By Kaylynn Chang
SACRAMENTO, CA – In the California 2024 Budget Agreement, CA Gov. Gavin Newsom, the Senate, and the Assembly reached a crucial agreement on the state’s 2024 budget that aims to address the significant budget deficit while protecting vital services and investments.
The official budget agreement as released reveals the mission to preserve the multi-year fiscal strategy outlined in the May Revision, addressing not only the immediate budget deficit but also planning for the fiscal year 2025-26.
The governor’s office noted a key aspect of the agreement is the commitment to bolster budget resilience. It includes a proposal for additional legislation requiring the state to reserve a portion of anticipated surplus funds for allocation in a future budget act.
The agreement claims that this measure aims to protect the state from overcommitting future revenues before they are realized, providing an added layer of fiscal security.
In a statement, Anne Irwin, founder and director of Smart Justice California, said, “Despite a difficult budget year, Governor Newsom, Assembly Speaker Rivas and Senate President Pro Tem McGuire have delivered a budget that makes smart choices for public safety while avoiding devastating cuts to public health services, crime victim services and reentry programs.”
Irwin added, “We applaud Pro Tem McGuire, Speaker Rivas and Governor Newsom for prioritizing the safety and well-being of California crime victims…we thank them for restoring $50 million in flexible direct cash assistance for victims in the aftermath of a crime, and allocating $103 million to ensure that the critical, lifesaving services that victims of domestic violence and other forms of violence rely on will continue uninterrupted.
“We are also pleased California leaders preserved funding for adult reentry grants and identified additional cuts to wasteful and unnecessary prison spending, resulting in $750 million in savings that can be better used to meet other, more pressing needs.
“California’s elected leaders have delivered a more equitable budget that will allow us to continue pursuing smart, proven solutions and create a safer California for all,” Irwin said.
Per the governor’s office, the agreement implements minimum wage increases for healthcare workers as stipulated in Senate Bill 525. It also highlights the budget’s focus on maintaining fiscal discipline amid global economic uncertainties.
The main numbers from the 2024 California budget agreement include figures that show a total expenditure of $297.9 billion across all funds, including $211.5 billion from the General Fund.
The budget also shows the Special Fund for Economic Uncertainties, which remains balanced over the next two fiscal years with positive balances of $3.5 billion in 2024-25 and $1.5 billion in 2025-26.
The agreement includes planned withdrawals from the Budget Stabilization Account, commonly known as the Rainy Day Fund. It plans to utilize $5.1 billion in 2024-25 and $7.1 billion in 2025-26, while still maintaining a robust reserve of $22.2 billion at the end of the 2024-25 fiscal year. This strategic use of reserves aims to preserve budget resilience.
Education funding under Proposition 98 is another key element of the budget, ensuring the minimum guarantee at $115.3 billion, with $82.6 billion from the General Fund. The official agreement states this allocation supports Pre-K-12 schools and community colleges, maintaining education programs and stopping potential classroom reductions.
Outlining a current $46.8 billion deficit for the budget year, the budget agreement seeks to resolve this through a combination of reductions, revenue measures, and strategic fund shifts. It also detailed that key financial solutions include $16.0 billion in expenditure reductions across various sectors and $13.6 billion generated through revenue increases and internal borrowing from special funds.
Notable reductions, per the released budget, involve a 7.95 percent cut in state operations, saving $2.17 billion from the General Fund. Additionally, the California Department of Corrections and Rehabilitation will see a reduction of $358 million, with the total reductions amounting to $750 million as mentioned in the official agreement.
The agreement shows that the budget will safeguard key programs, ensuring $115.3 billion for education under Proposition 98, and maintaining funding for Medi-Cal, behavioral health programs, and In-Home Supportive Services. It also preserves significant investments in broadband infrastructure, including $250 million for the Middle Mile Broadband Initiative.
