The Brief

In one of its most controversial decisions, California’s air board voted tonight to revamp a key climate change program, which could increase gas prices in a state already facing some of the nation’s steepest costs at the pump.

The California Air Resources Board approved major changes to its Low Carbon Fuel Standard, a program aimed at encouraging use of cleaner transportation fuels with financial incentives as the state moves toward phasing out gasoline and diesel.

The board’s 12-2 vote tonight followed about seven hours of comments from more than 100 people and four hours of discussion by board members at its meeting, held in Riverside.

State Assemblymember Tom Lackey, a Republican from Palmdale, told the board during public comments that the possible impact on gas prices will harm working class Californians.

“We’re the hard working men and women here in the state of California. We build homes, we fix roads, and we serve you when you dine out,” Lackey said. “To do this, we must drive hours each day to work to put food on the table for our families. This measure before you will cause us financial pain.”

At the heart of the controversy is the question: How do you wean Californians off gasoline and diesel — which is critical for cleaning the state’s dirty air and reducing its role in the climate crisis — without substantially raising the cost to consumers?

Many air board members referred to an urgency to push for cleaner fuels in California because of the outcome of the Tuesday election, which gave Donald Trump, who has denied the existence of climate change and targeted California environmental programs, the presidency and Republicans control of the U.S. Senate.

The new rule’s potential effects on California fuel prices are largely unknown. The air board said today that oil companies typically already pass 8 to 10 cents per gallon of costs on to consumers because of the state’s fuel standard.

The board also passed a resolution tonight requiring an annual review of the rule’s impact on gas prices. If the changes “ultimately accelerate cost burdens on California consumers,” the board said in the resolution that it will consider amending them.

Eric Guerra, a Sacramento city council member who was appointed to the air board by Gov. Gavin Newsom, said the air board must prioritize public health but that support of working families is equally important, so he called for frequent monitoring of the possible impact on gas prices.

Concerns about gas prices have fueled the debate surrounding the board’s proposal since its release last December. But much of the agency’s revamp of its fuel rules focuses on intricate disputes among environmentalists, oil companies, dairy farms that use manure to produce fuels, biofuel companies and other low-carbon fuel providers.

Environmentalists and consumer advocates opposed the new rules, warning the changes will boost alternative fuels — such as biofuels made from cow manure or soy beans — that may have limited environmental upsides, and will allow oil companies to stay in business because they can buy credits or switch to producing those fuels.

“It is not based on science, and it will undermine environmental justice and the rapid transition to zero emissions that we need more than ever today,” Nina Robertson, a senior attorney with Earth Justice told the board. “It represents a grab bag of giveaways to polluting special interests that have turned what once was a program for climate progress into a piggy bank for their false climate solutions.”

Electric car advocates and a variety of biofuel company representatives supported the new rules, saying they will provide billions of dollars in funds and incentives to move California toward eliminating carbon that warms the planet.

Tonight’s vote was the culmination of a debate over changes in a fuel standard that has roiled the air board for longer than a year, becoming a political flashpoint in recent weeks.

The program, which has existed since 2011, is a $2-billion credit trading system that requires fuels sold in California to become progressively cleaner, while giving companies financial incentives to produce less-polluting fuels, such as biofuels made from soybeans or cow manure.

The amendments approved today will require gasoline, diesel and other fuels in California to meet stricter standards for greenhouse gases while changing how credits are awarded for specific lower-carbon fuels.

Air board Chair Liane Randolph told CalMatters in an interview last month that the low-carbon fuels program is “one of California’s most significant and most effective climate programs.”

At the meeting today, Randolph suggested the new rules are critical, given how California’s climate and air pollution programs could come under strain from the new Trump administration.

“We know that in order to be successful in addressing climate change, we must continue to reduce our fossil fuel consumption and invest in low-carbon energy,” said Randolph, who was appointed to the board by Newsom. “Let’s be realistic, the tools in our (climate) toolbox may become much more limited going forward.”

But the debate resulted in two rare public defections among the 14 voting members of the Air Resources Board, who often unanimously approve major rules for cleaning up air pollution and cutting greenhouse gases.

Air board members Dean Florez, a former state senator from the Central Valley, and Diane Takvorian, an environmental justice advocate, voted no.

“Obviously, I’m a no, mostly about the environmental issues that were brought up, but also this whole discussion about gas,” Florez said.

Takvorian criticized how large dairy farms, which often pollute low-income farm communities, will benefit from the state’s low-carbon fuel credits for their manure digesters for 30 years.

Florez said he is concerned that oil companies support the program and “that should give the board a little bit of pause.” Their products are a main cause of climate change.

“I listened to the testimony today, and I’ve been watching most of the industry tweets, and they all seem very giddy about the current program … that kind of worries me, because they kind of get to play both sides in some sense,” he said.

Florez warned in a CalMatters opinion piece earlier this week that the program is flawed, that it could impose financial hardships on people, and that the air board was not transparent about the costs.

