Uber strikes a deal with California lawmakers

from Levi Sumagasai, Marissa Kendall, Kristen Huang and Yue Stella YuCalMatters

This story was originally published by CalMatters. Sign up for their newsletters.

State leaders are in heated negotiations with special interests behind several key measures ahead of Thursday’s deadline to withdraw them from the November ballot. Top Democrats have already announced a deal between Uber and state attorneys general to drop rival initiatives that each has spent tens of millions of dollars promoting.

It’s a dance that happens every election cycle: Interest groups seeking policy changes spend heavily on voter initiatives, using them as leverage in exchange for bargains from state leaders, who often prefer to compromise to reject controversial proposals rather than take chances with voters.

Legislative leaders can also place measures on the ballot. By Monday, they had already agreed on an affordable housing bond. They are also expected to approve a proposal to increase the cap on deposits in the government’s rainy day fund by Thursday.

Here are the highlights:

Uber deal, trial lawyers

Uber and California’s legal lawyers likely avoided a costly battle before the November election by going through the state legislature instead of voters.

Uber had gathered enough signatures for a ballot initiative that would have a cap on attorneys’ fees for contingencies and limit how much California crash victims can recover for medical expenses — and not just those injured while riding in Uber. Advocacy groups had qualified a competing initiative to increase the company’s liability for sexual misconduct against riders and drivers.

The company and lawyers reached a compromise in Senate Bill 623which would limit medical reimbursement in cases involving medical liens, allowing accident victims to receive medical treatment without paying up front while their case is pending. It would not limit attorneys’ fees in emergency situations, as Uber proposed in its ballot measure, which critics say would make it harder for crash victims to get legal representation. It will be limited to accidents that occur with Uber or another ride-hailing service.

The legislation would also prohibit lawyers from recommending medical professionals with whom they have direct relationships.

Meanwhile, Uber will have to tighten its driver background checks and renew them every year, including rejecting drivers who have been convicted of certain violent crimes or those found guilty of driving under the influence within the past seven years.

A group of medical providers that have spent money against Uber’s initiative did not return multiple requests for comment on the deal. Likewise, the Consumer Attorneys of California, which has raised about $77 million for its initiative — nearly as much as the $78 million Uber has given to its campaign — also declined to comment beyond the statement they agreed to with the company.

It reads in part: “This agreement protects patients from unnecessary treatment or overcharging, ensures access to medical care and legal representation, and strengthens safety measures.”

Consumer advocacy group Consumer Watchdog also opposed Uber’s ballot measure, but said the deal “strikes a fair balance.”

The bill “doesn’t hurt the average Uber driver (who has health insurance),” Jamie Court, the group’s president, told CalMatters.

If lawmakers pass the bill and send it to the governor, it would take effect next year.

Affordable Housing Bond

A record $11.25 billion available housing bond appears headed for the California ballot this November.

The governor, assembly and senate agreed on the language of Senate Bill 417known as the Veterans Affordable Housing Bond Act of 2026, which would have Californians borrow $10 billion to pay for the construction, rehabilitation, acquisition and preservation of affordable housing, plus another $1.25 billion to help veterans buy homes.

If approved by voters, the bond should help more than 40,000 people buy a home, help create or preserve tens of thousands of affordable units and support high-paying construction jobs, according to the Newsom administration.

“California’s future depends on whether people can afford to put down roots, raise a family and build a life here,” the governor said in news release.

A recent report found that nearly 40,000 planned affordable housing units in California are ready for construction, but are remained pending funding.

The bond is not officially a done deal. The Legislature still has until Thursday to pass the bill, and the governor must sign it before the housing bond can appear on your ballot.

What is happening to the billionaire tax?

The state’s largest health care workers’ union appears poised to raise its high profile a tax on the billionaire’s wealth to voters despite Newsom’s late-hour efforts to strike a deal to remove him from the ballot.

The United Healthcare Workers West has proposed a one-time 5 percent wealth tax on the state’s roughly 200 billionaires. If approved by voters, the tax would generate roughly $100 billion primarily for health care with some money reserved for schools and nutrition programs, according to SEIU-UHW.

The union says the money is needed to offset federal health care cuts that forced California to cut it Medi-Cal health insurance program for low-income residents and people with disabilities.

Newsom, who has emerged as an early opponent of the tax, has steadily stepped up pressure on the union over the past week, joining forces with other unions like the California Teachers Association and health centers like Planned Parenthood and the California Medical Association, which have released digital ads against the tax. Silicon Valley billionaires and tycoons also oppose the tax, which they say would reduce state revenue in the long term by driving wealthy Californians out of the state.

Last week, SEIU-UHW urged Newsom to adopt a 2 percent version of the tax instead of the original 5 percent, but Newsom quickly rejected that proposal, calling it “poorly designed.”

In a recent interview with The leverSEIU-UHW President Dave Regan said Newsom could “pull a rabbit out of a hat” to reach a compromise, but he had his doubts. “We are ready to move forward and will be on the ballot in November.”

Reform of the rainy day fund

Lawmakers are expected to vote this week to send a proposed constitutional amendment to voters to increase how much money the state can save in a good fiscal year.

Currently, the state cannot deposit more than 10% of its general fund tax revenue into its rainy day fund. Newsom and lawmakers have been considering raising that cap for years.

The proposal comes as California faces a multiyear budget deficit despite rising revenues, prompting state lawmakers and Newsom to seek long-term solutions to stabilize the state’s finances. California is heavily dependent on the income and capital gains tax of its wealthy residents, making the state vulnerable to economic downturns.

This article was originally published on CalMatters and is republished under Creative Commons Attribution-NonCommercial-No Derivatives license.