The Brief

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Companies backing data center construction are flooding Sacramento with cash, hoping to stop or defang seven bills that would regulate the facilities as they head toward approval in the California Legislature this week.

The pro-data-center spenders include Big Tech companies like Amazon and AI titan Anthropic. But they are led, dollar-wise, by old school utility giant Pacific Gas & Electric, which earlier this year clocked its second biggest lobbying quarter since 1999.

The financial push comes a year after four bills that attempted to regulate data centers died or were diluted after lobbying from the industry. But as artificial intelligence fuels an unprecedented facility buildout, public backlash is transforming data center construction into a major issue for candidates in upcoming elections.

A May Gallup poll found seven in 10 Americans oppose data center construction in their communities, while a Public Policy Institute of California poll in July found similar opposition statewide. Rising public anxiety over utility costs, water use, and grid strain has driven California lawmakers to propose strict new data center rules — igniting a high-stakes lobbying push by the industry.

Hundreds of cities have considered or passed project bans this year, including in Monterey Park, where voters passed a ballot measure to permanently ban data centers, and Bay Area cities like Pittsburg, which backtracked on approvals following public outcry.

State law requires businesses and groups that engage in lobbying to report their overall quarterly spending, but does not require a breakdown of exactly how much is being spent on each bill. An analysis by CalMatters of lobbying activity for the first six months of 2026 found that utilities, tech companies and their proxies have spent millions of dollars lobbying state lawmakers, with data center bills emerging as a primary focus.

By Monday, it will be clear which bills made it out of the Legislature and onto Gov. Gavin Newsom’s desk for signature or veto by the end of September.

The fate of the measures could have far-reaching consequences, affecting not only data center development but environmental regulation, utility rates, and how freely California’s tech giants can operate in the state. Nationally, advocates and lawmakers agree that California’s regulation around data centers could be an important bellwether for how similar fights will play out elsewhere.

“The level of awareness is through the roof, and the level of concern and sensitivity is through the roof — it's bipartisan, it's national, and it's across the board,” California Sen. Steve Padilla, a Democrat from Chula Vista who is author of two pending data center bills, told CalMatters.

Who is lobbying on data centers?

During the first half of 2026, Amazon paid more than $500,000 to lobby lawmakers on 33 pieces of legislation, including several data center bills and matters related to antitrust and artificial intelligence. Amazon spent more than $1.7 million lobbying in California last year.

Meanwhile, AI company Anthropic, which sent its first lobbyists to Sacramento last year, has spent nearly $90,000 to influence decisions made by the California Legislature so far this year and, according to the Financial Times, nearly tripled its federal lobbying spend in the same time period. Last year, Anthropic spent over $200,000 lobbying in the state.

Although Anthropic paid a lobbyist to influence lawmakers decisionmaking on data centers, a spokesperson said the company does not support or oppose any specific bills in California. The company, the spokesperson said, is also interested in working with lawmakers “on AI safety and other relevant issues." Representatives for Amazon did not respond to a request for comment from CalMatters.

Utility giant PG&E’s latest filing shows that it spent $2.86 million lobbying in California between April and June — its second highest quarter since 1999 (only surpassed since then by 2018, the year of the deadliest wildfire in state history, later linked to its equipment). A spokesperson for PG&E said the company has engaged on a “broad scope” of issues facing the industry during this legislative session, adding that “less than 5% of our spending was on data-center related issues,” amounting to approximately $143,000.

Groups acting as proxies for data center operators and tech companies have been especially active this year in California’s capitol, critics say. Business interests say they are trying to ground policy conversations in reality.

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Other utilities, like Southern California Edison, and unions representing utility workers, like the International Brotherhood of Electrical Workers, have also invested in lobbying efforts on the bills.

Utilities providers are particularly motivated to influence bills because the development of new data centers represents a historic opportunity for expansion and grid upgrades, according to Matthew Freedman, senior staff attorney for The Utility Reform Network. Under the current regulatory framework, he said, the cost of expanding transmission lines is spread across all grid users, which means everyday consumers foot the bill.

But several of this year’s data center bills would change that, shifting costs back toward data center operators. “The groups that have been the strongest opponents of the bills this year include the proxies for the data centers and the tech companies,” Freedman said, referring to industry groups such as the Data Center Coalition, Silicon Valley Leadership Group and the California Chamber of Commerce. “They serve as a mouthpiece for the tech industry.”

Filings do not show that tech giants like Google, OpenAI, Meta, and Microsoft are lobbying lawmakers directly on data centers this session. Instead, the business groups Freedman referenced, which represent the Big Tech firms, carry the weight.

Silicon Valley Leadership Group, which represents companies including Apple and Amazon, has so far spent over $100,000 lobbying on bills including the various data center measures this year and is on track for its highest annual lobbying spend since tracking began in 2005.

