HomeMy WebLinkAbout05 2026 LEGISLATIVE UPDATE
Agenda Item_______
Reviewed:
AGENDA REPORT
City Manager_______
Finance Director_______
MEETING DATE:JANUARY 20, 2026
TO:HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM:ALDO E. SCHINDLER, CITY MANAGER
SUBJECT:2026 LEGISLATIVEUPDATE
SUMMARY:
Recap of 2025 Legislative activities by the City’s advocacy consultant Townsend Public
Affairs, consideration of the 2026 Legislative Platform, and updates on legislative activity
at the state and federal level.
RECOMMENDATION:
Recommend City Council take the following actions:
1.Adopt the 2026 Legislative Platform; and
2.Receive and file the legislative update prepared by Townsend Public Affairs.
FISCAL IMPACT:
There is no fiscal impact associated with this item.
CORRELATION TO THE STRATEGIC PLAN:
The Legislative Update contributes to the fulfillment of the City’s Strategic Plan Goal D:
Strong Community and Regional Relationships. Specifically, this item implements Strategy
3, which is to ensure strong advocacy and regional leadership.
BACKGROUND AND DISCUSSION:
2026 Legislative Platform
Each year, the City of Tustin prepares a Legislative Platform that istoaccomplish the
following:
Provide direction to the City’s legislative delegation on priorities, projects, and
principles of the City Council
City Council AgendaReport
2026 Legislative Update
January 20, 2026
Page 2
Allows staff and Townsend Public Affairs to identify priority bills being discussed in
Sacramento and Washington, D.C. to create a targeted outreach plan
Allows staff and Townsend Public Affairs to act quickly on priority issues being
discussed in Sacramento and Washington, D.C.
The Legislative Platform includes guiding principles that give broad direction to staff and
Townsend Public Affairs when considering legislative issues to:
Preserve Local Control
Promote Fiscal Stability
Support Funding Opportunities
The Legislative Platform also includes more specific statements in various policy areas
such as:
Local Governance
Economic Development
Land Use Planning and Housing
Parks and Recreation
Public Works
Water Quality and Water Supply
Human Resources and Risk Management
Public Safety
Each City department was given time to review and recommend modifications to the
draft Legislative Platform prior to the City Council’s consideration.
Adoption of the Legislative Platform does not mean that staff and Townsend Public
Affairs will focus solely on bills or issues that fall within the Legislative Platform, nor
does it mean that Townsend Public Affairs will not continually seek the City’s input or
positions on specific legislation. Staff and Townsend Public Affairs will continue to keep
the City Council appraised of legislation and proposals (whether specifically addressed
by the Legislative Platform or not), and Townsend Public Affairs will continue to seek
input from the City as legislation of legislative proposals are discussed. The draft 2026
Legislative Platform is included as Attachment 1.
Legislative Update
Townsend Public Affairs has created a summary of state and federal legislative activity
for the month of December 2025, which is included as Attachment 2.
City Council AgendaReport
2026 Legislative Update
January 20, 2026
Page 3
_____________________
Aldo E. Schindler,
City Manager
Attachments:
1. Draft 2026 Legislative Platform
2. Townsend Public Affairs – November 2025 Legislative Monthly Report
ATTACHMENT 1
CITY OFTUSTIN
2026LEGISLATIVE PLATFORM
The Mayor and City Manager are authorized to submit advocacy letters on behalf of the
City if the proposed legislation, regulation, or state budget spending directive clearly
follow the City’s adopted legislative platform.
PURPOSE
The City of Tustin’s 2026Legislative Platform confirms the City Council’s position on
current issues with the potential to directly or indirectly impact the City, thereby
establishing guidelines to actively pursue pending legislation through monitoring and
communications activities. Below are the Guiding Principles and Policy Statements that
will allow City staff to address 2026legislative,regulatory, and state budget issues in a
timely manner, without precluding the consideration of additional issues that may arise
during the legislative session.
GUIDING PRINCIPLES
I.PRESERVE LOCAL CONTROL
Preserve and protect the City’s powers, duties,and prerogatives to enact local
legislation and policy direction concerning local affairs and oppose legislation that
preempts local authority. Local agencies should preserve authority and
accountability for land use planning, revenues raised and services provided.
II.PROMOTE FISCAL STABILITY
Support measures that promote fiscal stability, predictability, and financial
independence, and preserve the City’s revenue base and maximum local control
over local government budgeting. Oppose measures that shift local funds to the
County, State,or Federal Governments and/or make cities more dependent on the
County, State,or Federal Governments for financial stability, such as unfunded
mandates or mandated costs with no guarantee of local reimbursement or
offsetting benefits.
