Gov. Gavin Newsom submitted his proposed 2021-22 budget on Friday, outlining $227.2 billion in spending that would be proceeded by $5 billion in “immediate action” to help those hurt by the pandemic.
“In these darkest moments of the COVID-19 pandemic, this budget will help Californians with urgent action to address our immediate challenges and build towards our recovery,” said Newsom.
The Governor said the budget is built on “prudent fiscal management” that enabled the state weather economic setbacks in 2020, and he noted an improved revenue forecast for 2021.
The budget is 12% higher than the $202.2 billion approved by the Legislature last year after significant cuts due to uncertainty about the economic situation amid coronavirus shutdowns. However, tax collections from Californians who were able to continue to work resulted in an unexpected surplus.
The proposed immediate action plan includes:
- $2.4 billion for the Golden State Stimulus — a $600 state payment to low-income workers
- $575 million in grants to small businesses and small non-profit cultural institutions disproportionately impacted by the pandemic
- $70 million to provide immediate and targeted fee relief for small businesses including personal services and restaurants
- $2 billion to support a safe return to in-person school instruction starting in February, with priority for the youngest children and those with the greatest needs
- $372 million for COVID-19 vaccinations
For education, the budget calls for a record $90 billion for K-14 schools, and a $786 million increase for the University of California and the California State University systems with no hike in resident tuition and fees.
In a time of environmental change, the budget includes $1.5 billion for the infrastructure and incentives for electric and hydrogen vehicles to implement the state’s zero-emission goals and a $1 billion increase to support a coordinated forest health and fire prevention strategy. There is also $143 million to support 30 new fire crews, and $48 million to phase in new Black Hawk firefighting helicopters and large air tankers.
There’s also more money for housing, including $500 million for infill infrastructure, $500 million in low-income housing tax credits, and $1.75 billion to purchase additional motels to house the homeless and purchase or preserve housing for seniors.
It’s not all new spending; there’s a requirement for greater efficiency. The budget assumes a 5% permanent reduction in state operations expenditures, challenging departments and agencies to find more efficient means to provide services to Californians.
Senate President Toni Atkins of San Diego called the budget “a responsible proposal for the Legislature to build upon” before it is finalized at the end of June.
“We are working toward early budget actions to address the most pressing needs caused by the COVID-19 pandemic, including: renter and mom-and-pop landlord protections, getting school campuses reopened as safely as possible, assisting small businesses, and boosting economic recovery so California is poised to grow and succeed when we come out on the other side of these difficult times,” Atkins said.
But Assembly Republican Leader Marie Waldron of Escondido said the budget “doesn’t fundamentally solve many problems facing Californians” because it neglects basic principles.
“The government is being judged by results, not by big announcements, and the results Californians are seeing throughout their communities are persistent unemployment, shuttered businesses, closed schools, homelessness, rising violent crime and government dysfunction in the state unemployment system and the DMV,” she said. “We need to get back to the basics.”