The Data Center Coalition, which counts companies like Google, Microsoft, and OpenAI among its members, has logged its second and third highest-ever spending quarters so far this year. It has spent roughly $60,000 lobbying state lawmakers and the governor’s office to voice opposition to nearly every bill that would regulate data centers.

The bills and the backlash 

The measures before the Legislature this session include:

• Bills to shift electric infrastructure costs toward data center operators and away from residential customers: SB 1168, SB 886 and AB 2383.
• Bills mandating disclosures or estimates of water usage (and sometimes usage of other resources): AB 2619 and two bills that cleared the Legislature Thursday, AB 1577 and AB 2469.
• SB 887, which would require all data center projects to undergo environmental reviews and offer fast-tracked approval for facilities that meet standards for water and energy conservation.

Business interests opposed to the bills argue they would stifle tech companies’ ability to innovate and compete, tie up critical infrastructure in red tape and unfairly burden the construction of data centers versus the construction of other types of projects.

Silicon Valley Leadership Group CEO Ahmad Thomas told CalMatters that he sees public debate over data centers as fueled by “strong anti-AI sentiment,” and that industry groups like his aim to “ground the conversation in reality” about the ways consumers rely on data center infrastructure for everyday services.

Advocacy groups counter that transparency is vital to protect the environment and public resources, and that everyday consumers should not be affected by increased infrastructure and utilities costs.

Britt Smith, who is part of a community group organizing against a controversial $2 billion Amazon data center project in Gilroy south of San Jose, said corporate opponents of the bills are “spending so much because there’s so much at stake,” adding, “Our future, our safety, is not for sale.”

This robust fight stands in stark contrast to last year, when the only bill signed into law was stripped down to just a requirement for state energy regulators to publish an environmental impact study on data centers’ electricity demand. Newsom also vetoed a water usage disclosure bill, citing concerns that regulation could stifle AI growth.

Whether this year's intensified lobbying will yield similar results remains uncertain, but lawmakers say shifting voter sentiment heading into the midterms has altered the political landscape.

“When you're looking down the barrel of public outcry that says we don't want [data centers] at all, and you've got localities that are saying they’re going to ban them, then you know the atmosphere has changed,” Assemblymember Diane Papan, a San Mateo Democrat who authored two of the bills, told CalMatters. “We are in a totally different environment this year.”

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

A high-profile fight between California Attorney General Rob Bonta and Paramount Skydance resolved Monday with a settlement that clears a path for the company to continue with its planned acquisition of another century-old studio, Warner Bros. Discovery.

The deal comes after Paramount threatened to leave the state over an antitrust lawsuit led by Bonta and attorneys general from 11 other states that sought to block the $111 billion merger.

Paramount Chief Executive David Ellison reportedly told senior leaders of the company “clearly we’re not wanted here,” during a meeting in August. However, California has taken several steps since the 2000s to retain studios like Paramount.

The fight was the latest chapter in the battle for Hollywood, which has been a priority for California lawmakers and the last three governors.

Here are some ways the state has tried to keep its storied industry:

• Program 1.0: In 2009, in response to other states beginning to offer financial incentives for motion picture production, Gov. Arnold Schwarzenegger signed the state’s first California Film and Television Production Tax Credit. The program allocated $100 million per year to eligible film and TV production companies through 2017.

• Program 2.0: In 2014, lawmakers approved Assembly Bill 1839, which Gov. Jerry Brown signed into law, creating a new version of the Film and Television Production Tax Credit program and more than tripling the credits to $330 million annually through 2020.

• 2018 expansion: In 2018, Brown again authorized an extension of the program for another five years, through 2025. Following the COVID-19 pandemic that shut down productions, Gov. Gavin Newsom boosted the credit temporarily to $420 million annually.

• 2025 increase: Hollywood was struggling following the “quadruple-whammy” of the COVID-19 pandemic, a writers strike, deadly wildfires and growing production incentives from other states that lured movies out of California. In response, lawmakers increased the yearly credit in 2025 to $750 million per year until 2030. Newsom championed the boost, saying the industry was “on life support.”

• This year, when the film and television production tax credit clashed with an initiative to cap corporate tax breaks, lawmakers carved independent film producers out of the groups subject to a new cap.

• In July, Democratic Assembly Speaker Robert Rivas of Salinas created the “Select Committee on Growing and Retaining the Creative Economy in California” to, in part, keep film and television production in the state.

• On Saturday, Newsom signed Assembly Bill 2319 by Burbank Democrat Nick Schultz to create a new tax credit for post-production work, including editing and visual effects.

Assemblymember Rick Chavez Zbur, a Democrat representing Hollywood, said he was delighted a deal was reached to keep Paramount in California, but that the state needs to do more to retain the industry. Zbur is chair of the state’s new Assembly committee focused on keeping film production in California.