III.SUPPORT FUNDING OPPORTUNITIES
Support opportunities that allow the City to compete for its fair share of regional,
state,and federal funding. Support funding for programs including, but not limited
to,economic development such as infrastructure investment and housing,
transportation projects including road resurfacing, bicycle and pedestrian safety,
multi-modal transportation systems and transit-oriented development, air quality,
water quality,and local water reliability, parks and recreation, historic preservation,
natural resources, hazard mitigation, public safety, public healthand disaster
recovery.
POLICY STATEMENTS
Local Governanceand Finance
1.Support local government action, rather than the imposition of state, federal or
regional mandates upon local governments, as well as federal mandates placed
on the state.
2.Support maximum flexibility for local government in contracting and contract
negotiations.
3.Support the implementation of additional flexibilities governing open government
initiatives including provisionsof the Ralph M. Brown Act.
4.Support legislation that facilitates the flexibility of local governmentsto share
resources to increase efficiencies and decrease costs.
5.Support legislation that preserves the ability oflocal governments to determine the
appropriate type of election and representation for their jurisdiction.
6.Support the reimbursement of local governments for disasterand funding lapse
related expenses, including the need for essential public safety service overtime,
personal protective equipment, public health response and small business relief.
7.Support legislation that maintains local discretion and authority over transfer taxes
and other locally approved revenue measures, opposing any state efforts to
preempt, delay, or undermine their implementation.
8.Support legislation that affirms cities must retain the fiscal autonomy necessary to
fund essential community services, infrastructure, and housing initiatives approved
by their voters.
9.Support and monitor efforts to increase the City’s ability to recover payment related
fees from customers.
10.Oppose state or federal efforts to “borrow” local revenues and encourage the state
to find other methods of balancing its budget.
11.Oppose policies that would increase the voter threshold for local revenue measures
or would increase the potential for litigation over local taxes and fees.
12.Oppose efforts to further erode local control over permitting and enforcement of
street vending.
13.Oppose and monitor efforts to increase City contribution costs to CalPERS.
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Economic Development
14.Support international, statewide, regional,and local efforts to attract, retain and
provide resources for current and future commercial and industrial businesses.
15.Support policies and programs that encourage working with other cities, counties
and government agencies to jointly leverage resources and assets to create and
strengthen economic clusters within the region.
16.Support economic development initiatives that preserve and enhance a positive
business climate and maintain and grow the business tax base.
17.Support policies and initiatives that will facilitate development of City owned
property, including Tustin Legacyand Pacific Center East. Oppose policies and
initiatives that run counter.
Land Use Planning and Housing
18.Support efforts to provide flexibility to local governments as well as resources for
local governments to allow them to submit compliant housing elementsand
execute actionable programs and policies.
19.Support funding and policy modifications that require additional staffing resources
be deployed by the State of California Department of Housing and Community
Development (HCD)to ensure uniformity within the housing element compliance
and review process.
20.Support policies and regulations that require additional transparency and local
stakeholder input within the Regional Housing Needs Allocation(RHNA) process.
21.Support housing measures that promote the development and enhancement of
safe, affordable housing and accessible housing within the City for all economic
segments of the population, while retaining local control.
22.Support funding and policy measures to reduce the occurrence of homelessness
and improve resources for immediate rehousing when needed.
23.Support local control over the licensure and regulation of residential recovery
facilities, parolee homes, sober living homes, and other group accommodations in
residential areas, while respecting disabled persons’ right to housing.
24.Support proposals that provide funding or tools to preserve historic neighborhoods
and structures.
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25.Support legislation, proposals, or regulations that helps cities achieve their housing
element requirements and provides benefits for those that are fully compliant.
26.Support all efforts to create efficiencies within the California Environmental Quality
Act (CEQA), including benefits to streamline the development of mixed-use infill
projects that support transit and housing.
27.Oppose legislation that would erode local control over City owned property,
including Tustin Legacy and Pacific Center East.
28.Oppose proposals that increase requirements and place undue burdens on the
City with regard to the Surplus Land Act.
29.Oppose efforts that require the City to ministerially approvehousing development
projects without adequate input from local agencies or a robust public engagement
process.
30.Oppose legislation, proposals, or regulations that impose regional, state, or federal
growth development or land use planning standards within the City without the
City’s direct input.
31.Oppose legislation or proposals that take away non-housing related revenues from
cities for Housing Element or RHNA non-compliance.
