California is home to the fourth-largest economy in the world, with a GDP of more than $4 trillion ranked only behind the United States itself, China and Germany.

The Golden State includes dozens of business sectors from manufacturing to agriculture and technology, and also handles billions of dollars worth of international trade every year.

Much of that product travels across the ocean, and passes through one of California’s ports.

But these trade patterns have been impacted by trade wars — and actual wars — which have led to increased consumer costs, fuel prices and route disruptions.

Dr. Noel Hacegaba is the President of the California Association of Port Authorities (CAPA), which represents 11 ports across the state, and the CEO of the Port of Long Beach. He spoke with Insight Host Vicki Gonzalez about how ports are navigating conditions to keep the wheels of commerce turning. 

This interview has been edited for length and clarity.

Interview highlights

Has California always been a center of commercial shipping? Has that grown over time? 

It has. If you look at California, and its proximity to Asia, it's the perfect gateway for trans-Pacific trade. In fact the vast majority of goods that enter the U.S. through California ports come from Asia. It's just the right place and offers so many advantages.

Over the decades California has become a juggernaut for global trade. When you take California's ports which range from Humboldt Bay in the north all the way to San Diego in the south, you've got a wide array of different entry points. Each port offers different advantages;  there are some that specialize in containerized ports like the Port of Long Beach, and then there are others that specialize in break-bulk, lumber, autos.

We have ports in our area — West Sacramento and Stockton, and then Oakland and Richmond a little farther out. What are the specialities of these facilities closer to home?

The ports that you just mentioned are important because when you consider the Central Valley in California, which is a major producer of agricultural product [that] is in high demand in places like Asia, those ports play a pivotal role in helping to get that product out.

Let's remember that exports are a major source of economic activity here in California and the United States. This is one of the reasons why California is the world's fourth-largest economy. It's because of its ports. and all the opportunities that they offer.

What kind of economic impact do the Golden State’s ports have?

When you take all the ports together you're looking at about 40% of the nation's waterborne imports, [and] about 30% of the nation's exports. We estimate that about a quarter of California's GDP is supported by California's ports, and you're talking about millions of jobs. Just to give you an example, the Port of Long Beach alone supports over a million jobs in California, almost three million jobs across the nation. That's about $300 billion worth of goods annually.

Does California have significant international competition?

When you look at some of the gateways to move product from Asia to North America, you do see Canadian ports investing aggressively in their infrastructure. Over the last three decades we have noticed rail connectivity between Canadian ports and destinations here in the United States. Mexico as well has invested billions of dollars in their infrastructure. This is why it's so important for our policymakers in Sacramento to remember how important ports are.

The historic Port and Freight Infrastructure Program that the Newsom administration, with California legislature support, authorized a couple of years ago — $1.2 billion — that was huge. We hope it's not a one-and-done deal. We hope that in the future California will continue to invest in its ports because when it does, it invests in its own economy. 

Shipping is also impacted by major events. Going back to COVID-19, I remember the major shipping backlogs. Has that traffic recovered since the pandemic?

The pandemic was a crisis that we had never seen. There was no playbook. Our dock workers [and] longshore workers, they masked up [and] showed up. We never had to shut down a single shift at the ports of LA and Long Beach. It's a testament to resilience. 

[During] the supply chain crisis, at the peak, there were 109 ships that were waiting to access the berths in San Pedro Bay. We cleared all that backlog. Today, because of what we learned and because we developed what I call the “resilience muscle,” we're handling more cargo today than we did at the peak of the pandemic with no backlogs, congestion or delays.

It's been six months since the war with Iran started. How has that impacted our ports?

We're seeing it in different ways. We are in a very different trade lane, so most of our trade is with Asia. Having said that, when you look at the impact on the energy market globally, you feel it because the nation's transportation sector is not immune. Fuel costs have surged since the beginning of the conflict. And when you consider that, that introduces a new cost that cascades across the supply chain.

From a volume standpoint, containers, we've noticed that many shippers, because of the uncertainty geopolitically, conflict, but also trade disruptions as a result of new tariffs and trade policy, they've employed a strategy that we call in the industry “frontloading” where they advance their shipments. It's a strategy where they try to get ahead of new tariffs [and] surging fuel costs. As a result of that we've actually seen an increase in our cargo volumes. In 2025 the Port of Long Beach set an all-time record, we handled 9.9 million TEUs [Twenty-Foot Equivalent Units]. For the first half of 2026 we're actually ahead of where we were last year.

Two weeks ago the Trump administration set a new round of international tariffs on dozens of countries that the U.S. trades with. How has the past year and a half been when focusing on the impacts that tariffs have had on ports? 

