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oh this might be an issue where ~/.pulumi doesn't auto-upgrade because there's other things put in there by the install scripts so it doesn't think it's an empty folder. You probably need to run an explicit `pulumi state upgrade` command.

In my case, there is no `~/.pulumi` folder yet, so it's using the legacy style on initial creation of that directory when I run `pulumi stack init dev --create`. Also, when I run this in a fresh CI/CD environment, it seems to successfully instantiate with the new state style when I run `pulumi login --local` but if I run `pulumi login <file://some-other-path>` it creates `some-other-path/.pulumi/stacks` in the legacy style.

I think that you were actually correct now, but the strangeness is because I'm using `PULUMI_HOME` which had an additional configuration file in it, and I think that's what was causing the old style state. The confusion was that though I had `PULUMI_HOME` set, `pulumi login --local` stores things in `~/.pulumi`.

Yeh PULUMI_HOME changes where to look up plugins but not the default location for the state store. It _probably_ should but not a change we can safely make now.
I've pinged our team internally to see if we can make the upgrade logic a bit smarter and check if there's any old stack files, rather than if there's any files/folders at all. Should make it auto-upgrade in a few more places.

That sounds great! It's a bit of a challenging thing to debug, I have it working on my local but not yet in the CI environment, though things appear to be mostly identical. Anyways, will likely figure it out soon. Thanks for the help.

It turns out that `yarn install` adds plugins to the `.pulumi` folder, which is enough to trigger the old state style. I'm able to work around this in my CI environment.