32.Monitor local, state, and federal actions related to medical and recreational
marijuana regulatory changes.
Parks and Recreation
33.Support continued state funding for local art, cultural, and music programs.
34.Support the creation and preservation of high-quality parks and facilities, as well
as affordable, innovative, and inclusive recreation programs.
35.Support the inclusion of per-capita grants to cities and counties within statewide
park bond measures.
36.Support efforts that strengthen policies to fund parks, open space acquisitions,
bike lanes, and active transportation opportunities.
37.Support efforts to increase funding, accessibility and programs for seniors.
38.Promote local agency control over policies that recognize the benefits of parks and
recreation facilities.
Public Works
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39.Support increased state and federal funding of transportation improvements with
regional or sub-regional benefits for all modes of transportation.
40.Support protection of dedicated transportation-related tax revenues and enhance
the ability of local agencies to finance local transportation programs and facilities.
41.Support Federal, State, County and local programs to increase funding and
simplify permitting for transit, bicycling, and pedestrian travel.
42.Support legislation that allows local governments to continue to retain full authority
to reject projects or to condition project approvals and impose mitigation measures.
43.Support efforts to facilitate public-private partnerships to complete development
projects.
44.Support efforts that fund broadband infrastructure.
45.Support efforts that assist the City in meeting its waste and recycling mandates
and adding flexibility to comply with state regulations.
46.Support coordinated planning, design, and delivery of public works and
transportation projects through strong collaboration among local governments,
transportation agencies, and utility providers to ensure efficient implementation,
minimize project conflicts, and maximize community and regional mobility benefits.
47.Support dedicated, ongoing state funding for MS4 permit compliance, stormwater
capture, pollution prevention, and watershed management programs.
48.Oppose efforts to remove City representation on regional boards that oversee
water, drainage and/or sewage.
49.Oppose new stormwater mandates or enforcement actions unless accompanied
by a sustainable funding mechanism for local agencies.
Water Quality and Water Supply
50.Support and monitor legislation that increasesthe availability of, and funding for,
water conservation, water reuse technologies, water recycling, local water storage
and other water supply technologies such as the Groundwater Replenishment
System project.
51.Support the enhancement of a reliable and sustainable water supply for California
as well as measures that improve water quality in the region.
52.Support policy development, funding and research for water conservation,
addressing urban runoff and beach closures and required programs associated
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with Orange CountyNational Pollutant Discharge Elimination System (NPDES)
permits.
53.Support funding for PFAS treatment systems, groundwater well rehabilitation,
interconnections, and local water reliability improvements.
54.Support efforts to address long term water resiliency and affordability without
implementing a statewide water tax.
55.Support legislation that preserves local discretion in the assessment, collection
and usage of development fees for projects, including but not limited to, water,
wastewater, transportation, and other critical infrastructure needs.
56.Oppose efforts that restrict or eliminate local permitting and enforcement of water
quality measures.
57.Oppose efforts that unilaterally reduces the indoor water use standards without the
input of local and regional stakeholders.
58.Monitor the development of a state framework for long-term water conservation
measures.
Human Resources and Risk Management
59.Support pension reform measures designed to (i) control or decrease employer
liability,or (ii) increase transparency in reporting,without imposing undue
hardships or administrative burdens on local government.
60.Support policy and regulatory reforms to liability insurance to protect the function
of local governments from unforeseen risk circumstances.
61.Support workers’ compensation-related legislative measures which positively
affect public employers.
62.Support legislative and regulatory reforms that reduce unfunded liability costs
and mitigate the financial exposure of public agencies resulting from excessive
litigation, statutory penalties, or outdated liability frameworks.
63.Oppose redundant or unnecessary proposals(legislation or policies)that require
excessive human resources burdens without sufficient reimbursement, such as
numerous annual reports to the state on a variety of topics.
64.Oppose measures that reduce local control over employee relations issues or
mandate new or enhanced local government employee benefits.
Public Safety
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65.Support measures that encourage community safety and well-being including
those which support state and federal reimbursement of homeland security related
expenses.
66.Support initiatives involving county, state, and federal governments to reduce and
prevent homelessness in Orange County.
67.Support measures that provide funding and local resources for wildfire fire
prevention, suppression, and mitigation.
68.Support local control over adult entertainment facilities, alcohol establishments
and properties where illegal drugs are sold.
69.Support local control for the regulation of cultivation, storage, manufacture,
transport and use of medicinaland recreational marijuana and monitor legislative
and administration activity to create a regulatory structure for medical and adult
use.