“Such increases would affect essential goods and services, as transportation costs ripple through the economy, impacting food prices, housing affordability and more. For Californians already stretched thin by escalating rents and inflation, these additional costs could become overwhelming, pushing many into deeper financial insecurity,” wrote Florez, who is the state Senate-appointed member of the air board. His current term ends next month.

Air board member Hector De La Torre said oil companies are dishonest when they blame rising gas prices on the climate program. He said it was “a false narrative period” and blamed oil companies for price fluctuations.

“We’re not wildly fluctuating … we project out for many years. We let them know what we’re going to do, we let them know how it’s going to play out,” said De La Torre, a former Assembly member who was appointed to the board by the state Assembly. “So let us be clear about why we have the wild fluctuations in California on gas prices. It is not us. It is not the Legislature.”

Florez, however, disagreed. “How we can, in all good conscience, say that it’s all these other factors and somehow we’re not a cause.”

A gas price fight

Energy experts and air board staff say the fuel standard raises the cost of producing high-polluting gasoline and diesel for the California market because oil companies must buy credits from lower-carbon fuel producers, or produce the fuels themselves.

Those costs can drive up prices at the pump when companies pass them on to customers, although it’s difficult to predict by how much. Some companies might produce cleaner fuels themselves, potentially profiting from the incentives, while others may buy credits on the market.

In an initial assessment released last year, the air board projected that the proposed new standard could potentially raise the per-gallon price of diesel by 59 cents and for gasoline, 47 cents, in 2025. Air board officials have since disavowed that estimate, writing last month that the analysis “should not be misconstrued as a prediction of the future credit price nor as a direct impact on prices at the pump.”

A separate report, released last month by the University of Pennsylvania’s Kleinman Center for Energy Policy, predicted that the program’s changes could increase the cost of gas by 85 cents a gallon through 2030.

The fight over the fuels standard has shown how the state’s ambitious agenda for addressing climate change can be the subject of ire if it threatens to make fossil fuels more expensive. Californians paid an average of $4.52 a gallon today, second only to Hawaiians.

The vote came three days after a presidential election marked by concerns over inflation. State Republicans, in particular, have slammed the program as misguided, saying it piles on costs at a time when affordability is a top concern.

An analysis by California’s nonpartisan legislative analyst found the average California household spent about $3,200 a year on gasoline in 2021 and 2022, but some families — typically those with below-average incomes — spent more, about $6,150 a year.

“If gas prices would have been (10 cents per gallon) higher during the period we reviewed, the typical household’s gasoline spending would have increased by about $60 per year” and $130 per year for the households most reliant on gasoline, the Legislative Analyst’s Office wrote.

Raising the cost of diesel could have sweeping effects on the economy, since it fuels trucks and trains that carry goods, from food to toys, that Californians rely on and buy.

Tim Taylor, chief legislative advocate for the National Federation of Independent Business, said the state’s small business owners are concerned about that ripple effect on the economy.

“We’re not opposed to the greenhouse gas emission goals of the state, but the choice today is not one of endorsing zero emissions…it’s one of subsidizing biofuels,” Taylor said.

Small businesses worry about “the potentially massive gasoline price hikes, and the adverse impacts those increases will have on their businesses, and the rippling effect it will have on all Californians without actually improving the air quality of the state,” he said.

The Western States Petroleum Association, an oil industry group, has supported the program, with many of its members producing some of the new fuels the program has spurred. However, they argued against many proposed changes because they might increase costs or disadvantage some companies. Chevron also warned against what the changes might do to costs in the state.

“At a time when fuel prices are under significant scrutiny and demand in California frequently outstrips supply, regulators should be careful about adding new measures that restrict supply,” Don Gilstrap, Chevron’s manager of fuels regulations wrote to the board last month.

Millions of tons of carbon eliminated

Under the California Climate Crisis Act, the state must slash its greenhouse gases to reach net-zero greenhouse gases by 2045. Cars, trucks and other transportation are the number one source and the changes to the fuels standard are meant to prevent California from falling behind on its ambitious climate goals, which are already at risk.

The standard has helped the state clean up air pollution and cut climate-warming gases, according to the air board. Through 2022, the program has eliminated 140 million metric tons of carbon dioxide. The air board’s changes are expected to reduce carbon dioxide-equivalent gases by 558 million metric tons through 2046, according to its initial economic assessment.

Those predicted reductions are equal to what more than 120 million cars emit on average in a year, though experts have told CalMatters the board’s estimates could be overstatements because the carbon footprint from some renewable diesel might be more than reported.

The program has been particularly successful in shifting the fuel market for medium and heavy-duty trucks, and over the course of 13 years, the program has displaced 25 billion gallons of petroleum fuels, according to the board’s economic assessment.

The previous standard’s target was reducing the climate impact of transportation fuels by 20% between 2010 and 2030. The changes impose tougher “carbon intensity” targets, tightening the greenhouse gas reductions by about 30% by 2030 and 90% by 2045.

