Gov. Newsom Proposes $213B State Spending Plan

SACRAMENTO (AP) — California Gov. Gavin Newsom proposed a $213 billion state budget Thursday that boosts spending on K-12 education, wildfires and homelessness.

His revised budget is up $4.5 billion from his first proposal in January and maintains a $21.5 billion surplus, the state's largest in at least 20 years.

His announcement kicks off negotiations with lawmakers, who must pass a budget by June 15 or lose pay.

Newsom is proposing $150 million more in grants to communities to help the homeless than he did in January, as well as $40 million to public colleges and universities to help homeless students.

"This homeless issue is out of control," Newsom said. "It is a stain on the state of California."

Newsom is boosting spending in some key areas, but his new budget is unchanged in many ways from January. He has already proposed new spending to expand health care for young immigrants living in the country illegally, prevent and fight wildfires, spur more housing and boost early child care programs.

He wants to add a new tax on drinking water while taking away taxes on tampons and diapers, and he's pledged to pay down debts and save money for a future recession.

His budget would bring the state's "rainy day" fund to $15 billion. Though California is flush with cash now, he warned the good times may not continue.

Newsom has until June 30 to sign the spending plan, and it will cover the fiscal year beginning July 1.

Instead of tapping the surplus to fund improvements to drinking water and bolster the state's 911 system, he has proposed tax increases that he said would create a long-term, sustainable pot of money.

It was partly homage to previous Gov. Jerry Brown, whose thrifty policies angered some in the Democratic-controlled Legislature but laid the groundwork for the massive surplus Newsom is working with. Last year Brown had ominously warned "darkness, uncertainty, decline and recession" were coming.

Newsom said Brown's philosophy is still "very present" in the governor's office.

"I think his legacy is so attached to his budgeting," Newsom said. "What he did, I appreciated and admire and I have no interest in undoing."

Newsom is facing pressure from lawmakers and outside groups to unleash the historic surplus.

Democrat Assemblyman Reggie Jones-Sawyer has asked for $100 million for youth development and pre-arrest diversion programs for children under 18.

Democratic Sen. Anna Caballero, who represents many Central Valley communities without clean water, has a proposal to tap surplus from water infrastructure improvements rather than enacting a new tax.

Gun control groups have asked for $39 million toward violence prevention, and some lawmakers have proposed expanding health care to all immigrants living in the state illegally rather than just those up to age 26.

Newsom, for his part, is poised to suggest more new spending of his own.

In April, following the deadly shooting at a San Diego-area synagogue, he vowed to spend $15 million on grants for security enhancements at nonprofits vulnerable to hate crimes. On Tuesday, he unveiled a "parents' agenda" complete with hundreds of millions of dollars in new spending on child care, paid family leave and tax credits for families with children under 6.

He did not provide specific costs for every program but promised more information in the budget update.

About $147 billion of the budget comes from the state's general fund, the pot of money that Newsom and lawmakers can spend however they choose. The rest is in special and bond funds dedicated to specific purposes.

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