70.Support legislation increasing resources and local authority for abatement of public
vandalism, especially graffiti.
71.Support Federal, State, County or local efforts to develop programs, partnerships
or grants programs to assist cities in providing housing solutions and/or services
to address homelessness.
72.Support regional and state proposals to increase funding and regional
collaboration for locally operated homeless shelters.
73.Support efforts that add de-energization to the conditions that constitute a state
and local emergency.
74.Support legislation that deters the distribution, sales, and consumption of
controlled substances.
75.Support the continuation of Cal OES emergency preparedness funding for cities
and counties to provide organized staffing during incidents.
76.Support efforts that assist law enforcement in the rehabilitation of formerly
incarcerated individuals.
77.Support funding efforts for identified programs that improve public safety’s mental
health and wellness, and resources that provide regular mental health and
wellness checks for public safety personnel.
78.Oppose legislation that places burdensome restrictions on law enforcement and
limits their ability to protect public safety.
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79.Oppose efforts to limit the City’s ability to enforce parking rules and regulations
and recover the costs of implementationand maintenance.
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MEMORANDUM
To: City of Tustin
From: Townsend Public Affairs
Date: December 1, 2025
Subject: November 2025 Legislative Monthly Report
STATE UPDATES
November 2025 Recap
Activity at the Capitol remained relatively limited as the Legislature continued its interim recess,
focusing primarily on district-based responsibilities and constituent outreach. With formal
legislative business paused, most statewide attention centered on the November 4 special
election, during which voters approved Proposition 50. The measure shifts responsibility for
drawing congressional district boundaries from the independent redistricting commission to the
Legislature through 2030, affirming the redistricting framework previously enacted in AB 604
(Aguiar-Curry/Gonzalez, 2025). Immediately following its approval, Proposition 50 became the
focus of two federal lawsuits that contest the legality of the Legislature’s role in drawing the new
congressional maps.
On the Executive Branch front, Governor Newsom traveled to the United Nations Climate Change
Conference to participate in scheduled events and meetings. His attendance included discussions
with international delegates, presentations on California’s climate policies, and participation in
forums related to global emissions and clean-energy initiatives.
Meanwhile, activity intensified around the emerging 2026 governor’s race; with Governor Newsom
term-limited, attention is turning to a widening field of potential successors. Candidates vying to
succeed Governor Newsom have been facilitating statewide conversations about housing,
affordability, education, and infrastructure.
Statewide political attention will continue to intensify as the gubernatorial campaign moves into a
more active phase, with candidates increasing public appearances, policy rollouts, and
fundraising efforts. Several other statewide and legislative races are also progressing, with
campaigns beginning to solidify their messaging and organizational structures ahead of the 2026
election cycle.
While major legislative action will remain limited during the recess, December is poised to be a
month of heightened political positioning as candidates and policymakers prepare for a busy
election year and the return to formal legislative activity.
California’s Proposition 50 Maps at the Center of Expanding Federal Litigation
State Capitol Office 925 L Street • Suite 1404 • Sacramento, CA 95814 • Phone (916) 447-4086 • Fax (916) 244-0209
Federal Office 600 Pennsylvania Avenue SE • Suite 360 • Washington, DC 20003 • Phone (202) 546-8696 • Fax (202) 546-4555
Southern California Office 1401 Dove Street • Suite 430 • Newport Beach, CA 92660 • Phone (949) 399-9050 • Fax (949) 476-8215
Northern California Office 300 Frank H. Ogawa Plaza • Suite 204 • Oakland, CA 94612 • Phone (510) 835-9050 • Fax (510) 835-9030
Central California Office 744 P Street • Suite 308 • Fresno, CA 93721
The statewide special election on November 4 resulted in voter approval of Proposition 50;
however, the measure has since become the subject of two separate federal lawsuits that could
significantly affect its implementation for the 2026–2030 election cycles. With Proposition 50’s
passage, California is positioned to advance new congressional districts pursuant to the
provisions enacted in AB 604 (Aguiar-Curry/Gonzalez, 2025).
California’s new congressional map is now facing parallel legal challenges that question its
validity. The actions, filed independently by the U.S. Department of Justice and the California
Republican Party, argue that the Legislature relied too heavily on racial data when drawing the
new districts.
The first lawsuit was filed on November 5 by Assemblymember David Tangipa, the California
Republican Party, and several individual plaintiffs in the U.S. District Court for the Central District
of California, naming Governor Newsom and Secretary of State Shirley Weber as defendants.
