In a significant development last week, the U.S. Congress concluded a long process that began in January by passing H.R. 1, a massive tax and spending bill, which has now been sent to President Donald Trump for his approval on July 4.
This 870-page law, referred to by its supporters as “The One, Big, Beautiful Bill Act” and criticized by opposition as “The Big Ugly Bill,” is poised to reshape San Diego’s economy, institutions, and communities, despite strong opposition from local Congressional representatives.
The bill garnered no support from Democrats in either chamber, with California’s Senators and four out of five San Diego County representatives opposing it, except for Republican Rep. Darrell Issa, who supported the measure. Such a stark partisan divide typically poses a challenge in the Senate, where a filibuster often requires 60 votes to overcome; however, this legislation advanced under special budget reconciliation rules, which only necessitate a simple majority of 51 votes.
With the legislation set to take effect, it’s important to understand its implications for specific groups in San Diego.
**Winners**
A few groups within San Diego may see financial benefits from the newly passed bill.
**The Military**: San Diego hosts the largest concentration of U.S. military assets globally, particularly naval ones. The new law aims to enhance support for military personnel’s housing and healthcare needs. Additionally, it allocates significant funding—tens of billions—for shipbuilding and unmanned naval systems, which will likely benefit Naval Base San Diego and local defense contractors, such as Lockheed Martin and General Atomics.
**Higher-Income Taxpayers**: A substantial portion of the bill’s financial structure revolves around making permanent tax cuts enacted in 2017. The changes will lead to prolonged lower income tax rates, increased deductions and credits, and the temporary exemption of certain tip and overtime earnings from taxation. The Yale Budget Lab forecasts that the wealthiest 5% of taxpayers in the nation will receive the highest income boosts from this legislation, with this demographic over-represented in San Diego County, accounting for roughly 10% of all tax filers.
**Losers**
On the flip side, there are more categories of local constituents who may suffer due to provisions in this bill.
**Low-Income San Diegans**: The new law slashes federal assistance for Medicaid (known as Medi-Cal in California) by an estimated 18%, alongside a 20% cut to the Supplemental Nutrition Assistance Program (CalFresh in California). With nearly 880,000 residents in San Diego County enrolled in Medi-Cal and over 400,000 receiving CalFresh help, these cuts pose a grave threat to individuals and families living on under $30,000 annually. The Washington Post suggests that these measures represent the most significant reductions to the federal safety net in three decades, enforced through newly established work eligibility criteria, documentation requirements, and diminished cost-sharing with states. In a recent move, the County Board of Supervisors called for an analysis to evaluate the potential impacts of these budget cuts on local residents and organizations, aiming to develop strategies to bridge service gaps.
**Nonprofit Hospitals and Clinics**: Medi-Cal serves as a crucial health insurance program for low-income children, adults, and seniors, and many local nonprofit hospitals and clinics rely on this reimbursement. For instance, in 2023, Medi-Cal accounted for over half of the revenues for Rady Children’s Hospital, while roughly two-thirds of patients at Family Health Centers of San Diego depended on it. These cuts will compel providers to reduce staffing and services while increasing emergency room visits and uncompensated care due to newly uninsured individuals.
**Grocery Stores**: As cuts to CalFresh take effect, the retail outlets where recipients spend their benefits will inevitably feel the pressure. In 2024, San Diego County residents are anticipated to have collected approximately $890 million in CalFresh benefits, redeemed across 2,300 participating grocery stores county-wide. The hardest-hit retailers will likely be those situated in lower-income areas already underserved by mainstream supermarkets.
**Clean Energy and Energy Efficiency Providers**: The legislation effectively negates the federal subsidies established in the 2022 Inflation Reduction Act (IRA) that were intended to promote clean energy production and decrease greenhouse gas emissions. San Diego is home to a multitude of clean technology organizations—utility companies such as SDG&E, manufacturers like Solar Turbines, and research institutions like Scripps Institution of Oceanography—that benefited significantly from the IRA. The bill’s provisions deny local real estate developers and contractors the advantages of tax credits for initiatives focused on home energy efficiency and the installation of electric vehicle chargers. Furthermore, this legislation deals a fatal blow to EPA programs that supported local nonprofits dedicated to enhancing environmental quality in low-income neighborhoods.
**Immigrants**: A substantial increase in funding for Immigrations and Customs Enforcement (ICE) accompanies this bill, which encompasses additional funding for more ICE agents and expanded immigrant detention and removal facilities. The Brennan Center indicates that the bill transforms ICE into the most extensive federal law enforcement agency. This reflects an unspoken acknowledgment that President Trump intends to deport not just undocumented immigrants with criminal records—as indicated during his campaign—but also millions of law-abiding individuals who have been living and contributing to American society for years. In San Diego and Imperial counties, over half of the immigrants arrested by ICE in 2025 had no prior criminal charges or convictions, a trend that has been on the rise in recent months. The repercussions of an intensified enforcement campaign will not only affect immigrant families but also extend to the businesses, schools, and organizations within immigrant communities, as well as local industries such as tourism and agriculture that depend heavily on immigrant labor.
Following the bill’s passage, political observers swiftly began pondering how President Trump would articulate the benefits of this legislation to an initially skeptical public, alongside the strategies Democrats may pursue to regain Congressional control in 2026. In the interim, local governments, businesses, and residents within San Diego will have to contend with the many ramifications tied to the bill, which signals a shift toward a more adversarial relationship between California’s localities and Washington D.C.
image source from：voiceofsandiego
