Overview

• Lawmakers and Governor Gavin Newsom reached the agreement ahead of the July 1 fiscal year start after weeks of negotiations over a widening budget shortfall.
• New Medi-Cal enrollment for undocumented adults will freeze in January 2026 and a $30 monthly premium for those ages 19–59 takes effect in July 2027.
• The deal allocates $750 million in new tax credits for the California Film and Television Tax Credit program to support Hollywood production.
• Funding for the University of California, California State University and public transit agencies is maintained, though payments to the university systems are deferred and supplemented by zero-interest state loans.
• Gov. Newsom’s final approval hinges on separate legislation to streamline housing construction by cutting regulatory red tape.