A Powerful Union, The Billionaire Tax And An Alleged Bargaining Chip

SACRAMENTO — As nan designer of a one-time taxation connected California billionaires, Dave Regan says he’s pushing nan measurement to raise $100 cardinal to protect low-income patients, workers and hospitals from President Trump’s cuts to healthcare.

The behind-the-scenes negotiations pinch Gov. Gavin Newsom’s agency successful June to propulsion nan measurement disconnected nan ballot, however, revealed different imaginable goal, according to 2 sources acquainted pinch nan talks who requested anonymity to stock specifications of nan discussions pinch The Times.

Regan, nan president of SEIU-United Healthcare Workers West, asked for national contracts pinch 2 hospitals successful San Diego and Fresno and a session successful Imperial County, among a database of sweeping demands to turn his union, successful speech for rescinding nan measure, nan sources said.

The national leader denied that he asked for concessions for his national successful speech for removing nan billionaire taxation from nan ballot, calling nan allegations “categorically false.”

“We are trying to lick a problem,” Regan said. “The problem is to forestall a catastrophe successful California’s healthcare system. We put guardant a proposal. Nobody other has offered a solution, and nary of what you are referencing happened.”

The talks grounded to consequence successful a woody and nan measurement will look arsenic Proposition 40 connected nan November ballot, leaving California voters to determine pivotal taxation argumentation that has roiled nan Democratic Party and opponents interest could yet trim gross for nan authorities budget.

The position Regan allegedly laid retired raise nan mobility of whether he intended for nan billionaire taxation to spell connected nan ballot, aliases if it was designed arsenic a leverage play to grow his union, which represents much than 120,000 workers and is among nan largest healthcare unions successful nan nation.

Regan, who has been elected to 5 consecutive position arsenic national president since 2011, has a grounds of launching ballot initiatives astatine nan authorities and section level to usage arsenic leverage for national description and to thwart his governmental opponents.

His foes opportunity that this twelvemonth he went excessively far.

“It’s nary concealed successful Sacramento that nan ballot inaugural has been utilized this measurement by UHW arsenic a weapon,” said Francisco Silva, president of nan California Primary Care Assn., which represents organization clinics. “They’ve been very vocal astir it and we deliberation it’s a bigger consequence to nan information nett than immoderate use that it brings.”

Known arsenic a stubborn negotiator and a brash personality, Regan has revenge aggregate ballot initiatives against nan healthcare industry.

His opponents opportunity his strategy centers connected launching initiatives that would wounded employers, which forces them to travel to nan array to negotiate. Regan’s national past requests national contracts aliases different concessions that could pave nan measurement for a corporate bargaining agreement. If employers resist, nan inaugural advances to nan ballot. Voters consistently cull his measures, but companies still walk millions of dollars campaigning against them.

Over nan years, Regan has projected aggregate measures that would person constricted charges and executive salaries astatine hospitals and dropped nan initiatives after landing impermanent deals pinch nan California Hospital Assn. that could thief his union’s organizing efforts.

This year, UHW agreed to telephone disconnected an inaugural to again headdress compensation for infirmary leaders, and nan infirmary relation rescinded its dueling connection to require nan national to activity support from its members to walk much than $1 cardinal connected a statewide ballot measurement campaign.

Regan led and mislaid measures against nan dialysis manufacture successful 2018, 2020 and 2022 arsenic he struggled to unit dialysis companies to admit his national and discuss a contract.

Silva accused Regan of utilizing nan aforesaid playbook successful negotiations astir different measurement connected nan November ballot, Proposition 44, which would restrict spending astatine nonprofit organization wellness clinics.

Regan drafted Proposition 44 to require that organization clinics walk 90% of gross connected diligent services, which he said ensures that money is aligned pinch nan ngo of nan wellness centers. But Silva said nan measurement dramatically reduces backing for different basal services successful nan organization attraction model, specified arsenic organization outreach, education, overhead costs, exertion and aesculapian instrumentality investments, and programs that bring group surviving connected nan streets into nan healthcare system.

About 70% of nan patients organization clinics service are insured done Medi-Cal, and nan remainder are either connected Medicare aliases uninsured, pinch a mini information connected backstage insurance, Silva said. The measurement would consequence successful layoffs and clinics being forced to close, and yet trim entree to attraction for low-income Californians, he said.

“One of nan things that stands retired that really highlights nan maltreatment of nan ballot inaugural process successful this lawsuit is that nan constituent of what’s connected nan ballot has thing to do pinch what he wants to discuss pinch us,” Silva said. “The petition was to guarantee 25,000 workers, aliases else.”

Regan besides denied that he asked nan clinics to support his unionization efforts successful speech for dropping Proposition 44.

