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Surplus in hand, California governor reveals CA Blueprint budget

Gavin Newsom
Posted at 8:32 AM, Jan 10, 2022
and last updated 2022-01-10 18:07:23-05

SACRAMENTO, Calif. (AP) — On Monday, California Gavin Newsom rolled out his California Blueprint for the upcoming budget year with a focus on the climate crisis, homelessness, and reducing the cost of living for residents.

If you are not seeing the video playing below, you can watch here as well.

During his presentation, Newsom pointed out that the state is looking at over $34 billion in reserves, including $20.9 billion in Rainy Day Funds and a total surplus over over $45 billion.

Of the surplus, $16.1 billion is designated for Prop 98, $3.9 billion for Prop 2, and $5.1 billion for reserves. Leaving $20.6 billion for discretionary funding.

Newsom went on to identify what he considered as "existential threats" to the state:

  • Fighting COVID with Science
  • Combating the Climate Crisis
  • Confronting Homelessness
  • Tackling the Cost of Living
  • Keeping Our Streets Safe

The governor showed that $11.2 billion has already been spent in previous actions to battle COVID-19 in the state. The new budget proposes another $2.7 billion be spent on more testing, vaccines and boosters, support for hospitals and frontline workers, and doing more to fight misinformation.

In the ongoing fight against the climate change, the state looks to spend an additional $22.5 billion on top of the $15.1 billion it spent last year as part of the CA Comeback Plan. Among that spending is $2.7 billion for forest health and fire protection, with $1.2 billion specifically designated for wildfires. This includes $582 million to be spent on forest thinning and prescribed burns, grazing, and reforestation. Another $400 million will be focused on support for CAL FIRE, which includes money for new equipment, four new helicopters and 10 new helitanks, engines, bulldozers and fire crews.

Newsom also unveiled a $6 billion drought package that includes an additional $750 million on top of the $5.2 billion from the CA Comeback Plan. The $750 million will focus on immediate drought support, water conservation, groundwater recharge and assistance for small farmers.

Newsom also highlighted the state's focus on an "oil free future" and how the state is leading the world in that area.

"We all believe, I believe, no everybody, it depends on your industry, it depends on where the paycheck is coming from, but that's an oil-free future. Low-carbon, green, growth. Changing the way we produce and consume energy."

"California wants to maintain its international leadership. We put a stake in the ground. The first state in the nation to say we would not sell traditional internal combustion engines by 2035."

To accomplish that goal, Newsom introduced a $10 billion, two-year plan to move the state towards zero-emission vehicles, which includes an additional $6.1 billion investment through the CA Blueprint. $962 million will be earmarked for building decarbonization through retrofits and rebates. Other funds will target industrial decarbonization, green hydrogen development, food production and offshore wind projects.

Newsom also looked to help develop "Lithium Valley" in the Imperial Valley region into a world-class battery manufacturing "ecosystem."

In regards to the issue of homelessness in the state, the CA Blueprint looks to invest $2 billion in tackling the problem on top of the already planned $12 billion in the CA Comeback Plan.

Newsom touted this as the "largest homeless investment in California history."

A large portion of that money - $5.8 billion - will be focused on the Homekey program, including investment in behavioral health housing and hotel/motel conversions. $2 billion will be directed to help local governments deal with the problem.

Newsom announced that dealing with the increasing cost of living will also be a part of the budget, with a focus on reducing the cost of healthcare. A part of that will include the creation of the Office of Health Care Affordability, and the move by the state to produce its own insulin for residents.

The state also looks to implant full universal healthcare by January 2024 through Medi-CAL.

The budget also looks to spend $4 billion for children's behavioral health through Medi-CAL benefits, and community-based crisis intervention services.

Money will also be invested in reforming Medi-CAL.

Newsom said the state will continue to invest in small businesses through grants, tax credits, paying down unemployment insurance depth, loan guarantees, small business tax relief and more venture capital programs.

Over $2 billion will be spent to improve California's ports with investments in port, freight, and goods movement infrastructure.

The state will look to invest over $9 billion in transportation improvement with $4.9 billion on transit and rail projects, local projects, bicycle, and pedestrian improvements, and another $4.2 billion on high-speed rail.

The CA Blueprint also looks to transform education in the state and will increase spending to $20,855 per student, an increase over the %15,261 spent this year. Among the biggest announcements was the full implementation of Universal Pre-K at a cost of $4 billion. In addition, the budget looks to add more to after-school and summer programs, as well as special education.

The state also looks to spend money on reducing the adult-to-student ratio in schools, modernizing existing school facilities, and providing school meals with school kitchens and more farm-to-school investments.

Newsom also announced a goal of making higher education more affordable with a goal of getting the state at 70% degree completion. To help achieve that goal, the state will invest $1.6 billion in community colleges, funds for the CSU and UC systems, and cutting the cost of attendance by reducing the cost of student housing, expanding scholarships and grants, and moving textbooks closer to $0 cost.

Newsom also noted that the budget will look to make childcare more affordable by helping parents.

In regards to public safety, the new budget looks to bolster local law enforcement and create a new Smash and Grab Enforcement Unit. According to Newsom, the budget will allow more funding for local law enforcement to deploy more patrols and provide grants for small businesses impacted by smash and grab crimes.

Newsom ensured that prosecutors would hold criminals accountable with more funding for local district attorneys to prosecute perpetrators.

The state will also continue to work on getting guns off the streets by offering the largest gun buyback program in the country.