It certainly has been a source of disruption. The unpredictability has introduced an element of uncertainty in the supply chain that has made business planning, decision making and investment decisions a little more challenging. As a result, there have been a lot of surcharges that have been introduced into the national transportation system. 

But again, our ports here in California have demonstrated our ability to be a safe harbor in the sea of uncertainty. When you consider what's happening in the Middle East, what has emanated from that, the shock to the energy market and the resulting fuel costs, and when you consider where we are today from a trade policy standpoint, these 10% temporary tariffs were effectively replaced by another tariff in that same category. The American consumer continues to buy, the American supply chain continues to process all those containers and all that cargo, and it's a testament to that resilience muscle that we all developed during the pandemic. 

There’s concern and criticism of the emissions that come from California's port facilities, especially air pollution. What kind of changes have been made to help clean things up? 

Many. In fact California sports are the cleanest ports on the planet. At the ports of Long Beach and Los Angeles, guided by our Cleaner Action Plan, we have managed to reduce every category of emission to the tune of 98%. This has happened during the same time period that we saw our cargo volumes increase by over 40%. 

At the Port of Long Beach, I just launched a new vision for our port in January. We call it the 2050 vision. We're planning to double our container throughput to 20 million TEUs by 2050, and we're building the port of the future in the process. The port of the future is going to be faster, cleaner, more resilient, [and] safer.

California also has a goal to have all new cars and light trucks be zero emission by 2035. Do these ambitious climate goals conflict with how a port needs to operate?

There's no conflict at all. We aspire to become a zero-emission port much sooner than 2050. If the technology were available, if the financial resources were available, I think we can get there much faster. The 2050 goal has to do with the cargo throughput and cargo volumes. But when you look at California’s ports we’re all chasing the same goal. We're all trying to become more efficient, more competitive, safer, more secure, and cleaner as well.

At the end of the day, does this mean ports need to go electric? Or are there other sources of clean power? 

When you look at how we're leading the transition to carbon-free energy sources, in Long Beach for example, most of that transition is electric. That's the low-hanging fruit. But we're also exploring offshore wind. We're still looking at electric microgrids. We're looking at hydrogen fuel stations. We just announced the $1 million methanol challenge where we're encouraging the shipping industry to adopt methanol bunkering within our port.

And then just a couple of weeks ago I was in Washington D.C. signing a first-of-its-kind memorandum of cooperation with the U.S. Maritime Administration to explore the adoption of a small nuclear reactor within the port environment. These small modular reactors are the latest form of carbon-free energy that we think could have potential application in the maritime environment.

A new bill, AB 1777, aims to hold ports, warehouses, and other places accountable for their pollution by authorizing the California Air Resources Board to adopt regulations to reduce or mitigate emissions from indirect sources of pollution. Your association is against AB 1777. Why?

We have demonstrated an ability to move the needle when it comes to decarbonization and reducing emissions on a voluntary basis. There is a role and a place for regulation. Directionally, there is alignment between where the regulations are headed, where we as ports want to head. But when you look at the practice, the implementation, the adoption, it requires a whole constellation of factors to get us there and get us there faster. We're talking about a system of systems that comprises different industries and sectors that each require investments [and] equipment. 

What we have learned in Long Beach is cooperation is what will get us there faster. The groundbreaking Green Port Policy that launched back in 2005, that evolved into the Cleaner Action Plan between the San Pedro Bay ports. We have demonstrated that you can grow green; you can grow your volumes and you can reduce emissions. We did that voluntarily. 

It's when we collaborate, it's when we offer incentives, it's when we learn to support each other across different industries and sectors that we can get there faster. 

There's also a big push to revitalize shipbuilding in the country, from Congress as well as plans by the controversial group California Forever in Solano County. Are the state’s ports supportive of these efforts?

When you look at the economic engine that is California’s ports, anything that will spur more economic activity, create more good-paying jobs, we support. When you look at what's happening in the world, the disruptions brought on by geopolitical instability, it just makes sense for there to be energy diversification, energy independence… and the same applies to all the equipment that we need to run these ports, whether they’re cranes or ships. 

But the key is we have to have a transition plan. It can't happen overnight. And I think the stars may be aligning so that some of that manufacturing can come back to the U.S. We'd love to host it here in California. I think it's a perfect place to have U.S. shipbuilding and crane manufacturing. We welcome that opportunity.

In the final few weeks of his last legislative session as California governor, Gavin Newsom is asking lawmakers to help reduce how much profit-making utility companies must pay out after wildfires. 