Through the state’s fuel standard, California has become a proving ground for cleaner fuels. But so many companies are producing them now that the value of credits has nosedived, dropping to an average of $68.12 last week compared to a weekly high in February 2020 of $211.02. The credits have built up to the point where some companies can buy their way out of producing cleaner fuels. To avoid that, regulators tightened the standard so that companies have incentives to burn through their excess credits.

Laura Renger, chair of the California Electric Transportation Coalition, emphasized the low-carbon fuel program’s importance in advancing the state’s electric car market. “It will bring critical funding,” she said. Electrify America and several car manufacturers also voiced their support.

“We have estimated that between now and 2035, the utilities would get about $4.8 billion” from the program to invest in electrification of cars and zero-emission trucks and buses, much of it in low-income communities, air board deputy executive officer Rajinder Sahota.

Biofuels: Are they better?

The fuel standard has notably driven a surge in biofuel production, derived from plant and animal waste. In the Bay Area, two companies are shifting their refineries to biofuels: a joint venture between Marathon and Neste is repurposing the Marathon Martinez refinery, while Phillips 66 is converting its Rodeo refinery into a biofuels-focused facility.

Bobby Thomas, general manager of the Rodeo refinery, told the board today that the program has helped “embrace and promote the production of lower carbon fuels in California.”

However, some experts are skeptical about the benefits. The University of Pennsylvania report estimates that about 80% of the credits issued to date — worth more than $17.7 billion, have gone to biofuels. While the air board says biofuels reduce emissions compared to traditional fossil fuels, experts say the results are mixed.

Renewable diesel fuels, like ones made from soybeans, also have unintended environmental consequences, including deforestation and food system disruptions. The board imposed limits on diesel produced from soybean oil, canola oil and sunflower oil, but some say the changes don’t go far enough.

“A dynamic that has simply not gotten the attention that it deserves is what it means, ethically and morally, that California is celebrating making fuel from food,” said Gary Hughes, Americas Program Coordinator for the group Biofuelwatch. “This is a trend that’s particularly disturbing with all the evidence about how these products are not a climate solution.”

The board directed the staff to convene a forum in a year to collect the latest science on the effects of biofuels and find ways to avoid any harm on resources and food supply that they may cause.

Another debate over new biofuels has sparked tension around their effects on California’s low-income, polluted communities of color. The flashpoint is the phaseout of climate credits for dairy farms’ cow poop.

California’s strategy has leaned heavily on dairy industry incentives, offering grants for digesters — systems that trap methane from manure — and valuable fuel standard credits for the resulting natural gas. With dairy and livestock responsible for nearly half of the state’s methane emissions, capturing these gases not only keeps them out of the atmosphere but also turns waste into renewable fuel.

The changes will phase out these dairy credits, starting in 30 years for existing projects and in 20 years for those built before 2030. Environmental groups wanted a faster discontinuation, arguing that the credits prop up industrial dairy farms that pollute low-income, rural communities in the Central Valley.

In response, the air board directed the staff to prepare a plan to regular methane emissions from dairy farms and other livestock.

The Olympic and Paralympic Games will cost billions of dollars to put on, and lucrative contracts will be up for grabs to provide things like cleaning services, construction, catering, and IT services for the month-long spectacle.

L.A. public officials want that money to stay local, but many of them say a new procurement plan released by Olympic organizing committee LA28 could end up leaving out businesses in the city of Los Angeles.

"You could have a scenario where no L.A. business does any business with LA28," Council President Marqueece Harris-Dawson said at a council committee meeting Tuesday.

That's a problem for the city, which is the official Olympic host and the financial backstop for the Games. City Council members say business owners in the city should benefit the most from the money flowing into the Games. The Olympic contracts are worth up to $4 billion in total, according to LA28.

The dispute is yet another sign that the relationship between city government and the private organizers of the 2028 Olympics is fraying. In recent months, the two sides have clashed over an overdue agreement about what services the city will provide for the Olympic Games, and the city's potential financial exposure.

LA28's plans for Olympic contracts raises the perennial question about the coming Olympic Games: who in the city will actually benefit from the mega-event that will take over the region in the summer of 2028. It also indicates the limits of the city's ability to influence LA28's decision-making.

John Reamer, who leads the city's contracts department, said Tuesday that his staff did not review the procurement plan before it was released, and questioned if the relationship between the city and LA28 was a true "partnership."

"[I believed] that LA28 would allow us to give input, and they would take that input, and we would discuss that input and we would agree upon that input and it would be part of the plan," he said.

City officials want more commitments for L.A. businesses

LA28 says it's aiming to keep 75% of its spending in the Greater L.A. area, and put 25% towards small businesses. The report says it will prioritize "hyperlocal" businesses in the city of L.A., but makes no explicit promises. Instead, it identifies "local" as anywhere in L.A., Orange, Riverside, San Bernardino and Ventura counties.

