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Newsom’s budget includes $200 million to make up for Trump’s canceled EV rebates, among other climate items

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Newsom’s budget includes 0 million to make up for Trump’s canceled EV rebates, among other climate items

Gov. Gavin Newsom on Friday doubled down on California’s commitment to electric vehicles with proposed rebates intended to backfill federal tax credits canceled by the Trump administration.

The plan would allocate $200 million in one-time special funds for a new point-of-sale incentive program for light-duty zero-emissions vehicles. It was part of a sweeping $348.9-billion state budget proposal released Friday, which also included items to address air pollution and worsening wildfires, amid a projected $3-billion state deficit.

EVs have become a flashpoint in California’s battle against the Trump administration, which moved last year to repeal the state’s long-held authority to set strict tailpipe emission standards and eventually ban the sale of new gas powered cars.

Last year, Trump ended federal tax credits of up to $7,500 for EV customers that were part of President Biden’s 2022 Inflation Reduction Act. In September, his administration also let lapse federal authorization for California’s Clean Air Vehicle decal program, which allowed solo EV drivers to use carpool lanes.

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“Despite federal interference, the governor maintains his commitment to protecting public health and achieving California’s world leading climate agenda,” Lindsay Buckley, spokesperson for the California Air Resources Board, said in an email. “This incentive program will help continue the state’s ZEV momentum, especially with the federal administration eliminating the federal EV tax credit and carpool lane access.”

Newsom had previously flip-flopped on this idea, first vowing to restore a state program that provided up to $7,500 to buy clean cars and then walking it back in September. That same month, a group of five automakers including Honda, Rivian, Hyundai, Volkswagen and Audi wrote a letter urging Newsom and state legislators to establish a $5,000 EV tax rebate to replace the lost federal incentives, Politico reported.

During his State of the State speech Thursday — one year after the devastating Palisades and Eaton fires in Los Angeles — Newsom said California “refuse[s] to be bystanders” while China and other nations take the lead on electric vehicles and the clean energy transition. He touted the state’s investments in solar, hydrogen, wind and nuclear power, as well as its recent move away from the use of any coal-fired power.

“We must continue our prudent fiscal management, funding our reserves, and continuing the investments Californians rely on, from education to public safety, all while preparing for Trump’s volatility outside our control,” the governor said in a statement. “This is what responsible governance looks like.”

Several environmental groups had been urging Newsom to invest more in clean air and clean vehicle programs, which they say are critical to the state’s ambitious goals for human health and the environment. Transportation is the largest source of climate and air pollution in California and is responsible for more than a third of global warming emissions, said Daniel Barad, Western states policy manager with the nonprofit Union of Concerned Scientists.

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“As federal attacks threaten California’s authority to protect public health, incentives are more essential than ever to scale up clean cars and trucks,” Barad said. “The governor and legislative leaders must act now to fully fund zero-emission transportation and pursue new revenue to grow and sustain climate investments.”

Katelyn Roedner Sutter, California senior director with the nonprofit Environmental Defense Fund, called it “an essential step to save money for Californians, cut harmful pollution, spur innovation, and support the global competitiveness of our auto industry.”

While the budget proposal does not include significant new spending proposals, it contains other line items relating to climate and the environment. Among them are plans to continue implementing Proposition 4, the $10-billion climate bond approved by voters in 2024 for programs geared toward wildfire resilience, safe drinking water, flood management, extreme heat mitigation and other similar efforts.

Among $2.1 billion in climate bond investments proposed this year are $58 million for wildfire prevention and hazardous fuels reduction projects in vulnerable communities, and nearly $20 million to assist homeowners with defensible space to prevent fire. Water-related investments include $232 million for flood control projects and nearly $70 million to support repairs to existing or new water conveyance projects.

The proposal also lays out how to spend money from California’s signature cap-and-trade program, which sets limits on greenhouse gas emissions and allows large polluters to buy and sell unused emission allowances at quarterly auctions. State lawmakers last year voted to extend the program through 2045 and rename it cap-and-invest.

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The spending plan includes a new tiered structure for cap-and-invest that first funds statutory obligations such as manufacturing tax exemptions, followed by $1 billion for the high speed rail project, $750 million to support the California Department of Forestry and Fire Protection, and finally secondary program funding such as affordable housing and low-carbon transit options.

But while some groups applauded the budget’s broad handling of climate issues, others criticized it for leaning too heavily on volatile funding sources for environmental priorities, such as special funds and one-time allocations.

