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Trump Threatens to Eliminate Presidio Trust, Sell Off Offices in San Francisco
The White House has moved to eliminate the Presidio Trust, citing it as unnecessary federal waste, despite its self-sustaining funding model and bipartisan support. At the same time, the administration is pushing to sell off multiple federal buildings in San Francisco, including the Speaker Nancy Pelosi Federal Building, as part of a broader effort to reduce government real estate holdings. Critics argue these moves are politically motivated and could destabilize both the Presidio’s long-term sustainability and San Francisco’s already struggling commercial market. The federal office sales, reportedly influenced by Elon Musk’s associates, would shift government employees into private leases, raising concerns about long-term costs and efficiency. Local leaders, including Nancy Pelosi and state senator Scott Wiener, have vowed to fight the decisions, calling them short-sighted and damaging to the city.

Federal Officials Step Up Criticism of High Speed Rail
Transportation Secretary Sean P. Duffy criticized California’s high-speed rail project for financial mismanagement and announced a federal investigation into the use of a $3.1 billion grant. The project, initially expected to cost $33 billion, is now estimated at over $128 billion, with no clear timeline for completion. Governor Gavin Newsom had already scaled down the project to a shorter Central Valley line, but even that segment faces a significant funding gap. The Trump administration previously rescinded a $1 billion grant, later restored by the Biden administration, but future federal funding remains uncertain. Critics argue that the project is an unsustainable financial burden, while supporters highlight its economic benefits and job creation potential.

Redevelopment of Iconic San Diego Horton Plaza Faces Peril
The redevelopment of San Diego's Horton Plaza into "The Campus at Horton" is encountering significant financial challenges. The project, designed to transform the former shopping center into a mixed-use space with 700,000 square feet of office area, retail and dining options, now faces potential foreclosure due to over $350 million in unpaid debt. Experts highlight that, given the current economic climate, securing construction loans has become increasingly difficult and leasing such a vast amount of office space may not be feasible. This situation raises concerns about the project's viability and its anticipated $2 billion annual economic impact. The development firm has a 90-day window to address the debt, leaving the future of the site uncertain. (See related CP&DR coverage.)

Two Dams on Eel River to be Removed
A historic agreement has been reached to remove two dams on Northern California’s Eel River, restoring it to a free-flowing state while ensuring continued water diversions to the Russian River. The deal, supported by tribal, state and local leaders, includes compensation for the Round Valley Indian Tribes and funding for river restoration. While PG&E moves forward with decommissioning its Potter Valley hydroelectric project, a new $50 million diversion facility will be built to maintain water supply for Russian River communities. The agreement balances environmental restoration with agricultural and municipal water needs, though stakeholders still face challenges in determining future water allocations and funding. If successful, the project will mark a major step in reconciling conservation efforts with water security in Northern California.

CP&DR Coverage: Long-Awaited TOD Advances in Berkeley
The Berkeley City Council approved measures designed to spur new development at its Ashby station, after years of disputes between the city and BART over the station’s air rights. The city has agreed to relinquish its air rights over two parking lots that serve the Ashby station – thus enabling BART to develop multistory housing on the west lot, with community benefits – in exchange for city ownership of the east lot. That agreement enabled the council, in turn, to issue a request for development proposals. In fact, some advocacy groups called for the project to be 100% affordable housing. The city refused, on the basis that the project would be impossible to finance, even with a planned contribution of $26.5 million in city accordable housing funds.

Quick Hits & Updates

San Francisco Mayor Daniel Lurie introduced PermitSF, a new initiative aimed at streamlining the city's slow permitting process to support housing and small businesses. The plan includes a "shot clock" to cap permit review times, centralizing applications across departments and expanding online filing and tracking tools. Within 100 days, the city will work to increase service hours and cut bureaucratic red tape, with long-term goals of merging permitting responsibilities into a single department.

A Carlsbad citizens group has sued San Diego County over the approval of American Airlines' return to McClellan-Palomar Airport, arguing the decision violates environmental laws. The lawsuit, filed by Citizens for a Friendly Airport, challenges a two-year lease allowing 76-seat jets, exceeding the county’s 70-seat aircraft policy. The group, which previously won a lawsuit requiring additional noise studies for the airport’s master plan, cites concerns over noise, air pollution and safety.