At a council committee meeting on the Olympics Tuesday, multiple members criticized that plan as too broad — pushing LA28 to instead make guarantees to businesses in the city of L.A.

" Los Angeles stands alone in terms of its commitment, its investment and the amount of risk that we're bearing," Harris-Dawson told LAist. "We think every possible avenue ought to be pursued to make sure you leave the people whole, if not better, off, than they were before this started."

LA28 CEO Reynold Hoover told the council Tuesday that LA28 would give L.A. city businesses preferential treatment when awarding contracts.

"When all else is equal between two competing suppliers, we will prioritize City of L.A. suppliers," he said.

Hoover said that focusing exclusively on businesses in the city of L.A. would limit competition for those contracts — and that he wouldn't commit to a plan that would limit LA28's ability to secure the best contract that would be financially responsible.

"If I focus solely, first and foremost, on the city of L.A. for small business, then I am artificially reducing the pool of competition, placing greater risk on the city taxpayers and placing greater risk on the backstop of the city of L.A.," Hoover said.

Council president Harris-Dawson pushed back.

"We'd rather you pay nominally more to a business in the city, than to save $25," Harris-Dawson said. "If you just go for a straight, 'We want the cheapest person in the five-county area,' I can tell you already, you're going to be using a bunch of businesses where the land is cheap and there's no regulation."

Councilmember Hugo Soto-Martinez echoed those concerns, saying that the minimum wage and cost of living in L.A. are higher — meaning that businesses in Los Angeles may charge more.

"The city of L.A. is the financial back-stop to everything that you are doing. And I don't think that has resonated or permeated through you or this whole board that I just frankly don't trust" he said. "We have to go to our constituents and say that we are fighting for them to make sure that they're going to get as much business as they can out of this event."

Millions on the line for the city

The dispute over opportunities for local businesses represents one of many areas where the city and LA28 are at odds.

An important agreement that will dictate which services the city of Los Angeles will provide and how it will be reimbursed is more than six months late. Last week, city councilmember Monica Rodriguez penned a public letter warning Hoover that the Olympics could "bankrupt" the city if that agreement doesn't include adequate protections for the city.

The major concern is who will pay security costs for the Olympics, including LAPD overtime.

The federal government has allocated one billion dollars to security costs for the mega-event, and has put the Secret Service in charge of security planning. Despite those plans, city officials are concerned about who will be left with the bag if the federal funding doesn't come through, or if it doesn't cover all of the city's security costs.

Rodriguez warned that if it isn't changed, the current draft agreement could leave L.A. vulnerable to spending hundreds of millions even if LA28 turns a profit.

Expensive ticket prices are also a sore spot for the city council. Olympics tickets cost up to $5,500 and the cheap $28 tickets went fast in the locals-only pre-sale. Every ticket included a 24% service fee.

Councilmember Katy Yaroslavsky asked Tuesday how much of the service fee would be going to LA28 — a figure that Hoover said he didn't know.

"The tickets are not affordable," she said. "A dollar, which would have actually helped us do some of the things that we know we need to do to get ourselves ready as a city for the Olympics, feels like a drop in the bucket compared to a 24% surcharge."

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A key tool of the U.S. spy community will expire this month without action from Congress. The government says the intel gathered through the provision — Section 702 of the Foreign Intelligence Surveillance Act, or FISA 702 — underpins a majority of the articles in the president's daily intelligence briefing and is a key asset in international counterterrorism and the fight against trafficking.

But a number of lawmakers, both Republicans and Democrats, are concerned that FISA 702 allows for the federal government to spy on the communications of American citizens without a warrant, violating their constitutional right to privacy.

The looming fight to bolster the law's civil liberties protections is likely to be bruising — and the provision's advocates claim it could jeopardize national security.

What is Section 702 of the Foreign Intelligence Surveillance Act?

Section 702 of FISA empowers U.S. intelligence agencies to collect and review the electronic communications of foreign nationals located outside the United States without obtaining individual court orders.

Sometimes, foreign nationals communicate with people in the United States, leading to incidental collection of Americans' communications.

The Office of the Director of National Intelligence says the government uses the information collected through the program to protect the U.S. and its allies from foreign adversaries — including terrorists and spies — as well as to inform cybersecurity efforts.

"No one denies the immense intelligence value of Section 702," Stewart Baker, former National Security Agency general counsel, told Congress in January.

"The U.S. government recently credited the program with helping to disrupt several terrorist attacks here and abroad, identify the Chinese origins of imported fentanyl precursors, respond to ransomware attacks on U.S. companies, identify Chinese hackers' intrusions into a network used by a key U.S. transportation hub, and disrupt foreign government efforts to carry out kidnappings, assassinations, and espionage on U.S. soil. Those examples just scratch the surface," Baker said.

Why is Congress debating this now?

The program's 2024 authorization is set to expire on April 20 — unless Congress votes to renew it. Congress has always attached an expiration date to Section 702, which makes its renewal a recurring fight on Capitol Hill.