The Sierra Club called the EV incentive program a crucial investment but said too many other items were left with “patchwork strategies that make long-term planning harder.”

“Just yesterday, the Governor acknowledged in his State of the State address that the climate risk is a financial risk. That is exactly why California needs climate investments that are stable and ongoing,” said Sierra Club director Miguel Miguel.

California Environmental Voters, meanwhile, stressed that the state should continue to work toward legislation that would hold oil and gas companies liable for damages caused by their emissions — a plan known as “Make Polluters Pay” that stalled last year amid fierce lobbying and industry pressure.

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“Instead of asking families to absorb the costs, the Legislature must look seriously at holding polluters accountable for the harm they’ve caused,” said Shannon Olivieri Hovis, California Environmental Voters’ chief strategy officer.

Sarah Swig, Newsom’s senior advisor for climate, noted that the state’s budget plan came just days after Trump withdrew the United States from the United Nations Framework Convention on Climate Change, a major global treaty signed by nearly 200 countries with the aim of addressing global warming through coordinated international action.

“California is not slowing down on climate at a time when we continue to see attack after attack from the federal government, including as recently as this week with the Trump administration’s withdrawal from the UNFCCC,” Swig told reporters Friday. “California’s leadership has never mattered more.”

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Gas is $10 a gallon at a Big Sur station. The owner explains why his prices can’t go higher

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Gas is  a gallon at a Big Sur station. The owner explains why his prices can’t go higher

The owner of Gorda by the Sea, the lone gas station for several miles in any direction from this remote, scenic hamlet in Big Sur, is charging $9.99 for a gallon of gas because, well, that’s as high as the digital numbers on the gas pumps allow.

“The software only goes to $10,” said Leo Flores, owner of the gas station and mini-market. “I know, sometimes someone wants to make a good story because of it, but we have to tell you why.”

As the lone gas station for at least 12 miles along Highway 1, the service station often prompts drivers to gasp or clutch their wallets at the sight of a $9.99 price tag for a gallon, but Flores insists he’s not trying to price-gouge his customers. In fact, he’s worried that if gas prices go much higher, it might put him out of business.

“People think you make money, but I’m not,” he said in an interview with The Times.

Motorists across the country have been griping since gasoline prices began to surge last month after the start of the U.S.-Israeli war on Iran, which restricted the flow of oil from key oil-producing countries. Flores’ business is an example of how sky-rocketing fuel prices are having ripple effects throughout the economy.

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The isolated gas station has been featured in the news in the past for its high prices, but Flores, who has owned the station for the last 30 years, said there’s a simple reason why the cost is so high.

“We run this place on generators,” he said. “The generators run on five to six gallons of gasoline every hour.”

It’s not just the gas station that runs on generators, he said. The small oceanside community surrounding the gas station — the mini-market, the cafe, the hotel and nearby cabins — is owned by Flores and runs on generators because there is no access to an outside electrical plant.

“When I explain why to people, they’re happy to pay what I ask them,” Flores said. “It costs me more to make my own electricity.”

According to AAA, as of Friday the national average cost of a gallon of regular gas is up to $4.09, and in California it’s $5.86. In Los Angeles County it’s even higher — about $6 a gallon. At gas stations around Gorda by the Sea, the average cost also sits at $6, according to AAA.

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Flores said he has considered using solar panels to generate electricity, but the initial cost is high. To raise his gas prices any higher, he’d have to buy new pumps, an investment he’s not sure he could afford now.

High prices are not his only worry. The entire hamlet can operate only if Flores’ regular gasoline deliveries make it through on Highway 1 every two weeks.

When the highway shut down for three years because of landslides starting in 2023, he said, he struggled to get gas deliveries to run his generators and survived on only 10% to 20% of the business he normally sees. He barely made it, he said, until the highway reopening in January.

“It’s a big deal,” he said. “If the highway is closed in both directions, I’m screwed.”

Flores complained that no one pays attention to his struggles when Highway 1 closes, but it’s another story when gas prices spike.

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“Why when the highway opens and I raise the price everyone points at me like I’m the bad guy?”

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President Trump bashed State Farm on social media: Why it didn’t come out of the blue

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President Trump bashed State Farm on social media: Why it didn’t come out of the blue

Victims of the January 2025 wildfires unhappy with how insurers have handled their claims have filed lawsuits, protested and complained to local and state officials.

This week, they got support from an unexpected ally: President Trump.