“Now that other states are realizing what important, family-sustaining jobs these are, they're competing very aggressively for these jobs,” he said.

Zbur said the committee will explore new state incentives during its first meeting, which he expects will take place in October in Los Angeles.

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

Beginning Jan. 1, 2027, many Medi-Cal enrollees will face new work requirements and eligibility checks — the result of sweeping federal changes that could affect more than 1 million L.A. County residents, according to organizers of a new countywide outreach campaign.

If you are a Medi-Cal enrollee between ages 19 and 64, you may soon need to show you're working, volunteering, going to school or in a job training program for at least 80 hours a month or otherwise earning income to keep your public health insurance coverage.

Some enrollees will also have to prove they’re eligible every six months instead of once a year.

Parents of children 13 and younger, pregnant women, older adults and people with disabilities are largely exempt from the requirements.

What to do to prepare

• Keep your address and phone number current with your county Medi-Cal office.
  
• Watch your mail, and respond promptly to Medi-Cal notices in yellow or white envelopes.
  
• If you're unsure what a notice means, community health centers and trained volunteers can help in person and in multiple languages, county officials said.

How we got here

Nearly 4 million L.A. County residents, or 41% of the population, rely on Medi-Cal — California’s version of Medicaid, a joint federal and state insurance program providing free or low-cost coverage to low-income people.

President Donald Trump, joined by Republican lawmakers, signs the "One, Big Beautiful Bill Act," a massive spending and tax bill, at the South Lawn of the White House in Washington, D.C. on July 4, 2025.

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President Donald Trump signed the “One Big Beautiful Bill” — formally H.R. 1 — in July 2025, and it reduced federal Medicaid funding while adding a requirement that people who receive benefits work or show they are going to school, volunteering or seeking job training.

The new requirements and six-month renewal rules apply to adults 19-64 covered through Medi-Cal’s Affordable Care Act expansion, according to county officials.

In June, the federal Centers for Medicare & Medicaid Services issued the rule that implements the work requirement. CMS said in a news release that the framework is meant to promote economic stability and self-sufficiency.

“This rule helps Americans build skills and independence through work, education, job training, or community service, creating new opportunities for themselves and their families,” CMS Administrator Mehmet Oz said in a statement.

Later that month, states including California sued to challenge the changes. In July, a federal judge denied their request to pause the rules while the lawsuit continues.

Last week, L.A. Care Health Plan, which administers Medi-Cal benefits for many county residents and other partners, launched “Keep L.A. Covered,” a public campaign to train community leaders, including pastors, teachers and health workers, to warn Medi-Cal recipients about renewal notices. The first training is Oct. 27, hosted by Maternal Child Health Access.

County officials say people and organizations that want to get involved can sign up at www.keeplacovered.org.

Paperwork hurdles

Campaign leaders say people are more likely to lose coverage because a notice went to an old address or went unanswered than because they stopped qualifying for Medi-Cal.

"One missed notice, one missed deadline, one moment of confusion can mean them losing their coverage, and it's not because they're no longer eligible," Martha Santana-Chin, CEO of L.A. Care, said at a campaign launch last week. "It's simply because they haven't been able to navigate the paperwork that's ahead of them.”

The state of California is already mailing letters about the changes, Santana-Chin said.

If the state can't verify compliance, it must send a noncompliance notice and give the enrollee 30 days to prove compliance or an exemption. Otherwise, the application may be denied, or the person disenrolled.

Advocates say the risk is greatest for people without a stable mailing address. Statewide, most people experiencing homelessness are eligible for or already enrolled in Medi-Cal, according to the California Health Care Foundation.

The 2026 Los Angeles Homeless Services Authority homeless count estimated more than 73,000 people were experiencing homelessness in L.A. County. Many would qualify for medical exemptions that would allow them to receive Medi-Cal benefits without proof of work or other requirements, but claiming an exemption requires clinical documentation and regular contact with the healthcare system, the foundation said. Federal guidance doesn't let states exempt people from the requirements solely for being unhoused.

Some details of the 80-hour monthly work requirement remain unsettled. The federal government is still writing the details on what counts as qualifying work, volunteering or education, Santana-Chin said.

The Centers for Medicare and Medicaid Services projects the requirement will reduce Medicaid enrollment nationwide by more than 3 million people. The federal agency assumes about 15% of enrollees will lose coverage, about 9% because they don't meet the requirement and about 6% because of paperwork or other administrative barriers. The actual effect depends on how states carry out the rules, according to a recent report from the federal agency.

The Congressional Budget Office, which analyzed the law using different methods, estimated the requirement would leave 5.3 million more people uninsured in 2034.

Facing growing public backlash and a pivot from his own past vetoes, Gov. Gavin Newsom signed a sweeping package of seven bills on Monday that aim to force the data center industry to pay its own way in California.