Civil liberties-minded legislators of both parties have long been concerned that Section 702 enables illegal, warrantless surveillance of American citizens by the federal government. And unlike most issues in contemporary politics, the issue doesn't break cleanly along party lines.

Prominent critics include Sen. Mike Lee, R-Utah, Sen. Ron Wyden, D-Ore., and Rep. Warren Davidson, R-Ohio.

But, with a change in administration since the last renewal battle, some lawmakers have switched sides.

Rep. Darrell Issa, R-Calif., who previously voted against the renewal because of its lack of a warrant requirement to query information about Americans, told The Hill he thought reforms to the program were working.

Rep. Jamie Raskin, D-Md., is working to rally his colleagues against a renewal — after voting for it in 2024.

President Trump supports an extension with no changes to the program.

"When used properly, FISA is an effective tool to keep Americans safe. For these reasons, I have called for a clean 18-month extension," Trump wrote in a March post on Truth Social. "With the ongoing successful Military activities against the Terrorist Iranian Regime, it is more important than ever that we remain vigilant, PROTECT our Homeland, Troops, and Diplomats stationed abroad, and maintain our ability to quickly stop bad actors seeking to cause harm to our People and our Country."

That position is a major shift for Trump, who railed against the program in the past. Ahead of the last renewal vote in April 2024, during the Biden administration, Trump posted "KILL FISA, IT WAS ILLEGALLY USED AGAINST ME, AND MANY OTHERS."

How is the information actually collected?

A special court, the Foreign Intelligence Surveillance Court (FISC), issues a blanket authorization each year that allows the government to collect information about any targets who fall within certain categories proposed by the attorney general and director of national intelligence.

The National Security Agency, National Counterterrorism Center, Central Intelligence Agency and FBI obtain that information directly from the U.S. companies that facilitate electronic communication such as email, social media or cellphone service.

The National Security Agency also collects communications "as they cross the backbone of the internet with the compelled assistance of companies that maintain those networks."

What role does Section 702 play in the landscape of American intelligence gathering?

A massive amount of information is collected under Section 702 authority: There were 349,823 surveillance targets in 2025, up from about 246,000 in 2022. Targets could each have many records collected — think about the number of emails that hit your inbox each day — leading to a giant database of information.

In 2023, 60% of the president's daily brief items — a daily summary of pressing national security issues prepared for the most senior administration officials — contained Section 702 information, according to a government release.

It is also used extensively to combat weapons and drug trafficking — 70% of the CIA's illicit synthetic drug disruptions in 2023 stemmed from FISA 702 data, the document said.

Can the government search for Americans' information inside the trove of information it has collected under Section 702?

Yes, under certain parameters that have been gradually narrowed over the nearly two-decade lifespan of the legislation.

Here are some of the reasons the government says it might search for Americans, as included in a public report from the Office of the Director of National Intelligence (ODNI):

• "Using the name of a U.S. person hostage to cull through communications of the terrorist network that kidnapped her to pinpoint her location and condition;
• Using the email address of a U.S. victim of a cyber-attack to quickly identify the scope of malicious cyber activities and to warn the U.S. person of the actual or pending intrusion;
• Using the name of a government employee that has been approached by foreign spies to detect foreign espionage networks and identify other potential victims; and
• Using the name of a government official who will be traveling to identify any threats to the official by terrorists or other foreign adversaries."

Does the government need specific permission from a court to search for an American's information?

No, the government does not need — and has resisted reforms that would require — a targeted court order to search for an American's information in corpus of material gathered under Section 702 authority.

Intelligence community and FBI advocates argue that a requirement to obtain a court order to query an American's information would be overly burdensome.

"I am especially concerned about one frequently discussed proposal, which would require the government to obtain a warrant or court order from a judge before personnel could conduct a 'U.S. person query' of information previously obtained through use of Section 702," then-FBI Director Christopher Wray told Congress in 2023, amid the last reauthorization fight.

"A warrant requirement would amount to a de facto ban, because query applications either would not meet the legal standard to win court approval; or because, when the standard could be met, it would be so only after the expenditure of scarce resources, the submission and review of a lengthy legal filing, and the passage of significant time — which, in the world of rapidly evolving threats, the government often does not have. That would be a significant blow to the FBI," Wray said.

What do civil liberties and privacy advocates say about the legislation?

Privacy advocates say that, as written, the FISA statute allows the government to spy on the communications of Americans and others in the U.S. without the permission of a court, in contravention of the privacy guarantees in the Fourth Amendment.

"The FBI — and every other agency that receives Section 702 data — routinely goes searching through that data for the express purpose of finding and using Americans' communications," according to Elizabeth Goitein, senior director of the Brennan Center's Liberty and National Security Program. "The government conducts literally thousands of these backdoor searches every year."

Lawmakers in support of reforming Section 702 share her concern.