“We wanted to conception a narration pinch nan session relation that prioritized due backing of nan organization clinics successful California, including restoring nan healthcare cuts that were introduced by nan ‘One Big [Beautiful] Bill,’” Regan said. “It was a strategical narration wherever we’re moving successful a mutually cooperative measurement to decently money nan healthcare strategy to respect workers, and they were not willing successful that.”

Regan’s opponents opportunity his strategy runs afoul of nan intent of nonstop populist and pushes nan bounds of legality.

During negotiations connected nan billionaire tax, fundamentally put nan onus connected Newsom to unit unrelated backstage hospitals and clinics to unionize their employees, nan sources said.

Despite a desire to telephone disconnected nan taxation measure, Newsom’s agency couldn’t supply guarantees to fulfill Regan’s demands, according to those sources.

California legislators changed authorities rule successful 2014 to supply much elasticity astir inaugural negotiations and to let proponents to propulsion measures disconnected nan ballot aft they stitchery capable signatures and suffice for nan election, said Mary-Beth Moylan, an subordinate professor of rule astatine McGeorge School of Law.

State law besides prohibits a proponent of an inaugural from bargaining for money aliases a point of worth successful speech for abandoning their measure, which hasn’t been tested successful court, she said.

“I deliberation nan volition down nan rule allowing nan ballot measures to beryllium negotiated disconnected was that nan speech would beryllium for nan Legislature to do nan point that you’re bringing astir successful nan measure,” Moylan said. “It is not to usage it arsenic leverage for obtaining thing else.”

Regan’s wealthiness measurement retroactively applies a one-time 5% taxation connected nan nett worthy of billionaires who were domiciled successful California arsenic of Jan. 1, 2026.

He and advocates of his connection formed it arsenic a solution to nan healthcare cuts from nan Trump administration. It comes arsenic nan progressive connection connected wealthiness inequality has gained support successful California and beyond.

“What’s singular astir nan business is that everyone — nan governor, nan Legislature, nan healthcare manufacture — everyone agrees that nan ‘One Big Beautiful’ measure is going to consequence successful 3.5 cardinal group losing healthcare coverage, 150,000 frontline healthcare workers losing their jobs, organization clinics and hospitals closing, and each of america who bargain aliases person our healthcare done job-based security are spending much connected premiums, deductibles, and copays because nan authorities defunded healthcare and successful return gave yet different information of immense taxation cuts to nan wealthiest Americans,” Regan said. “That’s why we person put Proposition 40 forward.”

Newsom contends that Regan’s solution won’t work.

Instead of paying much California taxes, billionaires would simply prime up and move to different authorities pinch a little taxation complaint earlier nan commencement of nan year, nan politician warned. The authorities fund is limited connected income taxes nan rich | salary connected banal marketplace and akin profits.

A study from nan Hoover Institution astatine Stanford University estimated that nan taxation would make only $40 billion, not nan $100 cardinal proponents claim, mostly because of an expected exodus of billionaires. Overall, nan taxation would consequence successful an estimated nonaccomplishment for nan authorities of $24.7 billion, pinch nan imperishable diminution successful early income taxation gross owed to billionaire migration eclipsing immoderate gains from nan one-time levy, according to nan report.

Regan rejected nan findings of nan study and formed uncertainty connected nan magnitude of taxes that billionaires really salary successful California.

Newsom sought to discuss pinch Regan to region nan billionaire taxation from nan ballot earlier nan opening of nan year. At nan time, Regan said he wanted an other $20 cardinal for healthcare successful 2027-28, which is beyond Newsom’s clip successful agency and not thing nan outgoing politician could promise, according to 2 sources acquainted pinch nan negotiations.

Regan said he ne'er asked for $20 cardinal successful backing for healthcare to region nan billionaire taxation from nan ballot. He said he was unfastened to proceeding replacement solutions that ne'er came.

“But did we ever make a proposal, aliases did we ever person a connection for thing different?” Regan said. “The reply is no.”

In nan spring, Newsom began moving to shape a conjugation against nan inaugural that includes Planned Parenthood, doctors and firefighters while billionaires launched a bid of counterproposals.

In an different divided wrong labor, awesome unions specified arsenic nan California Teachers Assn. and nan State Building and Construction Trades Council reason nan measure. Teamsters California and AFSCME California joined Regan. The SEIU California State Council and California Federation of Labor Unions person yet to return positions.

Under California law, proponents had until June 25 to rescind measures that earned capable signatures to suffice for nan ballot. Negotiations picked up again to region nan measurement from nan ballot soon earlier nan deadline. Two sources said Regan’s demands changed and allegedly had thing to do pinch raising money to offset national healthcare cuts.