Three of the new laws shift electric infrastructure costs away from residential customers and toward data center operators, three more mandate disclosures of water usage and other resources, and the last one makes data centers ineligible for environmental review exemptions.

Newsom, in a written statement, contrasted the new regulations with President Donald Trump’s hands-off approach to data centers and artificial intelligence.

“We know that we don’t have to sell out Californians or sacrifice our well-being to innovate and succeed,” the statement read. “California has proven that time and time again. With these laws, we are ensuring that Californians remain in the driver’s seat — and that those profiting from data centers aren’t doing so at our expense.”

Trump has aggressively pushed to accelerate data center development nationwide, arguing that they represent a significant economic opportunity for states that embrace them. He said last week at the All-In Summit, an invite-only conference for business leaders, that the industry is the “oil of the next 20, 25 years.”

Newsom’s signature on the new laws represents a significant departure from his actions on data centers last year, when he vetoed a water disclosure bill over concerns that regulation could stifle AI growth and signed into law only a single stripped-down environmental study bill.

Environmental advocates and the lawmakers behind this year’s bills previously told CalMatters that intensifying public backlash to data center construction propelled the legislation this year, despite a flood of lobbying funds from Big Tech and other business interests that aimed to soften the proposals.

“When you’re looking down the barrel of public outcry that says we don’t want [data centers] at all, and you’ve got localities that are saying they’re going to ban them, then you know the atmosphere has changed,” Assemblymember Diane Papan, a San Mateo Democrat who authored two of the bills which were signed into law on Monday, previously told CalMatters.

Other state legislatures as well as Congress are also advancing new measures to regulate the industry. In May, a Gallup poll found seven in 10 Americans oppose data center construction in their communities, while a July Public Policy Institute of California poll found similar opposition statewide. Hundreds of cities nationwide — including Monterey Park and Bay Area cities like Pittsburg — have either passed data center bans or walked back approvals following public outcry.

Arnab Pal, the executive director of Deploy Action, a nonprofit that promotes clean energy, told CalMatters the new laws are a good step toward preventing data centers from harming consumers through utility rate increases or environmental damage. Still, Pal said, more can be done to ensure such projects actually benefit everyday people through advancements to the electrical grid and the acceleration of clean energy infrastructure.

“I don't think these bills are the end of this fight; I think we're gonna have to do a lot of implementation on the back end and, as other states roll out their policies next year, I think California is going to look back and be like, ‘maybe we should have done more,’” Pal said. “I'm interested to see what we do next year on this.”

Business interests that oppose the measures, like the Data Center Coalition — which counts companies like Google, Microsoft and OpenAI among its members — warn that further regulation could push the data center industry out of California. According to the latest figures from the Data Center Coalition, the industry contributed 665,500 jobs, more than $159 billion in economic activity, and $14.1 billion in federal, state, and local taxes in California in 2024.

Khara Boender, the director of government affairs west for the Data Center Coalition, told CalMatters that “the data center industry shares the goal of ensuring growth of this critical infrastructure is responsible and well managed,” but more work needs to be done “to promote responsible data center growth while maintaining California as a key, competitive market in the global economy.”

Newsom signed the following bills:

• Senate Bill 1168, SB 886 and Assembly Bill 2383, which shift electric infrastructure costs away from residential customers and toward data center operators
• AB 2469, AB 1577 and AB 2619, which mandate disclosures or estimates of water usage and other resources
• SB 887, which makes data centers ineligible for blanket environmental review exemptions, and offers fast-tracked approval for facilities that meet state standards for water and energy conservation

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

Gov. Gavin Newsom has signed a pair of bills that will create a new system for approving community college bachelor’s degrees.

Senate Bill 960 and Assembly Bill 2694, which were sent to Newsom as a two-bill package, will let community college districts create between two and 12 new bachelor’s degrees to fill local workforce needs.

The bills take effect Jan. 1, 2028, and will create a five-tiered system determining how many bachelor’s degrees each district can offer. Districts will be placed into tiers based on the percentage of students who complete a degree or certificate or transfer to a four-year university. Districts with higher graduation and transfer rates will be allowed to create more bachelor’s degrees — up to the maximum of 12.

The tiered system, which was among several last-minute amendments to the legislation, has drawn backlash from community college presidents and chancellors, who say the system will pit colleges against one another.

However, the legislation does make at least one significant change supported by the community colleges: It only prohibits degrees that duplicate CSU programs offered in the same local service area as the community college proposing the degree. In the past, duplication wasn’t tied to location, and community colleges sometimes faced duplication objections from CSU campuses located in different regions of the state.

The legislation also allows for certain circumstances when community colleges can create bachelor’s degrees even if a nearby CSU campus has a similar program. That will be permitted if the CSU program has had a transfer acceptance rate of less than 75% for three consecutive years.