His administration has for weeks floated to lawmakers a wide-ranging but still-vague package of bills to address the spiraling costs of wildfires that has made a slew of different interests unhappy. 

Insurance companies have launched an ad campaign against what they call a potential “utility bailout,” that would leave them unable to recover from the power companies the costs of paying homeowners’ insurance claims. Attorneys representing fire survivors and other plaintiffs that sue utilities don’t want to see their fees reduced. 

Wildfire survivors worry the governor’s proposal would prevent them from being made financially whole for suffering trauma. Local government leaders are demanding that they continue to be paid the full cost to rebuild incinerated infrastructure. 

On the other side are the politically influential utilities, who have drawn fury for their equipment sparking several of the state’s most devastating wildfires. 

The state’s three investor-owned utilities, Pacific Gas & Electric, Southern California Edison and San Diego Gas and Electric, aren’t in imminent financial danger and last year saw profits rise. But fire costs have contributed to Californians paying the second-highest electricity rates in the country, and lawmakers and Newsom’s office worry that if it becomes harder for utilities to borrow money those bills will continue to climb. The utilities together provide power for about three-quarters of the state.

Newsom and the lawmakers say utilities are held responsible for too much after a wildfire and that bad actors like hedge funds are taking advantage to get a cut. If another devastating wildfire triggers damages too high for a utility to pay, the potentially resulting bankruptcy would make it even harder for victims to collect.

“The status quo doesn’t work,” Newsom said at a press conference last week when asked whether his proposal is in the best interests of fire survivors. “And we’re trying to balance all of those needs in a very familiar process that will unfold over the course of the next few months.”

As he mulls a presidential run, Newsom has political incentive to push through a deal. Opponents from the right are eager to paint California as unaffordable and lurching through disasters; further rate hikes or the specter of a utility bankruptcy wouldn’t help. But backing the utilities also comes with risks: Anger at the companies remains fresh after Edison was last week found by Cal Fire and the Los Angeles County Fire Department to be responsible for the January 2025 Eaton Fire that killed 19 people in Altadena. 

The chair of a key Assembly committee, Democratic Assemblymember Cottie Petrie-Norris, is generally on board with Newsom’s proposals, but lawmakers in the Senate appear less certain. Fire survivors are urging them to slow down and commit to a more public debate.

“You cannot be ‘there are some bad actors’ and therefore we will have a secret bill,” said Joy Chen, who leads a group of Los Angeles wildfire survivors. “Then your bill is the bad actor.”

A familiar fight

It’s a redux of a bitter fight that has bookended Newsom’s time as governor. 

He stepped into his role in the wake of devastating wildfires that tore through Northern California in 2017 and 2018, several of which PG&E was found to have been responsible for. 

The utility was in a bind: Under California law it was strictly liable for fires that were getting more severe, partly due to climate change, and regulators were no longer letting the companies pass damages onto customers in cases where they were found careless.

Facing mounting suits from victims and insurance companies, the company in 2019 declared bankruptcy. Newsom quickly signed legislation to help buffer utilities from those claims, drawing accusations of a bailout. The state created a $21 billion wildfire fund, paid for half by utility shareholders and half by customers through a $2.50 surcharge on their monthly electricity bills, to pay victims’ claims, provided the utilities follow stricter safety regulations. 

Then in January 2025, during an intense windstorm, electricity arcing from a century-old out-of-service Edison tower in Southern California’s Eaton Canyon set dry brush ablaze. The resulting Eaton Fire, burning at the same time as the deadly Palisades Fire, claimed 19 lives and nearly 9,500 homes and other buildings. UCLA estimated losses at between $24 billion and 45 billion.

The state wildfire fund is expected to be drained once the costs of insurance claims, Edison’s multimillion-dollar voluntary settlements with survivors and numerous unsettled lawsuits are tallied. (Lawmakers extended the fund last year to address future fires, adding to electricity customers’ surcharges through 2045.) Profiteering hedge funds have sought to take advantage by buying up insurance claims. 

Newsom’s goal is twofold: Limit who can make claims to the fund and limit how much they can get. In private briefings last week and a document outlining his package released Tuesday, his office said he would combine the cost reductions with bills to boost home hardening, help homeowners get off the state’s insurer-of-last-resort and re-enter the home insurance market, tie utility executive pay to safety and require shareholders to pay down customers’ rates for two summers. 

Details of the package remain scant. The outline released Tuesday did not include proposed legislative language.

