California Governor Faces Deadline to Act on Budget

This is Newsom's first budget since he took office in January.

California Gov. Gavin Newsom has until midnight Thursday to act on the state's nearly $215 billion operating budget.

This is Newsom's first budget since he took office in January. It includes a $21.5 billion surplus, the largest in at least two decades following years of budget cuts because of shrinking revenues.

Newsom has not said whether he will sign the budget. He could also veto it entirely or veto parts of it. But he told reporters earlier this week he "couldn't be more pleased" with the budget and said all that was left to resolve were "small issues."

While state lawmakers completed work on the budget earlier this month, that bill divides up California's state and federal tax dollars. Lawmakers are still negotiating with Newsom, a Democrat, about other bills that direct how the money will be spent.

Lawmakers have already agreed on most of the biggest items. They voted to expand taxpayer-funded health insurance to adults younger than 26 who are living in the country illegally. They agreed to tax people who refuse to purchase private health insurance and use the money to help families of four who earn as much as $150,000 a year to pay their monthly health insurance premiums. And they agreed to raise taxes on businesses and give the money to people who earn less than $30,000 a year.

But other items are still outstanding. Lawmakers have yet to vote on how to spend more than $1 billion to combat the state's homelessness problem. And they have not yet agreed on the details of a plan to spend $130 million from the state's cap and trade program to help improve drinking water for about 1 million people.

Newsom told reporters earlier this week those were "small issues." But he also said he was still negotiating with lawmakers on a plan that would penalize local governments who don't allow enough affordable housing construction by withholding some of their share of the state's transportation dollars — a proposal that faces fierce opposition.

"I've never had an experience this good in my 20 years in politics," Newsom said about the budget negotiations, telling reporters most of his experience with budgeting came when he was mayor of San Francisco during the Great Recession. "That was challenging. This is enlivening."

Copyright AP - Associated Press
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