Governor Newsom has proposed a $125 million mortgage relief plan to assist homeowners affected by recent natural disasters, including last month’s Los Angeles County wildfires. Funded by a past mortgage settlement rather than the state budget, the program would provide direct aid to prevent foreclosure, support mortgage counseling and offer temporary payment relief for those whose homes were destroyed or severely damaged.

Nevada County has legalized tiny homes on wheels as permanent residences to help address its housing crisis. Previously, living in these homes year-round was prohibited, but a new ordinance allows residents to do so legally. The move provides an affordable housing alternative, particularly for middle- and lower-income individuals, as well as seniors and young adults.

The Los Vaqueros Reservoir expansion project in Contra Costa County, initially proposed in 2017, was recently terminated and approximately $453 million in state funds have been freed up. The California Water Commission is currently evaluating options to reallocate these funds to other significant water storage and infrastructure projects across the state. Potential beneficiaries include the Sites Reservoir in the Sacramento Valley and the Del Puerto Canyon Reservoir near Patterson.

California ranks among the top "bicycle-friendly" states, recognized for its focus on improving bike infrastructure, safety and planning. The League of American Bicyclists emphasizes the need for continued efforts from state departments of transportation to enhance safety for cyclists, particularly through dedicated bike plans, funding and laws like requiring motorists to maintain a 3-foot buffer when passing cyclists.

San Francisco's Valencia Street is set to replace its controversial center-running bike lane with curbside lanes, following backlash from merchants and a unanimous SFMTA board vote. The new design will restore two-lane traffic, reduce parking by a third and use parklets, parked cars and posts as buffers for cyclists, aiming to better accommodate both bikers and businesses.

A feasibility study for La Jolla's potential cityhood projects an $8 million budget surplus in its first year, outlining costs, revenue sources and service options for police, fire, utilities and administration. While initial services would be contracted from San Diego, Mayor Todd Gloria has indicated the city may not provide long-term support, meaning La Jolla could need to establish its own municipal services or seek alternatives from San Diego County and other agencies.

The Save the Redwoods League struck a $24 million deal to expand Monte Rio Redwoods Regional Park in Sonoma County by 1,517 acres, preserving redwood forests and preventing logging or development. The expansion will enhance hiking and biking access, connect protected lands and create a vital wildlife corridor, with public access expected soon after the sale's completion.

California Insurance Commissioner Ricardo Lara has directed the FAIR Plan to continue promptly processing claims for victims of the recent Southern California wildfires. The plan, which serves as a safety net for homeowners, has requested an additional $1 billion in funding from its member companies to ensure it can meet these financial obligations.

The California Housing Partnership's 2024 report highlights the state's rental affordability crisis, particularly for low-income households, with extremely low-income renters unable to afford housing in any county. While median-income earners can generally find rental options, vacancy rates remain low, limiting availability. Racial and economic disparities persist, with Black, Latinx and Indigenous communities experiencing the highest housing cost burdens.

The Los Angeles County Board of Supervisors approved new zoning regulations for Westside and South Bay unincorporated communities to allow for the development of nearly 11,000 new homes. Key areas for redevelopment include Ladera Heights, View Park/Windsor Hills and West Fox Hills, with commercial properties being repurposed for multifamily housing, while the South Bay plan focuses on areas near transit and commercial corridors for increased density.

The 2024 Carnegie California Global Affairs Survey highlights significant concerns among Californians about the state’s infrastructure, particularly regarding ports and trade relationships. Sixty-two percent of respondents expressed concern about the operations and capacity of California’s ports, with nearly one in five being "very concerned."

California ranks as the "worst state to raise a family in 2025," according to a new report, scoring poorly in affordability, education, safety and quality of life. The state is particularly challenged by high child poverty, expensive housing and childcare and poor air quality, with Vermont topping the rankings for its strong performance in education, health care and overall quality of life.

The Coastal Commission approved the Venice Dell affordable housing project despite a setback from the city's Board of Transportation Commissioners, which blocked the land transfer needed for construction. The project, which has faced years of legal and political challenges, aims to provide 120 units for homeless and low-income residents but remains uncertain due to ongoing disagreements among local officials.