“It was brought to my attention that the Insurance Companies, in particular, State Farm, have been absolutely horrible to people that have been paying them large Premiums for years, only to find that when tragedy struck, these horrendous Companies were not there to help!” Trump posted on Truth Social.

He also asked U.S. Environmental Protection Agency Administrator Lee Zeldin to give him a list of insurers that “acted swiftly, courageously, and bravely” to fulfill their legal obligation and another list of those that were “particularly bad.”

State Farm, California’s largest home insurer, is under investigation for how it has handled January 2025 wildfire claims. In a statement responding to the president’s post, it said it has received 13,700 claims, paid out $5.7 billion and expects total payments could reach $7 billion.

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“Our leadership position in the California homeowners insurance marketplace means State Farm General Insurance Company — the State Farm company that provides homeowners insurance in California — insured more people impacted by this disaster than anyone else,” its statement read.

Tuesday’s post had its origins in a Feb. 4 visit that Zeldin and Small Business Administrator Kelly Loeffler made to the Los Angeles area, where they met with L.A. Mayor Karen Bass, Los Angeles County Supervisor Kathryn Barger and Pacific Palisades fire victims, among others.

The visit was prompted by Trump’s criticism of the slow rebuilding process and by a Trump executive order allowing victims of the Los Angeles wildfires to rebuild without having to deal with “unnecessary, duplicative, or obstructive” permitting requirements.

Aerial image of a neighborhood along Rambla Vista in Malibu taken in December.

(Allen J. Schaben / Los Angeles Times)

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1 A view of destroyed beach-front properties remaining construction-free

2 Aerial image of the remnants of an oceanfront neighborhood

1. A view of destroyed beachfront properties remaining construction-free after the Palisades fire destroyed them last year in Malibu. 2. Aerial image of the remnants of an oceanfront neighborhood in Malibu taken in December after the massive Palisades fire destroyed hundreds of homes and businesses last year. (Allen J. Schaben / Los Angeles Times)

At the time of the order, Bass dismissed it as a “meaningless political stunt,” saying the president has no authority over local permitting but could assist by speeding up Federal Emergency Management Agency funding.

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The American Property Casualty Insurance Assn. industry trade group, in its response to Trump’s post, continued to point fingers at the government. It noted the fires were the third-worst natural disaster in American history in terms of insured losses, at $40 billion.

“Permitting can be a frustrating process, and it can always be improved,” it said in a statement. “Los Angeles has been approving permits three times faster than it was before the fire. However, permit issuance continues to lag.”

Barger, whose district includes the Eaton fire zone in and around Altadena, said this week that she defended the local permitting process to Zeldin. But said she also pointed out complaints about how insurers, and State Farm in particular, have handled claims.

“Many people feel that the insurance industry has let them down, and the number one company that we hear about is State Farm,” she said. “Obviously, Administrator Zeldin met with the president and outlined what I told him.”

Bass, who also spoke on the phone with Trump last month, issued a statement saying she “recently requested that the President intervene with the insurance companies to ensure they pay claims so that survivors can afford to rebuild.”

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“I want to thank President Trump and EPA Administrator Zeldin for taking action and working alongside us to help survivors get the support they need and deserve,” she said.

A White House official said Friday that the EPA was working to produce the list of insurers “as quickly as possible for the president” and the “best way for insurance companies to help is to immediately pay out what they owe so victims can rebuild their lives.”

An aerial view of construction crews rebuilding homes that were destroyed

Construction crews rebuild homes that were destroyed in the Eaton fire in Altadena on March 20.

(Allen J. Schaben / Los Angeles Times)

“Administrator Zeldin, on behalf of the president, is going to hold insurance companies accountable to the great people of California,” the official said.

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The federal government has played a large role in the recovery, including leading the debris cleanup and, as of February, approving 12,600 Small Business Administration loans to fire victims totaling $3.2 billion.

However, a 1945 federal law, the McCarran-Ferguson Act, delegates authority to regulate the insurance industry primarily to individual states.

Joy Chen, executive director of Eaton Fire Survivor’s Network, which represents thousands of fire victims across Los Angeles, said her group believes the federal government has a larger role to play.

“President Trump has the opportunity to restore accountability to this broken system. Federal agencies have the tools to act,” said Chen, who has been sharply critical of State Farm’s claims practices and how California Insurance Commissioner Ricardo Lara has handled complaints against the company.