CalMatters contacted the state’s three major utility companies. San Diego Gas & Electric did not respond. PG&E and Edison referred questions to Nathan Click, spokesperson for the utilities’ campaign, which is called Wildfire Victims First and has been blanketing the state with ads telling Californians to urge their lawmakers to act.

Click, who is also a political spokesperson for Newsom, did not answer specific questions, including whether utilities are meeting directly with lawmakers. Instead, he shared statements from a handful of business groups and a powerful electrical workers’ union urging lawmakers to advocate for the proposed liability reduction.

In addition, the chief executives of PG&E and Edison have said they plan to take action to protect their shareholders if California lawmakers do not pass legislation to limit their fire liability. They did not specify what they planned to do.

Over the past four years PG&E, Edison and SDG&E collectively spent $5.2 million on California political campaigns, sponsored travel for lawmakers and donations to officials’ favored charities, according to CalMatters’ Digital Democracy database. 

PG&E also has the fifth-highest spending on lobbying in the 2025-2026 legislative session and was the top spender from April through June. In the first half of this year, the three utilities reported spending nearly $7 million to influence Newsom’s administration, the Legislature and their regulators at the California Public Utilities Commission.

Limiting damages

Newsom suggests chipping away at utilities’ liabilities by limiting attorneys’ fees, reducing the amount of money local governments can recoup to rebuild burned infrastructure and curbing how much some victims can receive in damages.

His proposal would set up a state-administered “fast pay” program to prioritize wildfire fund payouts for survivors whose loved ones are killed, who are injured or whose properties are destroyed. To participate, claimants would likely need to give up their right to sue the utility — trading an often lengthy wait through litigation to get comprehensive damages in exchange for the relief of a quicker payout. 

For other victims “in harm’s way,” the Tuesday outline suggests allowing up to $150,000 in damages. 

Newsom’s office and Petrie-Norris, who generally supports the idea, said they do not intend to limit emotional distress claims for survivors they deem legitimate but those kinds of damages should be curbed for others. 

“If you were part of a disaster no one’s going to say you can’t make a claim,” Petrie-Norris, an Irvine Democrat who chairs the Assembly utilities committee, said. “If you did not actually experience a disaster, what non-economic damages should you be entitled to?”

Petrie-Norris and Newsom are concerned about billboard attorneys who seek clients to file lawsuits against utilities and the wildfire fund; one study has found attorneys are likely to get 30% to 40% of victims’ payouts. Groups representing survivors and attorneys argue it’s not so clear who should count as a victim. Residents who lost no property and stayed in their homes miles away could still be harmed by smoke inhalation, for example. 

Chen said she was “stunned” after she was briefed by the governor’s office last week and was told that only people who are evacuated and have their house burn down would be eligible for non-economic damages.

“Let’s say someone was out of town, but their house burned down so they didn’t evacuate,” she said. “But they lost everything, so they have to rebuild. So you won’t compensate them for pain and suffering?”  

Newsom also wants to stop investors from buying claims and prioritize small business claimants over corporations, but his office has not explained how to accomplish that. 

The proposed bill package has so incensed some wildfire victims that opponents of the plan have shrugged at arguments that some claimants are taking advantage of the Wildfire Fund. 

“The utilities are finding a lot of creative ways to avoid responsibility. That’s it,” said Graham Knaus, chief executive of the California Association of Counties. “We should not be opening the door for them to escape accountability.”

Shifting costs

Another component of the outline released Tuesday could affect homeowners across the state. Newsom is proposing to limit — or eliminate entirely — insurance companies’ right to recoup money from utilities when a utility-caused fire forces those insurers to pay out homeowners’ claims. 

The process is known as subrogation. The two powerful industries have been at odds over it for years.

Utilities and insurance already clashed in 2018 when utilities unsuccessfully backed a bill to loosen a unique California legal doctrine that holds power providers strictly liable for wildfire damages near their equipment even if they aren’t found responsible for the fire. 

“We’re a well-resourced industry, but not like (the utilities),” Rex Frazier, president of the Personal Insurance Federation of California, recalled. “Their lobbying spend was just crazy.”

Denni Ritter, vice president for the American Property Casualty Insurance Association, said eliminating subrogation could impede the progress that has been made due to the regulations California adopted last year to address insurance availability problems. 

“We’re at this precarious time,” Ritter said. Because the state now allows insurance companies to consider catastrophe modeling and reinsurance costs in pricing their premiums, some insurers have resumed writing new policies in California, and the number of policies in the last-resort FAIR Plan is growing at a slower rate, according to the state insurance department.

But if they can’t recover the costs of wildfire claims, Frazier and Ritter said insurance companies will raise premiums, which would affect homeowners even in areas with low fire risk.

