor and current candidate for governor Antonio Villaraigosa.  — Josh Koehn, previously a senior reporter at SF Standard, has joined The Information, where he’ll be reporting on powerful people in San Francisco tech with an emphasis on politics and public policy. — Daniel Villaseñor is now the deputy communications director for the governor. — Kellie Smith, former chief consultant of both the Senate Energy and Assembly Utilities committees, announced she has “failed at retirement” and has moved on to the consulting world. BIRTHDAYS — Federal Trade Commissioner Becca Kelly Slaughter … Lindsay Bednar … Nitzan Pelman … Jenny Mayfield …  BELATED B-DAY WISHES — (was Monday): Lila Cohn  WANT A SHOUT-OUT FEATURED? — Send us a birthday, career move or another special occasion to include in POLITICO’s California Playbook. You can now submit a shout-out using this Google form. CALIFORNIA POLICY IS ALWAYS CHANGING: Know your next move. From Sacramento to Silicon Valley, POLITICO California Pro provides policy professionals with the in-depth reporting and tools they need to get ahead of policy trends and political developments shaping the Golden State. To learn more about the exclusive insight and analysis this subscriber-only service offers, click here. Want to make an impact? POLITICO California has a variety of solutions available for partners looking to reach and activate the most influential people in the Golden State. Have a petition you want signed? A cause you’re promoting? Seeking to increase brand awareness amongst this key audience? Share your message with our influential readers to foster engagement and drive action. Contact Rebecca Haase to find out how: rhaase@politico.com.   Follow us on Twitter Dustin Gardiner @dustingardiner Lara Korte @lara_korte   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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