Winners and losers in the California budget deal
Monday night, Gov. Gavin Newsom and legislative leaders finally announced they had reached a budget deal. The bills will start being voted on today to finalize the agreement before the new fiscal year starts on July 1. The deal sets spending levels and policy across a wide range of issues affecting Californians.
- Covered California patients: California has collected more than $1 billion since an enactment of a tax that penalizes residents who don’t have health insurance. Newsom was going to temporarily move $333 million of the penalty money to the general fund. But advocates and lawmakers fought for the money to go toward Covered California’s cost-sharing reserve. The deal also commits $82.5 million to lowering health insurance costs over the next year.
- Homebuyers: Saved from the chopping block were a few programs meant to help California residents buy homes. The Dream For All program, which offers state-backed home loans for first-time buyers, will receive an additional $200 million after having its initial funding drained in less than two weeks after its implementation by eager buyers.
A handful of losers:
- Climate change advocates: The budget slashes nearly $3 billion from climate change programs, down from $5 billion in the Legislature’s June 15 budget and the $6 billion cut proposed by Newsom in January. Some funding was restored for smaller climate-related programs, however. Newsom is also seeking federal climate funding from the Inflation Reduction Act and the Infrastructure Investment and Jobs Act.
- Cities dealing with homelessness: Though the budget includes $1 billion for local programs, it’s only a third of the $3 billion city officials lobbied for in guaranteed state funding. Local leaders and activists say that Newsom’s current approach of handing out one-time annual grants rather than guaranteed ongoing funding does not help solve the state’s enduring homelessness crisis.
And a mixed bag for others:
- K-12 teachers and schools: The budget includes a historic 8.22% cost-of-living adjustment for public schools, $1 million for the Department of Education to establish a dyslexia screening task force and $300 million allocated for schools with the highest concentrations of poor students. But there were also some cuts: $200 million decrease to an arts and music grant and a $1.6 billion reduction in the Learning Recovery Block Grant.
- Transit agencies will receive a total of $5.1 billion over four years, though the money will be subject to accountability measures and state oversight. Because the funds will only keep agencies afloat over the next few years as they face a looming “fiscal cliff,” Democratic Sen. Scott Wiener from San Francisco has authored a bill that would hike tolls on seven Bay Area bridges. The proposal would bring in about $180 million annually.
Read a full rundown of what you need to know about the budget deal from the crack CalMatters team of reporters.
Speaking of the state budget: Can reviving a long-dormant commission help low-wage workers of today? That’s what some legislators are hoping for by including a small, $3 million line item in the budget that would bring back the Industrial Welfare Commission from its slumber.
Originally established during the Progressive Era to support marginalized workers, particularly children and women working in canneries and garment factories, the commission set industry standards regarding things including breaks, uniforms and even the minimum wage, as Jeanne Kuang of the CalMatters California Divide team explains.
Eventually, the commission was defunded and pushed to disband in 2004 at the urging — of all groups — the California Labor Federation. But legislators want to restore it so it can prioritize setting standards for industries that have at least 10% of its workers living below the federal poverty line.
This is making business groups bristle, Jeanne reports. They argue that the commission, if revived, would give the state a loophole to issue rules for fast food companies.
There’s recent history on that: In September, Newsom signed a law that would establish a council to oversee the wages and working conditions in fast food restaurants. But the legislation has been essentially stalled. Industry groups spent more than $4 million to qualify for a referendum on the 2024 ballot to overturn the law, so it can’t go into effect until after voters decide if they want to keep it.
Unless, that is, the Industrial Welfare Commission comes back. The bill would allow about 10 months — right up to about a week before the November 2024 election — to issue new standards. Though the bill itself makes no mention of the fast food industry, the tight time frame means the new commission would only be able to focus on a few industries that meet the poverty threshold — making fast food very likely to be considered.
CalMatters covers the Capitol: CalMatters has guides to keep track of your lawmakers, explore its record diversity, make your voice heard, understand how state government works and follow the state budget process. We have a lesson-plan-ready version of the explainer — especially made for teachers, libraries and community groups — as part of the CalMatters for Learning initiative. We also have Spanish-language versions for the Legislature’s demographics and the state government explainer.
Other Stories You Should Know
1 Guaranteeing “high-quality” education
An initiative to amend the state constitution began as a response to something that Los Angeles Unified Superintendent Austin Beutner said years ago. During the COVID-19 pandemic, when parents grew increasingly frustrated over school closures and distance learning, Beutner said a district is only required to provide a free public education — not a high-quality one.
That prompted former Los Angeles Mayor Antonio Villaraigosa and a group of education advocates into action, writes CalMatters’ K-12 education reporter Joe Hong. Together, they want to make a “high-quality education” a civil right in California.
Before they start seeking signatures to have the proposal appear on the 2024 ballot, however, the coalition must land on the final language. Of the three versions of the initiative language that the Attorney General’s office already approved, the third is the coalition’s first choice.
It reads: “The state and its school districts shall provide all public school students with high-quality public schools that equip them with the tools necessary to participate fully in our economy, our society, and our democracy.”
Putting that in California’s constitution, supporters argue, would empower families and students to hold their schools and districts accountable.
- John Affeldt, managing attorney at Public Advocates civil rights advocacy group: “If education is going to be fundamental and meaningful… it has to deliver something of decent quality.”