“We don’t understand how they’re not embarrassed to suggest that the answer to their problem is to shift their costs over to other people,” Frazier said. “Why should a homeowners insurance customer in a dense urban environment have to pay considerably more?”

Sen. Ben Allen, the Democratic chair of the Senate utilities committee and a candidate for insurance commissioner, said he doesn’t want to make that tradeoff if the package doesn’t include other benefits for consumers or taxpayers. 

Petrie-Norris said it could be worth it. 

“If I can save you $2 on your utility bill and your insurance bill goes up by $1, that seems like a smart thing for us all to do,” she said. “But we’ve got to make sure that’s true and whether there are unintended consequences.”

Jeremia Kimelman and Digital Democracy engineer Andrew Chan contributed to this story.

By BARBARA ORTUTAY, AP Technology Writer

OAKLAND, Calif. (AP) — Jury selection began Wednesday in Meta's federal trial over claims its platforms have harmed youth mental health and also track children in violation of federal law.

The trial scheduled to begin next week is expected to last six to eight weeks. Meta faces 29 states in the federal multidistrict lawsuit filed in 2023, but the Oakland trial will only include the first four — California, Colorado, Kentucky and New Jersey.

Eight states, including Tennessee where a trial is ongoing, filed lawsuits in their own state courts.

The 2023 lawsuit, filed in federal court in Oakland, California, claims that Meta routinely collects data on children under 13 without their parents’ consent, in violation of federal law.

“Meta has harnessed powerful and unprecedented technologies to entice, engage, and ultimately ensnare youth and teens. Its motive is profit, and in seeking to maximize its financial gains, Meta has repeatedly misled the public about the substantial dangers of its social media platforms,” the complaint says. “It has concealed the ways in which these platforms exploit and manipulate its most vulnerable consumers: teenagers and children.”

Judge Yvonne Gonzalez Rogers asked prospective jurors about their own social media activity, knowledge about other lawsuits Meta faces, and any strong feelings they may have about social media companies and their role regarding the allegations.

The trial is the latest in an avalanche of lawsuits against Meta Platforms and other social media companies including Google's YouTube, TikTok and Snap, over claims their platforms harm young people, illegally collect their data and are deliberately designed to addict them.

Last week, a New Mexico court ordered Meta to pay $567 million to address harms to young people from its platforms in the second phase of a landmark trial.

The penalty is in addition to the $375 million in civil penalties that jurors ordered against Meta in March after determining the company knowingly harmed children’s mental health and concealed what it knew about child sexual exploitation on its platforms.

In the second phase, prosecutors asked the judge to impose fundamental changes at Meta aimed at reining in addictive features, improving age verification and preventing child sexual exploitation through default privacy settings and closer oversight.

The states are seeking heavy penalties and changes to the way Meta operates its platforms to make them safer for children. Meta has repeatedly said it has introduced dozens of features to do so. It is appealing the New Mexico decision.

“We strongly disagree with these allegations and are confident the evidence will show our longstanding commitment to supporting young people,” the Menlo Park, California, tech giant said in a statement. “We’ve listened to parents, worked with experts and law enforcement, and conducted in-depth research to understand the issues that matter most. We’re proud of the progress we’ve made, and we’re always working to do better.”

By Diana Lambert, EdSource

Last week, Sacramento City Unified leaders thought they had solved the district’s financial problems with a plan to save $158 million, in part by dipping into retiree health benefits, to stave off bankruptcy.

That plan fell through Monday when state Superintendent Tony Thurmond denied an appeal by the district after the Sacramento County Office of Education rejected an agreement between the district and its teachers union. The plan would have used $67 million in retiree health benefits, $22 million in Medi-Cal reimbursements and $6 million worth of unfilled vacancies to backfill its general fund.

Now, the district of 41,868 students will have to find other ways to increase its cash flow before it runs out of money and is forced into state receivership, which a state expert says could happen by early April.

Despite the denial, Thurmond criticized the Sacramento County Office of Education in a letter for rejecting the district’s plan, which he said would have improved its ability to meet its financial obligations. Thurmond also threatened to assume oversight of Sacramento City Unified’s finances if the county office does not help it improve its bottom line.

“The CDE is concerned that this action by SCOE is not effective in resolving SCUSD’s financial problems,” Thurmond wrote. “I call on both parties to continue their deliberations regarding the best path forward toward fiscal solvency for SCUSD.”

The fiscal plan

The agreement between the teachers union and the district also would have extended the Sacramento City Teachers Association contract to June 2030 and added a provision that would guarantee teachers received the same raises given to all other bargaining units in the district. 