The plaintiffs argue that the Legislature engaged in an unauthorized mid-decade redistricting,
contrary to state constitutional limits that allow redistricting only once per census cycle. They
further contend that race was used as a predominant factor in the map-drawing process, citing an
expansion of Latino-majority or “Voting Rights Act” districts without what they view as adequate
legal justification. The lawsuit asks the court to declare Proposition 50 unconstitutional and
reinstate the prior congressional district map before the 2026 election cycle.
A second lawsuit, filed on November 13 by the U.S. Department of Justice, mirrors and broadens
many of these challenges. The DOJ argues that the newly adopted map relies too heavily on
racial demographics, particularly in its treatment of Hispanic voters, in ways that may violate the
Equal Protection Clause and the Voting Rights Act. While the DOJ’s challenge follows the
Republican Party’s lawsuit, it signals heightened federal scrutiny of California’s redistricting
process and increases the potential legal exposure facing the State.
Together, the lawsuits introduce substantial legal and political uncertainty for the proposed
changes to California’s congressional landscape. From a legal standpoint, the cases will test the
boundaries of permissible consideration of race in the redistricting process and clarify whether
Proposition 50 permits the mid-cycle replacement of district lines. Politically, the outcomes could
affect the competitiveness of several congressional districts and may influence how states
approach both racial and partisan considerations when redrawing maps in future cycles.
Both cases are pending, and no timeline has been set for resolution. Until the courts determine
the fate of Proposition 50 and the resulting congressional map, the State’s redistricting framework
and the districts that will be used in upcoming elections remain uncertain.
LAO Releases Fiscal Outlook for 2026-27
On November 19, the Legislative Analyst’s Office (LAO) released its annual Fiscal Outlook for the
State’s 2026-27 budget cycle, offering an independent assessment of California’s budget
condition for the coming fiscal year along with multi-year projections of revenues, expenditures,
and structural balance. As always, the analysis reflects existing state and federal policies and
does not anticipate future actions by the Administration, Legislature, or federal government.
Despite stronger personal income tax collections, the LAO now projects an $18 billion budget
deficit, which is larger than previously expected.
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Recent state revenues have strengthened, driven largely by stock-market gains linked to AI-
related growth in the tech sector. However, the LAO cautions that these trends may not be
sustainable and notes parallels to the dot-com bubble. Moreover, the recent revenue boost does
not improve the State’s bottom line because constitutionally required increases in Prop 98 school
funding and Prop 2 debt payments absorb most of the gains. Additional cost pressures across
Medi-Cal, CalFresh, pensions, and corrections further widen the shortfall.
Beginning in 2027-28, the State is projected to face ongoing structural deficits of roughly $35
billion per year as expenditure growth continues to outpace revenues, major cost increases
associated with HR 1 are phased in, and one-time solutions expire. After three consecutive years
of shortfalls, California’s reserves have declined to approximately $14 billion, and most temporary
measures have already been exhausted, leaving the State less prepared for an economic
downturn.
The Governor’s January budget will provide updated economic and revenue assumptions
produced by the Department of Finance, but the LAO advises the Legislature to prioritize ongoing
solutions rather than temporary fixes. They recommend treating any unexpected revenue gains
as one-time in nature and directing them toward rebuilding reserves or reducing budgetary debt
rather than expanding ongoing program commitments.
LAO Releases Overview of HR 1 and Its Implications for CalFresh
On November 13, the Legislative Analyst’s Office (LAO) released an assessment of the federal
HR 1, the One Big Beautiful Bill Act, outlining its anticipated impacts on CalFresh. The analysis
highlights significant changes to program eligibility, benefit levels, and state and county
administrative costs.
CalFresh, the State’s implementation of the federal Supplemental Nutrition Assistance Program
(SNAP), provides monthly food benefits to low-income individuals and families to help them
purchase groceries. Benefits are distributed via an electronic benefits card and play a central role
in addressing food insecurity and supporting basic nutritional needs across the State.
According to the LAO, HR 1 proposes broad revisions to federal nutrition programs that are
expected to reduce CalFresh participation and benefit amounts. A major component of the bill is
the expansion of work requirements for Able-Bodied Adults Without Dependents. HR 1 would
increase the age range subject to time-limited benefits, narrow several existing exemptions, and
impose more stringent standards for waivers based on local economic conditions. Collectively,
these changes could render a substantial share of current recipients ineligible. The measure also
reduces eligibility for certain immigrant groups, which the LAO estimates would remove tens of
thousands of Californians from federally funded food assistance.
