Overview
- Assembly and Senate budget hearings underscored a sharp split between the governor’s plan and the Legislative Analyst’s Office, with lawmakers urging proposals before the May revision.
- The LAO projects an $18 billion deficit versus the governor’s $2.9 billion shortfall, a gap driven by roughly $30 billion in higher administration revenue assumptions tied to capital gains and tech.
- Newsom’s budget flags specific backfill needs from federal reductions, including about $1.1 billion for Medi‑Cal and roughly $300 million for CalFresh.
- Department of Finance officials told legislators the state is not positioned to fully backfill those federal cuts, warning of real impacts on enrollment in Medi‑Cal and CalFresh.
- Key figures shaping negotiations include about $350 billion in total expenditures, a $250 billion general fund, and a $12.6 billion starting shortfall, with roughly 60 Assembly hearings planned before May.