"The Foreign Intelligence Surveillance Act is supposed to be about surveilling foreigners overseas. That way the government doesn't need a warrant," Sen. Wyden told The Lever. "But because so many of these targets are going to be talking to Americans, Americans get swept up in these searches, and that's what I want to have some checks and balances on."

Rep. Tim Burchett, a Tennessee Republican, said in a video that his concerns stem from past privacy violations from the government: "The system was abused and they spied on thousands of Americans, violated the Fourth Amendment of the Constitution — and, well, it was a horrible situation."

Has Section 702 information been improperly used to surveil American citizens?

Yes, the Foreign Intelligence Surveillance Court characterized the FBI's violations as "persistent and widespread" in a 2022 court document that recertified the 702 program.

Documented abuses, detailed in congressionally mandated transparency reports from the Office of the Director of National Intelligence, include warrantless searches for a U.S. senator, journalists and political commentators, 6,800 Social Security numbers, 19,000 donors to a congressional campaign and an FBI employee's family member, who the employee's mother suspected of having an extramarital affair. Anti-surveillance advocacy group Demand Progress put together a detailed timeline of major violations by the FBI and intelligence agencies, as identified by the FISC.

What are the current restrictions on queries for Americans' information by federal law enforcement?

FBI agents must receive annual training on FISA and are generally prohibited from searching for information about people in the U.S. if the sole goal of the search is to investigate general criminal activity, rather than find foreign intelligence information, and those searches need approval from a supervisor or an attorney.

More senior approval is required when searching for information connected to U.S. political or media figures. Moreover, information from queries cannot be used without court authorization to conduct criminal investigations of people in the U.S., unless the charges pertain to national security, death, kidnapping, serious bodily injury, or a handful of other serious crimes.

According to disclosures from the bureau, the number of searches for Americans has declined dramatically in recent years — from 119,383 queries from December 2021 to November 2022 to 7,413 queries in the same 2024-2025 window. Civil liberties advocates note that the full scale of searches can't be known — an October 2025 Justice Department watchdog report noted that a now-shuttered tool allowed untracked searches.
Copyright 2026 NPR

Progressive California Democrats, who have long fought and failed to raise taxes on the rich, are renewing their push this year in light of a specific threat: The seismic federal cuts to Medi-Cal, the state’s health care program for the poor.

President Donald Trump’s H.R.1, signed into law last July, is estimated to strip tens of billions a year in state Medi-Cal funding and cause 2 million low-income residents to lose coverage. It has prompted progressive lawmakers and health care advocates to call for higher taxes on corporations or billionaires to keep those at risk of losing benefits on the program.

“We know that you are not responsible for these awful cuts, but now the responsibility does lie in your hands,” Judy Mark, executive director of Disability Voices United, an advocacy group for people with disabilities and their families, told state lawmakers at a January rally. “You have the power to increase our revenue so that we don’t have to make such devastating cuts.”

Progressive lawmakers have introduced at least two proposals to tax corporations, including one that would direct funds toward Medi-Cal. Separately, health care advocates are backing a controversial ballot measure to tax billionaire wealth to replace lost federal dollars.

There’s one glaring problem: Any solution to backfill the Medi-Cal funding could add to the state’s already gigantic structural budget deficit, not reduce it.

The deficit could reach $30 billion in future years — so large that the state is already struggling just to sustain the reduced level of care under H.R.1, let alone paying the federal government’s share.

Backfilling the Medi-Cal cuts would make the gap larger, said Keely Martin Bosler, former state finance director with more than two decades of experience in state fiscal policy. To “maintain the same insured level of coverage, those costs are on top of the deficits that exist, and so that would be significant.”

California, in its fourth consecutive year projecting a deficit, will likely see bigger shortfalls in future years as spending continues to outpace revenue. Even if the state spends nothing to backfill federal cuts, the deficit could reach $22 billion in fiscal year 2027-28, according to Gov. Gavin Newsom’s January budget proposal.

Democratic lawmakers, who already cut certain Medi-Cal benefits and froze new undocumented adult enrollment last year to close a $12 billion budget hole, acknowledge that the state should now combine sustainable revenue increases with ongoing program cuts to address the sizable deficit as recommended by the nonpartisan Legislative Analyst’s Office.

Yet it’s likely that no meaningful revenue increases will materialize this year.

The Fair Games Coalition, made up of community leaders, labor organizations and advocates, announce the launch of the Overpaid CEO Tax Initiative in West Hollywood on Jan. 14, 2026.

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Genaro Molina

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Los Angeles Times via Getty Images

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Newsom, in his last year as governor, has opposed any wealth tax over concerns that it would drive high-income earners out of California and dampen the tax base. Passing any tax increases would also require a two-thirds vote in each legislative chamber, a high bar even with a Democratic supermajority.

“I don’t think anything is going to happen this year,” said Senate Revenue and Taxation Committee Chair Jerry McNerney, a Stockton Democrat. “So why look at options that are doomed to fail in the first place?”