Beyond eligibility changes, HR 1 includes provisions that would lower benefits for many
households. The bill places restrictions on how the federal Thrifty Food Plan can be updated–
limiting future increases in maximum benefits – and curtails California’s ability to use its Standard
Utility Allowance, which currently raises benefits for many recipients. It also eliminates federal
nutrition education funding starting in October 2025. These changes are projected to result in
widespread reductions in monthly support and, for some households, the complete loss of
assistance.
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HR 1 also shifts additional financial responsibility from the federal government to states and
counties. Beginning in 2027, states with payment error rates above newly imposed thresholds
would be required to cover a share of benefit costs. Based on recent performance, California
could potentially be responsible for an estimated $2 billion in annual CalFresh benefit payments
unless error rates improve. Administrative costs are also expected to rise in 2026 when the federal
reimbursement rate decreases, increasing state and county obligations for program operations.
To support preparation for these potential changes, the enacted 2025–26 state budget includes
funding for system updates, county implementation efforts, payment error reduction strategies,
and resources for food banks. The LAO notes that the ultimate impact of HR 1 will depend on
forthcoming federal guidance and the timelines for implementing the new requirements.
California Supreme Court Reverses Precedent on Police Complaint Procedures
On November 10, the California Supreme Court invalidated Penal Code section 148.6, a 1995
law that made it a misdemeanor to knowingly file a false complaint against a police officer. The
Court concluded that, although preventing intentionally false allegations is a valid state interest,
the statute’s required warning to complainants created a meaningful risk of discouraging people
from reporting potential misconduct.
The law required individuals to sign a notice acknowledging potential criminal penalties before a
complaint could be submitted. The Court found that this process, administered by law-
enforcement personnel and enforced by the same agency receiving the complaint, could deter
even good-faith complainants and therefore placed an unconstitutional burden on protected
speech. The decision also cited statewide findings, including repeated recommendations from the
Racial and Identity Profiling Advisory Board, that the advisory requirement could discourage
individuals from coming forward with legitimate concerns.
The ruling overturns the Court’s own 2002 precedent upholding the statute, rendering section
148.6 unenforceable going forward. Law-enforcement agencies will no longer administer the
advisory or apply the related misdemeanor provision, and the decision is expected to prompt
updates to complaint-intake procedures across the state.
Department of the Interior to Open Offshore Drilling Leases in California
On November 20, the Department of Interior (Interior) announced a Secretary’s Order to reopen
the National Outer Continental Shelf Oil and Gas Leasing Program after it was limited under the
Biden Administration. The leases, to be granted before October 2026, would include at least six
zones on the West Coast, including near California, and allow for the exploration, siting,
construction, and operation of new offshore drilling platforms. The 60-day notice on the order
requires a public comment period, which is expected to open by early December.
Despite new leases being issued in other parts of the country, California has not seen new drilling
platforms constructed since the 1980s, largely due to public opposition and tourism and fishery-
dependent economies noting the negative impacts of a potential spill. Governor Gavin Newsom
has since announced his opposition to the Department of Interior’s proposal.
The State has robust environmental protection laws, including the California Environmental
Quality Act (CEQA), the California Coastal Sanctuary law, and the California Coastal Act, which
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could at least delay construction or incentivize oil and gas companies to prioritize other sites not
in California.
FEDERAL UPDATES
LEGISLATIVE BRANCH ACTIVITY
The federal government shutdown officially
Senate Democrats agreed to vote with Republicans to pass a modified version of the House-
HR 5371, with an end date of January 30, 2026
then passed the measure, returning to Washington
19, followed by the President signing the resolution that evening.
In exchange, Democrats were assured a December floor vote in the Senate to extend the
Affordable Care Act (ACA) health insurance premium subsidies set to expire at the end of the
year, the reversal of layoffs of federal workers during the shutdown, and a temporary prohibition
on further layoffs until January 30, 2026
refused
continuing resolution were three of the
twelve-year appropriations bills intended to jumpstart a return to the normal process
of funding the government.
The three full-year appropriations bills
-FDA, Military Construction
Nutrition A
extensions
included in HR 1, the One Big Beautiful Bill Act, and authorities for certain telehealth, prescription,
and health center programs that expired at the end of Fiscal Year 2025 on September 30.
Congress Makes Further Movement Towards Finalizing Appropriations Process
The Senate moved towards finalizing the Fiscal Year (FY) 2026 appropriations process in
November, releasing its versions of the Energy and Water and Financial Services and General
Government bills. Congress has until January 30, 2026 to pass the nine remaining full-year
appropriations bills and avert another, albeit partial, government shutdown.
