It’s high dealmaking season in Sacramento

With help from Camille von Kaenel and Blanca Begert

FIVE MORE MINUTES: Deadlines have a magical ability to distill months of work into something readable — or leave writers groveling for an extension.

Nowhere is that truer than Sacramento, where oil companies are weighing their options ahead of Thursday’s cutoff to place voter initiatives on the November ballot — and lawmakers writing a climate bond have already made plans to blow through the deadline.

It’s not looking great for the California Independent Petroleum Association’s proposal to overturn a 2022 law banning drilling within 3,200 feet of homes, businesses and schools: It’s polling poorly, and environmentalists are already buying ads to try to knock it down further.

And Gov. Gavin Newsom, who’s been negotiating agreements to clear other initiatives from the ballot, hasn’t signaled any willingness to cut a deal with one of his favorite political foils. His latest swipe came in Tuesday’s State of the State speech, where he said Californians are “defending ourselves from their profit-driven greed, drilling their oil rigs next to houses and daycare centers.”

But with one day to go before CIPA has to either pull the initiative off the ballot or commit to enduring four more months of negative ads, it could still be used as a bargaining chip to weaken any of several pieces of legislation targeting oil wells. Talks are going cordially, if Tuesday’s interaction between CIPA’s chair, Jonathan Gregory, and Assemblymember Isaac Bryan is any indication.

The two engaged in a handshake-hug combination before sitting down to exchange barbs over Bryan’s AB 2716, which would charge oil well owners $10,000 per day for operating wells within the 3,200-foot zone that produce less than 15 barrels per day. It’s intended to disincentivize producers from keeping wells in operation just to avoid the costs of plugging them.

“If you are going to drill right next to my grandmother’s house, then you better be extracting enough oil to lower my gas prices,” Bryan said at Tuesday’s Senate Natural Resources and Water Committee hearing.

Gregory said he would have to shut down the majority of the wells that his Matrix Oil Corp. operates in La Habra Heights, just east of Bryan’s Los Angeles district, and lay off all of his 16 employees.

“Maybe that’s not what you think about when you think about Big Oil,” he said.

Talks over another looming deadline are somewhat less sanguine.

Environmental groups are getting frustrated with the Senate’s pace on crafting a $10 billion climate bond after Senate President pro tem Mike McGuire announced Monday that lawmakers could maneuver around the original Thursday deadline.

Staff in the Assembly and in Newsom’s office are also frustrated that senators continue to tinker with the proposal after a deal was close to being reached last week, according to two legislative sources with knowledge of the negotiations whom POLITICO granted anonymity. Newsom’s office didn’t respond to a request for comment, while McGuire’s and Assembly Speaker Robert Rivas’ said they didn’t have anything new to add on the negotiations.

“It’s been floating through the ether since last year,” said one environmentalist whom POLITICO granted anonymity to discuss confidential negotiations. “How is it that it’s gotten this far and still has been so ambiguous and amorphous? It’s honestly super frustrating.”

The language has to get to the printers by July 3 in time to put it in the November election information guide given to voters. That means McGuire can’t push the deadline past Friday, under the Legislature’s rule requiring legislation to be in print for 72 hours before being eligible for a vote. No holding those presses! — WV, AN

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PICK ME: The Insurance Department’s proposal to require insurers to offer more policies in disaster-prone areas is pitting regions wanting relief against each other.

The proposal is at the heart of Insurance Commissioner Ricardo Lara’s reforms to entice insurers who fled record-breaking wildfire losses back to the state: He’ll let them use forward-looking models that could increase rates, but only if they increase their policies in the communities most struggling to find insurance.

To identify those places, insurance officials developed a complicated formula that takes into account the concentration of FAIR Plan policies, the insurance industry’s wildfire risk scores, Cal Fire’s fire hazard determinations and the cost of coverage. Much of wildfire-prone Northern California would qualify, as would the Sierra Nevada foothills, the Central Coast and pockets of Southern California.

But Robert Macaulay, a Madera County supervisor, suggested the map was too broad during an Insurance Department workshop today by drawing a contrast between his rural forested community and wealthy Southern California communities.

“It concerns me that … we’re included in other communities like Beverly Hills,” said Macaulay. “I think those will obviously be the areas that insurers are targeting, so I’m very concerned that folks in my district, as well as neighboring districts again will be left out and will remain largely dependent upon the FAIR Plan.”

Others suggested the map was too narrow.

“We have heard from our cities that that doesn’t cover all of the areas that have received either non renewals or have been dropped, and there’s some concern,” said Jolena Voorhis, from the League of California Cities.

Lara has said he wants to finalize the new rules by the end of the year. — CvK

LEADED FUEL: Sen. Caroline Menjivar’s bill to regulate leaded aviation fuel cleared another hurdle and is headed to the Assembly Appropriations Committee.

SB 1193, which originally would have phased out the sale of leaded plane fuel starting in 2026, has gone through numerous rounds of amendments. Most notably, Menjivar pushed back the start date earlier this month: The bill would now prohibit leaded fuel sales beginning in 2031, in alignment with May rules from the Federal Aviation Administration.

To get it through the Assembly Local Government Committee today, she took another amendment to resolve any conflict related to airports with grant obligations to fulfill for FAA grants. That got the statewide airport association and pilot association to go neutral, with opposition now just remaining from the Western States Petroleum Association and the Rural County Representatives of California.

She said it’s her biggest priority this year.

“I spoke with [Assembly] Speaker [Robert Rivas] yesterday to let them know this is my number one priority on the Assembly,” Menjivar said in an interview. “Obviously, he didn’t commit to anything, but it’s on his radar that this is going to be a huge thing for me to get off the Assembly floor.” — BB

— California firefighters are being denied workers’ compensation for PTSD.

— Tech utopia California Forever finally released its water plan, but some questions remain about its intent to draw a third of its water from diverted rivers.

— AI is already taking attention and money (and copper) away from climate change mitigation.