I like the general idea, but the current proposal isn't going to get much support because it splits the Bay Area in half. Doing that fails to recognize that a significant portion of people commute from the North Bay into the city. Not to mention that numerous agencies have been established to coordinate planning and environmental efforts in the area (ABAG, MTC, BART, and BAAQMD to name a few.)
I think the proposal would be stronger as a four-state solution:
1) a state similar to the proposed "Jefferson" state
2) the greater Bay Area/Monterey/Sacramento area
3) Central Valley & the south half of the Sierra Nevadas
4) SLO/SB/SoCal