Senators are also reported to be planning a larger minibus of five appropriations bills, though
House Appropriations Committee Chairman Tom Cole has expressed skepticism at the House’s
willingness to pass a minibus of that size. The nine remaining bills include the majority of
discretionary spending and earmarks, notably including the Transportation, Housing and Urban
Development (THUD); Commerce, Justice, Science (CJS); Labor, Health and Human Services,
Education (LHHS); and Defense packages currently being negotiated between the House and
Senate. The House bills are generally in line with the President’s skinny budget request and its
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appendixreleased earlier this year, while the Senate bills are generally bipartisan and maintain
or only slightly modify current spending levels.
Congress is also considering a full-year continuing resolution (CR) for any bills they are unable to
negotiate before the January 30, 2026, deadline, though appropriators have made it clear that
this is a last resort. deadline, though appropriators have made it clear that this is a last resort. The
first two weeks of session in December will likely be consumed by attempts to pass a health care
package before December 12, as Senate Democrats were promised a vote on health insurance
premiums in order to end the government shutdown. That leaves one week of session in
December and three in January before the deadline. It generally takes committee staff six weeks
to compose floor-ready bills from a final agreement on topline numbers. With the holidays, it may
take additional time, leaving the House and Senate on a tight timeline to resolve the differences
between their funding bills and avert a second shutdown.
Congress Readies Health Care Package for December Vote
As healthcare premiums could drastically increase at the end of the yearAs healthcare premiums
could drastically increase, Republicans in Congress have felt pressure to propose an alternative
to the Affordable Care Act (ACA) health insurance premium subsidies. . Senator Bill Cassidy (R-
LA) has proposed shifting the subsidy amount into individual Health Savings Accounts (HSAs)
and subsidy recipients into lower-tier higher-deductible health plans, while Rep. Brian Fitzpatrick
(R-PA) has floated a compromise extension of the subsidies with new income limitations and
additional flexibilities for HSAs. Senator Rick Scott (R-FL) released his own plan, creating a
modified form of HSAs called Trump Health Freedom Accounts that could be used to pay both
premiums and deductibles, along with the introduction of a state waiver program.
The competition between these plans, along with the President’s short-lived proposal to extend
the health insurance premium subsidies with additional limitations on eligibility, will likely consume
Congress’s schedule for the first two weeks of December, as the self-imposed deadline for action
is December 12.the legislature for the first two weeks of December, as the self-imposed deadline
for action is December 12.
House Committee on Natural Resources Advances Permitting Reform Bill
On November 20, The House Committee on Natural Resources held a markup of a number of
bills, including HR 4776, the Standardizing Permitting and Expediting Economic Development
(SPEED) Act, which was passed out of committee on a bipartisan basis. The bill represents the
most significant reforms to federal environmental permitting in years and would notably create
parity between California Environmental Quality Act (CEQA) reviews and National Environmental
Policy Act (NEPA) reviews.
This means a completed CEQA review, since California has higher environmental standards,
could satisfy the requirements of NEPA for certain federally funded projects. This would save
developers and local jurisdictions significant time and resources in building housing and other
infrastructure using federal dollars.
Natural Resources Chairman Bruce Westerman has expressed optimism the bill will see a floor
vote by the end of the year, though potential passage will likely be pushed into 2026.
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EXECUTIVE BRANCH ACTIVITY
Department of Government Efficiency is Mostly Disbanded
A November 24 report indicated that the Department of Government Efficiency Service (DOGE)
had largely been disbanded despite eight months remaining in its mandate, established by
Executive Orders 14158 and 14222. DOGE was a reorganization of the United States Digital
Service (USDS), which was previously created to help integrate modern technology into federal
government systems. Tesla CEO Elon Musk initially led DOGE and oversaw mass firings of
federal employees, as well as the cancellation of federal contracts and grant awards.
DOGE gained notoriety with Elon Musk at the helm, and claims to have saved taxpayers $214
billion, though this figure has been previously disputed. The Service has sought to cancel large
numbers of federal contracts and grant awards, conduct mass reductions in force leading to the
effective closure of the US Agency for International Development (USAID) and Consumer
Financial Protection Bureau (CFPB), and cancel hundreds of federal office leases across the
country. Its work also led to large amounts of federal grant funding being frozen under review for
compliance with Administration priorities.