The agreement is part of a fiscal sustainability plan that would “enhance the district’s financial standing by $158.6 million,” according to a board resolution approving it on July 30.

Los Angeles Unified approved a similar plan to draw money from a fund for retiree benefits. As part of a fiscal stabilization plan approved in June, the district drew $175 million from a post-employment account to avoid drastic cuts to its Black Student Achievement Plan for the 2028-29 school year.

Luz Cázares, a fiscal advisor appointed by the Sacramento County Office of Education, or SCOE, to oversee the district’s finances in December, had rejected the agreement between the teachers union and the district on July 31. The agreement, she said, would only delay the district’s impending insolvency, cost more over time and make it more difficult for the district to make a sustainable long-term fiscal recovery.

The denial

“The district is currently spending beyond its means and must identify the programs and services they are going to reduce or eliminate,” according to a statement on the county office website. 

Several additional actions taken by the board to solve their budget crises were also “problematic,” according to the statement.

Both Sacramento County Superintendent David Gordon and Michael Fine, the chief executive officer of the state Fiscal Crisis and Management Assistance Team, or FCMAT, agreed with Cázares’ decision to reject the agreement, according to the county office.

A Sacramento City Unified school board resolution to appeal the decision on Aug. 4 said the county’s decision relied on faulty logic and would prohibit the district from achieving fiscal solvency.

The letters

The denial from Thurmond came in two letters sent to Sacramento City Unified Superintendent Cancy McArn and Gordon, the county superintendent, Monday evening. One denied the appeal and one criticized the county office for denying the fiscal plan.

The letters came after at least two days of discussions between district and county officials mediated by Thurmond. 

Thurmond called the meetings “a productive first step” in a Friday email to EdSource.

It’s not clear why Thurmond denied the appeal if he thought the County Office of Education was incorrect in its assessment of the district’s financial choices, but some education experts say he wouldn’t have been able to act to overturn the SCOE decision alone. 

Fine said Monday he wasn’t even sure if the decision could be appealed. If it was, it would have to be with agreement from Linda Darling-Hammond, president of the State Board of Education, or the executive director of the board, he said.

Unions exerts pressure

There was considerable pressure to overturn the county office decision. With its 310,000 members, the California Teachers Association threw its substantial political clout behind Sacramento City Unified and the Sacramento City Teachers Association.

“Your office has the clear authority and responsibility to review and reverse county fiscal decisions, conduct budget appeals and take necessary actions (on) school district efforts to maintain local control in response to county office of education ineffectiveness, particularly when such actions will enable a school district to avoid insolvency and avoid unnecessary and potentially onerous state loans,” said CTA President David Goldberg in the letter. 

Thurmond also received almost identical letters from the San Diego Education Association, United Teachers Los Angeles and the Oakland Education Association.

Money problems

Sacramento City Unified faces a structural deficit of approximately $221.8 million, according to the Sacramento County Office of Education. 

The district needs about $81.2 million to remain solvent, Fine said.

“Cash flow is my biggest concern because the bottom line, if you can’t balance payroll checks, instruction stops, and we have a mutual constitutional obligation, I believe, to ensure that there’s a continuity of instruction,” Fine said.

If Sacramento City Unified can’t come up with the money it needs to pay its bills, it will have to request help from the state Legislature by early January, as it takes about 90 days for state lawmakers to pass a bill relinquishing the funds, Fine said.

If the district takes an emergency loan from the state, the members of the school board would be stripped of their decision-making authority and would become advisors to a state or county-appointed administrator. The superintendent is often fired immediately.

Despite the dire prognosis, Fine said there is still time for the district to avoid receivership.

“You’ve got to identify things that you can really act on right away,” Fine said. “Every day that goes by that you’re not acting on them, the dollars … you’re going to use to offset this get smaller and smaller.”

Sacramento City Unified has had a history of fiscal problems that date back to at least 2017, when the district averted a strike by agreeing to increase teacher salaries 7.5% for most teachers and 11% for those with mid-range salaries. 

Although the pay increases aren’t the only reason for the district’s money problems, many observers consider the 2017 agreement to be the tipping point.

Federal Covid funding boosted the district’s bottom line a few years, but when it ended, the district again began to grapple with deficits, Fine said.

In 2025-26 the district was in negative certification, meaning it was not able to meet its financial obligations that year or the next. A FCMAT report from 2025 found weaknesses in budget monitoring, including under budgeting for personnel, special education expenses, supplies and operating expenses.