She specifically called for the Federal Trade Commission to examine “deceptive sales practices” that have left Americans underinsured and for the Department of Justice to investigate “industrywide claims practices that delay, deny or underpay payments owed to policyholders.”

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Lara has defended his treatment of the company, noting regulators opened a probe of State Farm’s claims practices last year.

Martin Grace, a University of Iowa business professor and expert on insurance regulation, said that aside from the “bully pulpit” Trump exercised in his social media post, the federal government’s hands are largely tied.

“He can browbeat people, and Trump’s good at that. And I think the federal government, at one level, only has that. Now, Congress and the president together could say, ‘Listen, we don’t like what the states are allowing insurers to do, and we’re going to change the regulatory system,’” he said.

Grace noted that there was an insurance industry solvency crisis in the 1970s and 1980s that led to a 1990 Congressional report and federal pressure for improved state-level regulation, which was undertaken.

“Congress basically said, ‘Get your act together, or we’re going to take [regulation] back.’” And so the states got together and did a much better job on that,” he said.

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Los Angeles attorney Richard Giller, who represents plaintiffs in lawsuits against insurers, said that the federal government could still take steps to improve the market.

Those might include establishing a federal reinsurance program that shares natural disaster risks with insurers, or covering the risk itself similarly to how the National Flood Insurance Program works.

“The catastrophe insurance industry in California is incredibly broken and needs some serious repair,” he said.

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Video: Skilled Foreign Workers Think About Leaving the U.S.

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Video: Skilled Foreign Workers Think About Leaving the U.S.

These highly skilled, highly educated foreign workers have been documenting the challenges of trying to build a career in the U.S. “If I don’t find a job, I have to leave the country.” “I sent out 907 applications.” “Have I ever truly relaxed in America?” They need an H-1B visa, which is given through a lottery system that allows U.S. companies to hire highly skilled international professionals for up to six years, in industries like tech and medicine. But the Trump administration has made changes to the program, requiring companies to pay a high fee and enforcing new rules that prioritize higher-paid foreign workers, in an effort to make more jobs available to Americans. This has forced some foreigners to rethink their career plans. “I think the U.S. is still the golden standard.” Wen-Hsing Huang came to the U.S. from Taiwan in 2022 for the tech scene, and was hired by Amazon on an H-1B visa. “I want to use my talents to change the world, and I think the United States was the best platform to do that.” Ananya Joshi came from India to attend a master’s program in Chicago in 2022. “So it was actually my my father’s dream that I had inherited because my father couldn’t go because of his financial situation.” Haina, a Chinese national, fell in love with the U.S. while studying in New York. She got her H-1B in 2022. “I remember there were a lot of companies, they would be able to sponsor.” Haina said she’s experienced a recent shift, where it has become harder to find companies that sponsor H-1B visas. “This time when I was job searching, I didn’t realize it could be a deal breaker. I just had my second interview of 2026, and it was a pretty short call.” (Recruiter) “I don’t think we’re eligible or able to do sponsorship for this role at the moment.” “They don’t even really get to know if I’m qualified, am I experienced, or anything. The decision is already made at that point.” “Please, please make sure that the company you’re about to work for has experience handling international hires.” Joshi said a start-up she interned with during grad school rescinded their promise to sponsor her H-1B visa. “Ask for everything in writing. And then there were jobs that were contract jobs. They would just reject me. They would only need people with a green card or a U.S. citizenship.” Even with an H-1B and a six-figure salary, Huang said he felt himself becoming anxious, as tech layoffs ramped up and Trump’s immigration policies kept changing. “I woke up every morning with this knot in my stomach, because my entire life depended on the policy I couldn’t control. The United States seems not very welcoming to immigrants that contribute to this country.” “The signals are, like, pretty clear at this point. They want to make this H-1B, is, like, risky and also, like, harder.” Hello, everyone.” Despite that, Haina says she’s determined to keep looking for a job until she’s forced to leave the country. “The pressure about where I’m going to be in the next of my career or, like, my life. I sort of like lost the ability to enjoy my life or just be happy.” “So I had to leave the U.S. Of course, I expanded my search beyond the U.S. Found a job in Germany.” Joshi packed up her life and started a new role with a European biotech firm in January. “I think I left at a good time, because there would have been more stress. I would have been stuck in a loop.” “It’s an endless cycle of anxiety.” After quitting his job at Amazon, Huang is now back in Taiwan, planning to launch his own company. “To bet on building an A.I. company that gives me complete control over my time, location and future. Staying in the United States is no longer the only way to achieve my American dream.”

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