SACRAMENTO, Calif. (CN) — The first cracks between the Legislature and California Governor Gavin Newsom over the budget appeared Tuesday, as some lawmakers hammered staff over proposed financial cuts.
The Assembly Budget Committee — followed that afternoon by the Senate Budget and Fiscal Review Committee — met for the first time after Newsom released his proposed budget on Jan. 10. The governor’s budget calls for $291.5 billion in expenditures, with a deficit of $38 billion. The Legislative Analyst’s Office sees a deficit closer to $68 billion.
Newsom proposes bridging the budget gap by pulling from financial reserves, cutting spending, and delaying already approved expenditures.
Assembly members on Tuesday pointedly questioned both Department of Finance employees and state analysts about specific cuts.
Assemblymember Corey Jackson, a Moreno Valley Democrat, said his focus is on whether any cut promotes stability or instability, looking to eliminations or delays in programs like family stabilization services.
“I think that’s kind of a trick question,” said Erika Li, chief deputy of budgets at the finance department.
“I don’t do trick questions,” Jackson replied.
Li conceded that, under the financial circumstances, some budget proposals will negatively impact Californians. They will be felt across the board, including programs for foster youth and nursing, as well as housing and homelessness.
One cut includes $30 million to the family urgent response system, which offers around-the-clock emergency response for current or former foster youth and their caregivers. A handful of people during the committee’s lengthy public comment session urged Assembly members, and later the Senate committee, to restore those funds.
“Protect our foster youth in the state budget,” said Brittany Walker, executive director of Butterfly’s Haven, which provides supportive services to youth.
Committee members pushed back against proposed cuts, as well as how budgeted funds are spent.
Assemblymember Sharon Quirk-Silva, a Fullerton Democrat, questioned the efficacy of certain expenditures. She pointed to over $100 million for a homeless encampment program. People are removed, but it’s unknown if they received housing.
Quirk-Silva also noted that $1.5 billion is allocated for broadband expansion. However, billions of dollars have gone toward broadband over the past few years. She questioned whether this expenditure is necessary.
“I know that we’re going to have some tough decisions,” she said.
Delays in funding, as opposed to outright cuts, concerned Assemblymember Jim Patterson, a Fresno Republican. Originally slated for $250 million for downtown infrastructure improvements, the city wouldn’t see the lump sum. Instead the governor’s budget would spread out the money over multiple years.
“It was kind of a kick to the gut to us,” Patterson said, adding that state analysts indicated proposed delays could turn into future cuts. “It sounds like the spigot’s going to be turned off.”
Assemblymember Alex Lee — a San Jose Democrat — said the governor’s proposed cuts affect the programs that support Californians who suffer under personal debt and a high cost of living.
“They’re paying into a system that doesn’t support them,” Lee said.
Lee sponsored a bill that would have imposed a tax on the extremely wealthy. It died in committee this month after Newsom said he wouldn’t sign a wealth tax bill.
The issue of high-earners, and their flight from the state, came up in the Senate Budget and Fiscal Review Committee, which also met Tuesday.
State Senator Brian Dahle — a Bieber Republican — said the state’s top 1% of earners pay the most in taxes and are leaving. He argued the Legislature should determine why the state is in its current financial straits.
“This is going to hurt if we don’t fix the fundamental problems in California,” Dahle said.
State Senator Shannon Grove, a Bakersfield Republican, pointed to proposed changes to Senate Bill 525, which implemented a $25 minimum wage on a sliding scale for qualifying health care workers.
Newsom in his budget calls for those wage hikes to be tied to availability in state funding. The budget also has no funding for the state to implement the new law.
Democrats on the panel echoed their counterparts on the Assembly committee, questioning the removal of funding for programs affecting housing, homelessness and foster youth.
State Senator Steve Padilla, a Democrat from San Diego, said cutting programs already in place hurt the ability of local governments to make long-range plans. State Senator Caroline Menjivar — a San Fernando Valley Democrat — said it’s possible that as many as one in three foster youth become homeless. Cutting programs for them essentially allows them to fall into homelessness.
State Senator and committee chair Nancy Skinner periodically reminded senators and the public that several more hearings on the budget would occur.
“We’ve not adopted this budget,” the Berkeley Democrat said. “It’s a proposal.”
Budget subcommittees will start meeting over the coming weeks as lawmakers craft the budget. Updated revenue numbers are expected in May, which will lead to what’s called the May revise, an updated budget.
The Legislature must pass a budget by June 15.
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