A statewide issue

Sacramento City Unified isn’t the only California school district struggling to keep itself financially afloat. In May, Pleasanton Unified, Antioch Unified, San Ysidro Elementary and Weed Union Elementary joined Sacramento City Unified on the state’s list of districts that could not meet their financial obligations over two school years.

Since 1990, six districts — Vallejo City Unified, Oakland Unified, West Fresno Elementary School District, Emery Unified, Compton Unified and West Contra Costa Unified — have been in receivership, but were able to pay off their loans and have control returned to their school boards.

Three other districts — Plumas Unified, Inglewood Unified and South Monterey County Joint Union High School District — are in state receivership.

In Sacramento County, the only other brush with bankruptcy was when Natomas Unified had to cut $10 million from its budget or face a state takeover in 2011. The district hired an interim superintendent who had experience bringing districts back to fiscal health and avoided bankruptcy.

Mallika Seshadri contributed to this report.

By Carlos Cabrera-Lomelí and Ella Jackson of KQED

Thinking about buying or leasing an electric car in the near future? California will soon be making that cheaper.

On Friday, Gov. Gavin Newsom launched “MyFirstEV,” a new state program that sets aside millions of dollars to fund rebates for residents who buy or lease a zero-emission vehicle — a category that includes battery-electric cars and hydrogen fuel cell-powered vehicles.

First-time EV buyers can qualify for a $3,500 discount when buying or leasing a new electric vehicle, as long as the retail price is under $50,000. If you’re looking for a used electric car, there’s still a price reduction available — a smaller one, however: $1,750 off for vehicles retailing for under $25,000.

The state’s program comes a year after President Donald Trump’s massive spending and tax plan known as the One Big Beautiful Bill ended federal tax credits for EVs nationwide. Previously, American consumers could claim a $7,500 tax credit after buying a new EV or $4,000 for used EVs.

When announcing the program in July, Newsom said that as the federal government pulls back from supporting EVs, California would instead be “putting its foot on the accelerator” — and that the instant rebate program would “[make] it easier for families to drive clean, breathe clean and keep more money in their pockets.”

The program has secured $270 million in funding — half of that from the state budget and the other from participating EV automakers. 

Who qualifies for new EV rebate?

Only California residents who are buying or leasing an EV for the first time are eligible for this rebate.

And consumers will have to confirm that this is the first time they are buying or leasing an EV before taking their car home, said Lindsay Buckley, communications director of the California Air Resources Board, the agency tasked with managing the program.

“Participants will be required to sign a legal document declaring that this is in fact their first purchase or lease of an electric vehicle,” she said.

“So if you’ve already bought or leased an electric vehicle in the past, then you wouldn’t be eligible for this program.”

Limiting the program to first-time buyers could actually help boost the popularity of EVs among people who have never bought them, said Scott Moura, a UC Berkeley professor of civil engineering.

“Providing incentive to people who have bought EVs before isn’t really adding to the number of people who purchase EVs,” he said. “The funds can be used most effectively if they’re targeted towards first-time EV buyers.”

Do you need to apply ahead of time?

No — there’s no application to fill out ahead of time. All you need to do is go to a dealership of one of the 15 participating automakers. 

Hyundai, Lucid and Tesla rebates are available starting today. The other participants will launch their programs throughout the fall.

This is different from other past state rebate programs — like the now-terminated Electric Bicycle Incentive Program — which have required participants to fill out an application before making a purchase.

If you move forward with making a purchase or lease, confirm two things with the salesperson and the financing team:

• That you qualify for the MyFirstEV discount
• That there are still state funds available for this specific car brand.

When federal EV rebates were available, buyers had to initially wait until they filed their taxes the year after buying their car to request this money back. But state officials say that folks interested in the FirstEV discount won’t have to wait so long.

“Californians will be able to go down to participating automakers’ dealerships and access the rebates at the point of sale,” Buckley said. “They won’t have any delay in getting this discount.”

Can I get a rebate for any EV I want?

No — MyFirstEV discounts will only cover battery-electric cars and hydrogen fuel cell-powered vehicles from automakers participating in the program.

Hybrid vehicles are also not included in MyFirstEV, state officials confirmed with KQED. 

There’s also a price limit: The EV you choose must cost under $50,000 if it’s a new car, and $25,000 if it’s used.

There is, however, a small exception to this price rule if the automaker is headquartered in California — in which case the discounts will apply regardless of the manufacturer’s retail price.

More than a dozen electric car brands are based in the Golden State, with several selling models priced beyond the $50,000 limit.

Can low-income buyers get additional support?