A $44 billion problem

The state is constitutionally required to direct roughly 50 cents of each dollar in excess general fund revenue toward K-14 education and reserves. That means the state would need roughly $44 billion in new revenue annually to close a $22 billion budget hole.

Existing legislative proposals don’t come close to raising that much.

Progressive Democrats are consolidating behind a pair of tax proposals, including one that would close the “water’s edge” loophole, which allows multinational corporations that opt in to only pay taxes on income made within borders of California. That allows companies to establish subsidiaries offshore to avoid paying taxes on their profits, said bill author Assemblymember Damon Connolly, a San Rafael Democrat.

Connolly told CalMatters his bill would raise $3 to $4 billion annually. But the revenue could swing, and corporations could still find new ways to reduce their California taxes, according to an LAO evaluation of different tax options.

Acknowledging that the amount wouldn’t close the entire structural deficit, Connolly said it’s “a step in the right direction.”

“It’s only one part of the equation. It’s certainly the time to look at potential revenue solutions but also obviously roll up our sleeves and take a hard look at the budget,” Connolly said. He did not specify which areas he’d consider cutting, saying only that protecting health care is where state lawmakers should “draw the line.”

Another bill by Assembly Health Committee Chair Mia Bonta, an Oakland Democrat, would require businesses whose workers rely on Medi-Cal and food stamps to contribute to a fund to “prevent loss of or to restore” health care coverage under H.R.1. There are no details yet on how much the charge would be.

And there’s the 2026 California Billionaire Tax Act proposed by the SEIU-United Healthcare Workers West, which would apply a 5%, one-time tax on billionaires’ wealth and use most of the revenue to backfill federal health care cuts. The initiative would establish a special fund that would exempt the revenue from constitutionally required deposits into education and savings.

Supporters estimate it would generate $100 billion over five years. SEIU-UHW spokesperson Suzanne Jimenez told CalMatters that it would allow the state to temporarily continue providing Medi-Cal coverage at the same level while giving state leaders time to figure out how best to sustain it.

But even if voters approve the tax measure, critics say the funds could get locked up in court from lawsuits by billionaire taxpayers or by education groups, who might argue it skirts the state’s constitutional requirements to benefit schools. And it’s unclear how the state would sustain the funding after the money runs out: An LAO analysis estimates that the measure could drive away billionaires and reduce income tax revenue the state could collect in future years.

“The first step is to pass the billionaire tax so that we have five years to work on that plan. And then, right after Election Day, we will be ready to work with the next governor to figure out a long-term solution,” Jimenez said.

Taxing the rich frenzy faces an uphill battle

While they might do little to address the state’s structural deficit, proposals to tax the rich shrewdly tap into the public anxiety with “rather extraordinary disparity in the distribution of income and wealth,” said Kirk Stark, a professor of tax law and policy at UCLA.

“I think that targeting the rich is understandable, but I don’t think that it’s really the kind of policy that can be expected to durably address very long-term structural fiscal imbalance,” he said.

More than 60% of California’s likely voters support higher taxes on the state’s wealthiest to help with the state’s budget deficit, according to a February survey by the Public Policy Institute of California.

The sentiment especially speaks to progressives, who have made fighting income inequality a core belief. But even the popular idea faces an uphill climb: Some Democrats contend that raising taxes on the state’s highest earners risks driving them away, especially since the state heavily relies on their income tax.

Janitors, nurses, teachers and labor organizers rally at the state Capitol in Sacramento to launch UnRig California on March 11, 2026. The initiative is a multiyear campaign aimed at reforming the state’s economy and tax code.

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Miguel Gutierrez Jr.

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CalMatters

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“The wealthiest Californians are also the most mobile Californians,” said former Assembly Budget Chair Phil Ting, a San Francisco Democrat. “They could easily decide to go domicile in some other parts of the country.”

It also could deter businesses and billionaires from moving to California. “Does it signal that California is not a friendly, accommodating jurisdiction for people who want to amass billions upon billions of dollars of wealth?” Stark said.

Other ideas to address the state’s budget needs more systemically could pose even bigger political risks, especially as the state’s revenue is booming thanks to an AI-driven economy.

Stark said the state should examine its three primary revenue sources: income tax, sales tax and property tax. Since taxing income could dampen the incentive to work, and sales tax could discourage consumption, the state’s property tax — capped at 1% of the property value by Proposition 13 in 1978 — “jumps out as a tax reform that needs to happen in California,” he said.

“Not something that’s going to be just a one-time hit on the elite, but a fundamental, structural reconsideration of how the state of California taxes the value of land and structures.”

But any proposal to reform Prop. 13 would likely ignite a fierce political battle, just like the patchwork of ballot initiatives over the past half-century to amend Prop. 13 by carving out tax breaks or loopholes to hike taxes.

It’s even harder now with affordability being top of mind for Californians, Ting said.

“People are very cost-sensitive because they feel that their groceries are going up, their gas is going up, rent is going up, it’s a very difficult time to introduce even further costs in taxes to middle-class Californians.”

