California Lawmakers Strike Budget Deal

Sacramento, CA — While details are limited, Governor Gavin Newsom says he has reached an agreement with legislative leaders on a 2020-21 budget.

The state legislature passed a proposed new budget last week, but it had failed to garner Newsom’s support.

Regarding the revised plan, to close a 54-billion shortfall, Newsom states, “In the face of challenges, we have agreed on a budget that is balanced, responsible and protects core services – education, health care, social safety net and emergency preparedness and response. This budget also invests in California small businesses harmed by the pandemic.”

The spending plan calls for furlough days and reductions for various state employees. Higher education is also anticipating a 10-percent cut. It also cuts $4.4 billion in manufacturing tax breaks for businesses. Medi-Cal funding is expected to avoid cuts, and schools and community colleges would maintain current funding levels, but $12-billion would be deferred to future years, allowing districts to borrow against the money, with the state planning to pay them back later.

The plan also relies on billions of dollars in federal funds from the US Congress, but it is currently unclear if that money will materialize.

More details are expected to be announced in the coming days ahead of a vote.