- Associated Press - Thursday, January 10, 2019

SACRAMENTO, Calif. (AP) - The Latest on the California budget (all times local):

4:55 p.m.

A California association of counties is objecting to Gov. Gavin Newsom’s proposal to tie transportation funding to new housing units.

The newly elected Democrat said the entire state is in crisis over homelessness and a lack of housing and that local government needs to pitch in with more shelter of all kinds.

But Darby Kernan of the California State Association of Counties said it is concerning that Newsom would withhold critical transportation money when counties rely on private developers to build units.

Newsom is a former mayor of San Francisco and acknowledged that the provision might not go over well with local leaders.

But he said that state government is available to help smaller cities and counties and that more housing needs to be connected to improved transportation.


3:15 p.m.

California’s new governor says he plans to end the state’s current juvenile justice system “as we know it.”

That includes shifting the state’s few remaining juvenile justice facilities from the corrections department to the Health and Human Services Agency.

Gov. Gavin Newsom did not provide details in Thursday’s budget.

The chief probation officers association says the proposal could imperil reforms made in the juvenile justice system over the last decade.

Newsom says he’s making literacy and tattoo removal programs a priority to help adult ex-convicts get jobs.

His budget projects about $78 million in savings from a 2014 ballot initiative that reduced criminal penalties and requires that the savings be spent on rehabilitation programs. That’s up nearly $14 million over last year.


3:15 p.m.

Gov. Gavin Newsom is proposing to expand Medi-Cal coverage to immigrants who are young adults and lack legal status in the United States.

The proposed budget released Thursday says immigrants up to age 25 would be potentially eligible for the coverage.

It includes $260 million for the expansion, which would take effect no sooner than July.

In California, people who can’t prove they’re legally in the United States age out of full-scope Medi-Cal coverage when they turn 19.

The budget also includes $25 million for an immigration rapid-response program to help address the crisis on the border following the arrival of Central American migrants. It also includes $75 million for immigration-related services including legal assistance for college students.

Advocates at the California Immigrant Policy Center welcomed the new funding for the border region.


3 p.m.

Gov. Gavin Newsom’s first budget recommends a sharp increase in spending for cannabis programs.

California broadly legalized marijuana on Jan. 1, 2018, and results from the first year were mixed. Illegal shops continue to flourish, taxes collections fell far behind predictions and many communities decided to ban commercial pot activity.

The budget recommends just over $200 million for marijuana-related activities in the year that starts July 1, which would be over a 50 percent boost from the current year.

The budget also contains a telltale figure about the struggling pot economy: Income from the state’s excise tax on marijuana is projected to be $355 million by the end of June, roughly half of what was once expected.

The courts budget includes nearly $14 million for resentencing of thousands of drug offenders whose offenses are no longer crimes since California broadly legalized pot.


12:30 p.m.

Democrats praised the ambitious proposals in new California Gov. Gavin Newsom’s first budget, while Republicans say he isn’t doing enough to prepare for an inevitable recession.

Newsom presented his spending plan Thursday, four days after he took over from frugal Gov. Jerry Brown. He included $13.6 billion to continue building the state’s rainy day fund and to pay down debt and the state’s pension liability.

But Republican Assemblyman Vince Fong of Bakersfield says Newsom is proposing to spend tax dollars at a record pace. His $144 billion general fund budget includes $5.5 billion more than the current budget.

Senate Democratic leaders praised what they called the new Democratic governor’s progressive initiatives on education, affordable housing and health care that they say will improve people’s lives.


12:25 p.m.

California Gov. Gavin Newsom is projecting a $21.4 billion surplus, the largest since at least 2000.

That’s about $6 billion more than the non-partisan legislative analyst predicted in November.

Newsom says most of the money comes from his projected smaller increase in spending on Medi-Cal, the state’s health care program for low-income residents. He also says tax revenues are better than what was projected under the prior budget.

Newsom’s rosier surplus gives him more money to pay down pensions and invest in higher education and housing.

Newsom will work with the Legislature over the next six months to finalize the budget. Surpluses often change between the governor’s January budget presentation and the final budget due in June.



Gov. Gavin Newsom says California is “not playing small ball” as he seeks more than $1 billion to combat the most populous state’s homeless problem by encouraging new affordable housing.

The Democratic governor’s first budget Thursday proposes $1.3 billion in one-time funds for housing development.

He’s seeking to expand state tax credits to encourage more low- and moderate-income housing. He also wants to build housing on surplus state property.

He plans to give local officials money for homeless shelters, and take it away if they don’t meet state goals.

He’ll also seek to ease environmental protection laws to help encourage more housing.

The Democratic chairman of the Senate Housing Committee, Sen. Scott Wiener of San Francisco, called it a bold proposal to help overcome the state’s need for 3.5 million new homes.


11:45 a.m.

California Gov. Gavin Newsom is putting a heavy focus on education in his first state budget.

Newsom, a Democrat, wants to make a $3 billion one-time payment to California’s teacher pension fund on behalf of schools to help districts that are seeing more of their budgets eaten up by pension obligations.

He’s proposing $1.4 billion for higher education. The bulk, about $400 million, would go to the community college system with the goal of making tuition free for two years.

He wants to invest $500 million in infrastructure to provide more childcare and $750 million for kindergarten programs.

Beyond education, he’s boosting a tax credit for families by more than a half-billion dollars.


11 a.m.

Gov. Gavin Newsom first state budget plan totals $144 billion in general fund spending.

Newsom’s proposal, released Thursday, marks a 4 percent increase over the last budget approved by his predecessor, Jerry Brown. It’s the Democratic governor’s opening request in six months of budget negotiations with legislative leaders. He says 86 percent of the new spending is for one-time investments.

California has seen revenue soar amid a thriving economy. Newsom’s plan includes $13.6 billion to boost reserves and pay down debt and pension liabilities.

The budget expands the earned income tax credit, adds $1.3 billion for housing development and nearly $2 billion for early childhood education and care.

Including bonds and special funds the total budget is $209 billion.

Lawmakers must approve a spending plan by June 15.


6 a.m.

Gov. Gavin Newsom is expected to release his first state budget, which will outline his plan to boost spending on services for children while maintaining his promise to be fiscally prudent.

Newsom has already outlined more than $2.5 billion in spending proposals focused on early childhood education and health care. Newsom has focused much of his new early childhood spending on construction projects to improve existing facilities. That will limit the long-term cost of his initiative and help Newsom maintain his pledge to preserve rainy day savings.

Thursday’s budget release kicks off six months of negotiations with the Legislature, which has until June 15 to approve a balanced spending plan.

Gov. Jerry Brown signed a $139 billion budget last year.

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