Though the ballot measure faces no organized opposition, it still has its critics. The wording of a “high-quality” education is purposely vague, and could open the door to various legal battles — parents taking schools and districts to court over a range of issues such as teacher layoffs, school closures, remote instruction and book banning.
- Richard Barrera, San Diego Unified School District board member: “It seems like the intention is to initiate lawsuits. It seems like it’s written in a way to drain funding from public schools to go into the pockets of lawyers.”
It’s been known to happen: In 2010, a group of grassroots organizations unsuccessfully sued the state to guarantee the right to a high-quality education. And a 2022 version of the ballot measure strongly suggested the possibility of legal action against schools and districts, though that language has now been scrubbed in the 2024 versions.
As for teacher unions, the California Teachers Association has decided to keep mum about the measure until it makes it onto the ballot, if it ever does. Keep in mind: After finalizing the language and fulfilling other requirements, supporters will need to gather at least 874,641 signatures — or 8% of votes cast in the last election for governor — to qualify the measure.
Gay marriage: Another constitutional amendment took another step Monday toward next year’s ballot. The state Assembly approved a measure to enshrine the right to same-sex marriage. Specifically, ACA 5 would repeal Proposition 8, approved by voters in 2008 and remove language defining marriage as between a man and a woman.
- Tony Hoang, executive director of Equality California, in a statement: “Today’s vote by the California Assembly is a tremendous victory for fairness, justice, and love.”
The measure is expected to also get through the Senate, where enough senators have signed on as co-authors. It is one of several potential constitutional amendments under consideration by lawmakers this session.
2 More accountability on climate?
The point of two climate-related bills being considered in the Assembly appears straightforward enough: Amid a time of worsening wildfires, dramatic swings between floods and droughts in California and climate disasters that have cost the U.S. an estimated $1 billion this year so far, the Legislature wants to hold companies who emit a lot of greenhouse gases more accountable.
As CalMatters’ climate reporter Alejandro Lazo explains: Senate Bill 253 would require about 5,300 companies with $1 billion in annual revenue to disclose greenhouse gas emissions, and SB 261 would require more than 10,000 companies with $500 million in annual revenue to prepare reports on how climate change poses financial risks to their operations in California and globally.
Because companies that do business in California would just need to hit the revenue threshold, the proposals could impact a wide range of industries — from Bank of America to McDonalds. The end goal is to provide a more complete picture of carbon emissions, according to the legislators who introduced the bills.
- Sen. Scott Wiener, author of SB 253: “This is basic transparency. It’s important to know which corporations are walking the walk, especially as we see corporations that market themselves as green.”
The California’s Chamber of Commerce and industry groups oppose the measures, arguing that the numbers could be inaccurate. Businesses are required to report their emissions and energy use from both their direct operations and from less direct sources, such as their supply chains. This could lead to duplicate data points and result in misinformation and misguided public policy.
Generating reports is also costly, complex and laborious — smaller or mid-sized businesses risk losing contracts with larger corporations because they might not have a full account of their own emissions.
- Brady Van Engelen, CalChamber lobbyist: “Reporting regimes are kind of the wild west of the climate policy world. These reports aren’t free, it’s not like you just get to press ‘control P’ and have a report.”
3 A unicorn in the Legislature
It turns out the San Bernardino Democrat has another lesser-known claim to fame: He’s the only Assemblymember getting paid less than the rank-and-file Assemblymember salary of $122,694 a year. (Those in leadership positions get higher salaries.)
And it’s by his own choice:
According to his office, Ramos has always declined salary increases since winning election in 2018. Before he was sworn into office in December 2018, the salary for Assemblymembers was $107,242.
He turned down the raise that year to $110,459, and subsequent increases approved by the state’s salary commission. So his pay is still $107,242 a year.
- Ramos: “I declined the legislative salary increases because I felt it didn’t feel right as others in my district were and are going through hardships like wildfires, droughts, budget deficits and the pandemic. It is a way to further serve my district and state as we get through the trials of recent years.”
By the way, the average salary in California is $73,220 a year, according to 2022 federal figures. So Ramos is still making 46% more than the average Californian.
CalMatters columnist Dan Walters: The GOP U.S. House censure of Rep. Adam Schiff for his scrutiny of former President Donald Trump boosts Schiff’s U.S. Senate campaign.
A case before the state Supreme Court on at-large elections in Santa Monica could weaken voting rights, writes U.S. Sen. Alex Padilla, a California Democrat.
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California to receive $1.8 billion to improve high-speed internet across state // CBS Bay Area
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State worker union demands 30% raises; California says ‘no’ // The Sacramento Bee
Home insurance is hard to get in California. Is a ‘war’ brewing? // San Francisco Chronicle
Prop. 28 a windfall for arts education, but implementation poses challenges // EdSource
Former Assemblymember Dickinson running for Sacramento council // The Sacramento Bee
Hollywood directors ratify new contract // The New York Times
Actors’ guild leaders cite ‘extremely productive’ contract talks // Los Angeles Times
How the narrative of SF as dystopian hellscape is affecting the city // San Francisco Chronicle
Leaders urge Biden to expand San Gabriel Mountains National Monument // The Orange County Register
San Jose wants to help renters fight evictions // San Jose Spotlight
Opinion: Zoot Suit riots: How Black LA defended Mexican Americans // Los Angeles Times