This article was originally published on CalMatters and was republished under the Creative Commons Attribution-NonCommercial-NoDerivatives license.

A nonprofit organization created by the California State Library to improve childhood literacy has spent more than $1 million in taxpayer money but has yet to put a single book in the hands of a child.

Lawmakers grilled State Librarian Greg Lucas and other officials about the organization’s spending in a contentious three-hour hearing April 7, with one lawmaker saying it raises “serious questions.”

Lucas, however, blamed the shortcomings on the fact that legislators themselves pulled the organization's funding prematurely. After the hearing, he told CalMatters in a statement that “every taxpayer dollar spent on this program is fully accounted for.”

In total, lawmakers allocated $70 million in 2022 to improve children’s love of reading with the intent of giving some of the money to Dolly Parton’s Imagination Library and some of it to a local organization.

The California-based Strong Reader Partnership was formed by the state library as the local partner, and it was originally set to receive $19 million. But in 2024, with very little of the money spent, lawmakers redirected the money to the Dollywood Foundation, which oversees Parton’s Imagination Library. Ultimately, the project has been able to meet many of its goals, the Dollywood Foundation told legislators this year. In all, it has served more than 160,000 children in California and distributed nearly 3 million books. The foundation is administering the program but not donating any money toward the project.

Although the $1 million spent by the Strong Reader Partnership is small, relative to the total project budget, Sen. Sasha Renée Pérez, a Pasadena Democrat, and Sen. Shannon Grove, a Bakersfield Republican, said in the hearing that it’s their job to ensure it was still spent correctly, especially since the money was designated for children.

In the hearing, Pérez and Grove questioned the Strong Reader Partnership’s finances, repeatedly stating that its accounting practices and business activities were ineffective, negligent or potentially in violation of its state contract. Grove pressed Lucas about why he created a separate nonprofit instead of giving the money directly to the Dollywood Foundation, even though she herself required the state library to do so.

In 2022 Grove authored the law that created the program. The bill required “the State Librarian to coordinate with a nonprofit entity, as specified, that is organized solely to promote and encourage reading by the children of the state.” The Dollywood Foundation, which is national and based in Tennessee, was not eligible to be that nonprofit entity.

When CalMatters asked Grove why she is criticizing the state library’s formation of a nonprofit when her bill required it, she responded by email but didn’t answer the question. Instead, she reiterated her criticisms of the Strong Reader Partnership, saying that its money was “squandered away without putting books in kids’ hands.”

Letters to lawmakers 

State lawmakers first questioned the Imagination Library project in 2024, when budget officials, faced with closing a nearly $50 billion state deficit, told lawmakers that most of the money for the program remained unspent nearly two years after its launch. That year, the governor signed a bill keeping the money intact but requiring 90% of it go directly to the Dollywood Foundation instead of the Strong Reader Partnership or any local nonprofit. The foundation did not respond to CalMatters’ questions about its relationship with the Strong Reader Partnership.

Sonya Harris, executive director of the Strong Reader Partnership at the time, spoke out against that 2024 bill and said she sent letters to legislators opposing it.

Lawmakers said speaking about the bill was a violation of her contract. “You're attempting to influence legislation when it's explicitly stated that you are not supposed to use state taxpayer dollars to do so. Do you agree?” asked Pérez during the April 7 hearing. Harris didn’t answer the question.

Also during the hearing, Pérez repeatedly questioned the organization’s financial management, referencing instances when checks bounced, reports were not completed or documents arrived months after lawmakers had requested them. “As far as I can see here, there (were) no local partnerships that you all established in order to facilitate this program over a two-year period,” she said. “We are not able to understand what you did with these dollars and that’s the whole purpose of this hearing.”

Contracting with nonprofits comes with risks

The roughly $1 million in state funds that went to the Strong Reader Partnership is less than a thousandth of 1% of the state’s total spending, but that’s not the point, Pérez said

“Comments have been made about the amount of money that this is, and that it might be small relative to the budget,” she said before closing out the hearing. “But for me, as a public servant, I take this very seriously. We need to ensure that when we're making a commitment to provide something as simple as books to children, that we're actually delivering on that commitment.”

State and local lawmakers routinely sign contracts and grant money to businesses, including many nonprofit organizations, to enact public services or programs. In the process, taxpayers “lose transparency,” said Susan Shelley, vice president of communications for the Howard Jarvis Taxpayer Association, a group that opposes higher taxes. “Why is the state government or the local government turning them over to nonprofits instead of having their massive bureaucracies handle these things where someone is accountable?”

Shelley said the responsibility lies both with the nonprofits and the Legislature, especially in this instance, because Grove’s bill required the California State Library to work with a local nonprofit.

Normally, the Howard Jarvis Taxpayer Association is strongly aligned with Grove. Last year, the organization gave her an A+ based on her voting record on tax-related issues.

This article was originally published on CalMatters and was republished under the Creative Commons Attribution-NonCommercial-NoDerivatives license.