DOGE’s efforts culminated in HR 4, a rescissions package de-obligating funding previously
appropriated by Congress on a bipartisan basis for the Corporation for Public Broadcasting (which
in part funds PBS and NPR) and USAID. Office of Management and Budget (OMB) Director Russ
Vought continued these efforts with proposed pocket rescissions for additional foreign aid
spending, though the Government Accountability Office found the tactic to be illegal. The
agreement to reopen the government at least temporarily reversed the rescissions.
as a centralized entity, which follows previous reporting that remaining staff had been transitioned
to political appointee roles at their respective agencies. Though the USDS and DOGE social
has stated the Office of Personnel Management
(OPM) and the OMB are now responsible for executing DOGE’s mandate.
HUD Releases New Continuum of Care Funding Opportunity with New Structure for
Permanent Supportive Housing
On November 13, the Department of Housing and Urban Development (HUD) released a new
Notice of Funding Opportunity (NOFO) for the FY25 Continuum of Care (CoC) Competition and
Youth Homeless Demonstration Program Grants (YHDP), which fundamentally restructures the
CoC competition and types of projects that will be funded. The NOFO intentionally rebalances the
portfolio toward transitional housing and Supportive Services Only projects and conditions a much
larger share of funding on enforcement-oriented approaches.
The most consequential change is a 30% cap on the amount of annual renewal demand (ARD)
funding available for permanent supportive housing (PSH). Previously, 90% of funding was
allocated for PSH, and CoC’s operating PSH programs in that 90% were classified as Tier 1 and
considered part of the ARD, providing strong protection to existing projects.
Impacts on California
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Overall,inCalifornia, the revised NOFO is anticipatedto cost leave the state with a $410 million
gap in funding for CoCs and could cause nearly 27,000 individuals to lose their housing. Currently,
30% of permanent housing beds in California are funded by CoC, including 34% of PSH. On
November 25, Governor Gavin Newsom announced a lawsuit seeking to protect the program.
Nationwide, these changes are expected to have significant impacts on the estimated 170,000
PSH recipients, who are individuals with severe disabilities, mental illness, and chronic health
conditions that rely on the CoC funding for housing. HUD CoC is generally designed to quickly
rehouse homeless individuals, families, persons fleeing domestic violence, dating violence,
sexual assault, and stalking, and youth while minimizing the trauma and dislocation caused by
homelessness. Since January, the Administration has sought to change the federal government’s
posture towards homelessness. The NOFO is seen as complying with Executive Order (EO)
14321, titled Ending Crime and Disorder on America's Streets, which directed the Secretary of
Health and Human Services (HHS) and the HUD Secretary to end support for housing first
policies.
The Administration is instead emphasizing temporary supportive housing with work or treatment
requirements for a general maximum of 24 months, a major shift from the housing first model that
has generally defined federal government support over the last decade. At the end of October, a
group of Republicans in Congress circulated a draft letter advocating for a one-year clean
extension of the program, allowing more time for the Administration to develop its policy. Senate
Democrats responded to the NOFO release with their own letter.
Food Assistance/SNAP Benefits Delayed by Government Shutdown, Now Administered
Resulting from the federal government shutdown, the Department of Agriculture’s (USDA) Food
and Nutrition Service (FNS), which administers the Supplemental Nutrition Assistance Program
(SNAP/CalFresh), notified state administrators in late October that they would not have funding
available for benefits payments in November 2025. Citing the imminent exhaustion of prior-year
funds, the Administration directed contractors and FNS not to accept the state data required to
This was controversial due to the existence of a contingency fund in Title IV of HR 4366, the last
full-year appropriations bill enacted by Congress, which continued through FY25 (October 30,
2025). The Administration argued that ongoing benefits payments was not a permissible use of
the fund. On October 31, two federal judges issued orders contradicting the Administration’s
argument, requiring they at least partially fund benefits for the month of November. On November
3, the Department of Justice (DOJ) and USDA filed in one of the cases stating that they would
make the funding accessible by November 5 as required, though due to the size of the
contingency fund they would only be able to provide 50% of the benefit amount for November.
They provided further procedural details in a separate filing in the other case, and during a hearing
stated that DOJ did not intend to appeal the decision, despite a statement by the President to the
contrary that was later rescinded.
On November 6, the judge in one of the cases ruled the Administration had to provide 100% of
benefits payments for November and utilize additional funding. DOJ and the USDA appealed the
decision, though on November 7 USDA sent an update to state administrators that they will make
full benefits available in accordance with the November 6 court order.
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The federal government shutdown ended on November 12, and the majority of benefits have been
paid, though they were delayed due to the significant administrative burden on states and
contractors to supply the information required to administer them.
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