In summary

Down the hall from where Gov. Gavin Newsom bragged about his balanced two-year budget proposal, California lawmakers went on a rapid-fire spree culling their colleagues’ pricey proposals.

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If you’re just a bill, sitting up on Sacramento’s “Capitol Hill,” the last place you want to be is on the Legislature’s dreaded “suspense file.”

Known as the most secretive and fast-paced biannual hearings, suspense file day is a bill-kill spree where the chairs of the Assembly and Senate appropriations committees quickly and quietly shelve legislative proposals in the name of cost-cutting. 

Often, the chairs are more ruthless during years of budget woes.

But despite a rosier budget picture from Gov. Gavin Newsom, delivered Thursday just down the hall from the appropriations hearings, lawmakers largely halted any new spending programs that didn’t have a way to self-fund. 

Both chambers killed about a quarter of the bills up for consideration — 90 of 332 in the Senate and 169 of 637 in the Assembly.

“We are working to fulfill our enduring promise to serve all Californians while acting with fiscal responsibility,” said Sen. Sabrina Cervantes, the new appropriations committee chair appointed this year by Senate President Pro Tem Monique Limón, in a statement after the hearing.

The suspense files are where the appropriations committees send bills that would cost the state at least $50,000 in the Senate and $150,000 in the Assembly. The process was originally a way for lawmakers to consider policy proposals that cost the state money together by balancing them against each other. 

But it’s also an opportunity for lawmakers to quietly kill controversial bills, appease powerful special interests without fanfare and reduce their workload. Lawmakers decide ahead of time, in secret, which bills to pass on to the other chamber and which to reject. The public hearings are a rapid-fire announcement of the decisions.

One measure axed would have given property tax breaks to low- and moderate-income households. Another would have established a special utility rate for data centers, which use so much water and electricity that they deplete supply and drive up prices for nearby communities. Still another unsuccessful measure would have provided tax credits to homeowners who “hardened” their homes against wildfires. 

An additional wildfire prevention measure would have instructed Cal Fire, the state’s wildland firefighting service, to prioritize vegetation management in areas where there are high concentrations of homeowners who rely on the state’s FAIR plan, or plan of last resort, for insurance. 

And the committee shelved a bill from Sen. Scott Wiener that would have exempted clean and renewable energy transmission projects from California’s landmark environmental review law. 

Like Newsom in the final budget presentation of his governorship, legislators blamed the state’s financial situation on Trump and federal decisions coming out of the Republican-controlled Congress.

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In the Assembly, a closely watched bill seeking to repeal a tax break for multinational companies was taken off the agenda before the hearing. It sought to roll back a law known as “water’s edge,” which allows multinational companies to avoid paying taxes on foreign income. The proposal, Assembly Bill 1790, is backed by unions and opposed by business groups.

Assembly Appropriations Chair Buffy Wicks said the proposal will be discussed as part of budget negotiations.

“I think a lot of stuff is going to shake out in the next month in terms of what the budget looks like, in terms of what is on the ballot,” Wicks said after the hearing.

It’s among a handful of proposals — including a ballot initiative to tax billionaires — to address the billions of dollars in federal funding the state is expected to lose next year.

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