Sources said Regan said he wanted national contracts pinch 2 backstage hospitals and a wellness clinic, an organizing neutrality statement pinch healthcare clinics statewide, nickname of his national from dialysis clinics and for billionaires to region measures they launched successful consequence to his tax.

Newsom’s agency said they couldn’t unit backstage companies to do anything. The governor’s aides offered an replacement scheme to dedicate astir $7 cardinal complete respective years to healthcare backing successful California, which didn’t move Regan.

“There were nary negotiations,” Regan said astir nan billionaire tax.

Days earlier nan deadline to propulsion nan wealthiness taxation measurement from nan ballot, UHW announced an connection to trim nan billionaire taxation from 5% to 2% of nett worthy that nan national said Newsom rejected. Sources said nan discuss was first offered successful a property merchandise and did not bespeak immoderate superior negotiation.

Regan group a extremity to adhd 25,000 caller members by this twelvemonth and has truthful acold added astir 8,000, according to nan union’s website.

In speech for removing nan billionaire taxation from nan ballot, sources said 1 of Regan’s demands was for Newsom’s agency to get progressive pinch battles for national contracts astatine hospitals successful Fresno and San Diego and a session successful nan Imperial Valley.

The national is tied up successful labour disputes complete caller attempts to unionize accommodation successful 2 of those places — Rady Children’s Hospital successful San Diego and Innercare, a organization session successful El Centro.

The dialysis manufacture became a ballot target for Regan 3 predetermination cycles successful a statement arsenic he attempted to unionize its workers.

The conflict is connected region aft dialysis companies agreed to not reason a $25 minimum costs summation for healthcare workers and UHW agreed to not target nan manufacture successful authorities aliases ballot measures done nan extremity of this year, but nan conflict turned DaVita and Fresenius Medical Care into awesome governmental donors successful authorities campaigns.

California’s billionaire people is besides expanding its beingness successful authorities politics.

Billionaires pushed 2 measures connected nan November ballot that activity to neutralize nan billionaire taxation and artifact caller taxes connected individual spot and assets and require audits of caller programs funded pinch typical taxes.

The billionaire taxation has besides go a nationalist rallying outcry for nan governmental left, drafting nan high-profile support of U.S. Sen. Bernie Sanders (I-Vt.) and others who are fed up pinch wealthiness inequality. Opponents of Proposition 40 person questioned whether immoderate of nan solutions Regan projected would person been capable for him to region nan measurement from nan ballot and debar nan wrath of progressives who backed nan tax.

Sacramento governmental observers opportunity nan unintended consequences of Regan’s taxation measurement are already reshaping California politics.

“When he did nan billionaire tax, each these group who ne'er engaged successful authorities yet woke up,” said Jim DeBoo, a Democratic advisor and erstwhile main of unit to Newsom. “And they aren’t going away.”

The measurement is causing a rift wrong nan SEIU California State Council, an umbrella statement that represents much than 700,000 workers from each SEIU unions including UHW.

The billionaire taxation only benefits healthcare. SEIU, which besides represents workers successful nan nationalist sector, nursing homes, kid attraction and different work industries, has go a target of California’s wealthiest caller governmental players contempt astir of its national members gaining thing from nan measure.

Billionaires and their companies, including Ripple co-founder Chris Larsen, task capitalist Tim Draper, Google and Meta person spent astir $30 cardinal connected a successful run to reason SEIU-backed progressive candidates aliases boost mean Democrats successful legislative races. The aforesaid donors spent only $50,000 connected independent expenditures successful legislative races successful nan full 2024 predetermination cycle.

Shaudi Fulp, a governmental strategist moving pinch Larsen and Draper, said a caller politician and lawmakers coming an opportunity to build caller governing coalitions astir issues that matter astir to Californians.

“California is entering a unsocial infinitesimal of transition,” Fulp said.

The billionaires’ strategy is whittling distant astatine SEIU’s power successful nan authorities Legislature, wherever nan authorities assembly has historically utilized its endorsements and service of volunteers to boost progressive candidates aligned pinch their cause. Moderates backed by billionaires hit astir each SEIU-endorsed campaigner successful much than a twelve races successful nan June primary, pinch grounds spending knocking national candidates retired of nan apical 2 successful places specified arsenic Bakersfield and Orange County.

The SEIU California State Council declined to remark for this story.

The conflict complete nan billionaire taxation is besides expected to go nan astir costly ballot measurement run of nan predetermination cycle, if not ever. The guidance is poised to exponentially outspend UHW.

“Look, nan only point that stands down a bully is erstwhile you punch him successful nan face,” said Brandon Castillo, a governmental advisor who has represented healthcare providers against UHW connected much than a twelve initiatives. “You can’t beryllium backmost and proceed to return punches aliases thing will change.”

Staff writer Nicole Nixon contributed to this report.