California Record Revenue- Budget

Recovery, Recall and Record Revenue: What’s Driving Newsom’s Budget

Tuesday: Gov. Gavin Newsom’s $267.8 billion budget proposal reflects the wish list of a state “just flush with cash.”

https://www.nytimes.com/2021/05/18/us/california-gavin-newsom-budget.html?

 

Six-hundred-dollar checks. Universal prekindergarten. Forgiveness for back rent, traffic tickets, utility bills. Big investments in the electrical grid, broadband, wildfire prevention, drought mitigation. Tax breaks for small business and Hollywood.

Flush with a huge surplus and threatened by a campaign to recall him from office, Gov. Gavin Newsom last week proposed a state budget that was the government equivalent of that time everyone in the studio audience got a Pontiac on Oprah. This week, state legislators took up the $267.8 billion plan.

With a mid-June budget deadline and Newsom’s fellow Democrats dominating the Legislature, the broad priorities are unlikely to change much. Still, like all those free cars, it’s a lot to process. Here are a few things to know:

This budget is about both the recovery and the recall.

Newsom has been in campaign mode for months, since it became clear that the Republican-led recall effort would most likely lead to a special election. Polls show that an increasing majority of voters disapprove of the recall. But he’s still in a vulnerable position with lawmakers and lobbyists.

Last week’s budget rollout was a cavalcade of photo ops for big-ticket line items: Rebate checks of up to $1,100 on Monday for middle-income Californians; historic spending on homelessness on Tuesday; an expansion of preschool to all 4-year-olds on Wednesday; a major small-business grant program on Thursday.

For the teachers’ unions that helped elect him, the governor proposed a record $14,000 in per-pupil school funding. For parents furious that more than half of the state’s public school students remain learning remotely, that funding was contingent on an in-person return to classrooms.

Progressives who get out the vote for Democrats in California elections got repayment of billions of dollars in back rent and utility bills for low-income renters, funding for pilot universal-basic-income programs, and forgiveness of some $300 million worth of traffic tickets for low-income drivers. Newsom also proposed extending Medi-Cal to undocumented workers over 60 and significantly expanding 

Businesses have already received a $6.2 billion tax cut. But the governor also proposed hundreds of millions of dollars in incentives for companies to relocate to California, for tourism marketing and for tax credits to lure filming back from, he said, “places like Georgia whose values don’t always align with the production crews.”

 

NY Times.  May 18,2021