While the MyFirstEV discount will not vary based on income, consumers can stack the discount with other incentive programs, including the Driving Clean Assistance Program and Clean Cars 4 All.

To qualify for Clean Cars 4 All, residents must have an income of less than or equal to 300% of the federal poverty level. This program could unlock up to $12,000 in additional savings. 

Will some carmakers have more rebates than others?

No — funds will be divided equally among the participating automakers.

However, there may be greater demand for some brands, which could mean that rebates may run out faster at some dealerships.

This article includes reporting from KQED’s Laura Klivans.

By KELVIN CHAN and BARBARA ORTUTAY, AP Business Writers

Meta Platforms CEO Mark Zuckerberg laid out a vision Monday of what he said artificial intelligence can do for the world, imagining a future where everyone has their own, all-knowing AI agent that strives to improve all aspects of their lives.

Zuckerberg detailed his ambitions for the technology in a 6,500-word essay published online where he also outlined why he favors open-source AI technology, in which developers make key components accessible for anyone to examine, modify and build upon.

In a document derided by critics as fantastical, Zuckerberg said his company is working toward an era where everyone will have the tools to create new businesses, receive Ph.D.-level tutoring and provide personalized lifestyle tips. His 8-year-old daughter, he wrote, can already code her ideas and quickly produce videos.

“Everyone will soon have invention superpowers,” Zuckerberg wrote.

Zuckerberg warned of risks if control of advanced AI is concentrated with a select few companies, institutions or governments. On Monday, Meta also announced the release a new open-source AI model, Muse Glimmer, which can run on a personal computer, and Zuckerberg said the company would also would provide a way for developers to access a more powerful AI model, Muse Spark 1.2.

Meta makes AI models, like several other tech companies, and uses them to power platforms such as Instagram and Facebook. The Menlo Park, California, company also makes them available to developers who can create their own apps and features.

Skeptics urge a slower pace of AI development

Critics said Zuckerberg was not reckoning fully with the risks inherent in AI's rapid development.

Noting recent incidents where AI models, including Meta’s own, hacked other companies on at least three separate occasions, Anthony Aguirre, president and CEO of the AI safety nonprofit Future of Life Institute, asked “what on Earth makes Meta think they — or anyone — could control something exponentially smarter, faster, and more capable?"

“Meta’s chosen path is ultimately one of human replacement and disempowerment, but there is an alternate, pro-human path -- one that brings about individual flourishing and scientific breakthroughs with controllable AI tools. What’s urgently needed now is for governments to facilitate a pause on advanced AI development and steer us onto the pro-human path — before it's too late,” Aguirre said.

Meta chief says AI should be broadly distributed

In his essay, Zuckerberg outlined why he thought open source is a better path for fair development of AI. He warned that if control of AI “superintelligence” is too concentrated, it will lead to less favorable outcomes for everyone else. The key, he wrote, is finding a balance that ensures advanced AI is “broadly distributed" to empower billions of people equitably.

Meta has long been a proponent of open-sourcing its AI models, but has struggled to keep up with rivals such as OpenAI, Anthropic and Google that have not taken the same approach.

Zuckerberg made what could be a veiled reference to Meta's rivals without naming specific companies.

“Most other labs are focused on building AI for companies, governments, or other institutions, so if those labs lead, then the balance of power will favor larger institutions over individuals,” he wrote.

Zuckerberg also included policy recommendations for keeping the U.S. ahead of rivals, including China. The United States and its allies need to speed up building energy capacity and infrastructure to stay competitive, he said.

Zuckerberg called for authorities to reconsider their position on “ distillation,” which involves training a less capable model on the outputs of a stronger one. The Trump administration has vowed to crack down on Chinese AI companies using distillation to extract technical features from U.S. AI models. Anthropic earlier this year accused China's DeepSeek of using distillation.

"Some have tried to frame distillation as harmful, but I think it is important to protect the principle that you can learn from anything you can observe," Zuckerberg said. “This is how the world works, and the U.S. will not be able to lead if we restrict ourselves on this front.”

Critics see a self-serving message from Meta

Matt Lane, senior policy counsel at the nonprofit digital rights advocacy group Fight for the Future, called Zuckerberg “annoyingly out of touch on his best day,” but said the CEO is right about the importance of open-source AI.

Shared access to open-source AI systems is important for protection in a world where AI can be used to hack into electronic systems, like voting systems and benefits infrastructure, he said.

But he said only Meta will benefit if everyone were to use Meta-designed AI systems, even if they are fully open-source. "Open source AI needs to be supported beyond these corporate interests. We, unlike Zuckerberg, hope for as much competition as possible,” he said.