Why did California's budget grow 40% under Gov. Gavin Newsom?
Why did California's spending grow 40% under Gov. Gavin Newsom?
California lawmakers and the governor tonight are expected to pass the largest state spending plan in California's history. It's *** big 1. KCRA3 political director Ashley Zavala joins us to explain what this budget includes this year. Yeah, California's 351. $7 billion budget this upcoming year represents *** 40% increase in state spending overall since Governor Gavin Newsom took office, and tonight we're taking *** closer look at why. First, let's look at the numbers. The first ever state spending plan. That Governor Newsom agreed to with lawmakers was $208 billion total. That was back in 2019-2020. You see the numbers climb, and now this year at *** record high $351.7 billion to $352 billion rounded up there in this graph. So I checked in with our state's financial experts with the Department of Finance and the California Legislative Analysts Office. They both agree that this mainly has to do with increased spending on education and health and human services. California's legislative analyst did do an analysis of California's ballooning budgets. Overall, it found 70% of the spending growth has just been trying to sustain and pay for programs that were established before the governor took office. Now the growth in spending under Governor Gavin Newsom has been on community colleges by an additional $37 billion Medi-Cal by an additional $25 billion plus billions more for the Department of Developmental Services in Home supportive. Services, child care slots, and university, uh, universities under Governor Gavin Newsom. Now Medi-Cal is California's health insurance program for lower income people. Governor Newsom has expanded this program to cover more people, including undocumented immigrants. For this year's budget, about 2 million undocumented immigrants are on Medi-Cal. New adults ages 19 to 65 are not able to sign up right now, but undocumented children and seniors can. Now starting in July of 2027 under this new state spending plan, the state will charge each undocumented individual $50 *** month for that coverage. In *** hearing today, this was *** point of tension between the Republican and Democratic leaders of the Assembly's Budget Committee who argued about spending on veterans versus undocumented people. When we are talking about *** priority and the budget reflecting our values, I think it's interesting to say that we spend now 8 to 10 times more on illegal immigrant services than we do for the veterans and the men and women who have fought and died for this country and the state. With all due respect, Mr. Vice Chair, um, I understand the talking points that you're trying to hit, but it's just. Complete apples and oranges comparison, uh, taking care of our veterans is an extraordinary priority, I think, for everyone on this diet. All of us have incredible respect for, uh, the members and, uh, the men and women who have served our nation in uniform. Many of us count them as family members, people in our communities, dear friends. Uh, we have actually as *** legislature added in additional money to invest in our veterans to support them and uplift them. Now that is just one small part of the much bigger pie that is the state spending plan. Lawmakers are supposed to finalize the vote on this, um, whole plan by at around 6 o'clock tonight within the next hour, and the governor is expected to sign it by the end of tonight. We are working on *** web story that will show you *** lot of the things that this budget includes so that we can read it and you can see what's going on. Yeah, I know *** lot of our budget also has to do with AI and relies on how well AI is doing. So the governors announced today *** new deal with anthropic, of course AI. Company that allows state agencies to use its AI technology at *** discount. How much is that going to cost and is that also *** part of the budget? Yeah, we've actually posed these questions to Governor Kevin Newsom's office. They did not immediately say whether this is part of the state budget this year. It's my understanding right now in this very moment it's not, but uh, yeah, as far as the dollar amount goes for that new AI technology for state agencies, it's really not clear. I'll also note in the LAO's analysis of. Why our state spending has grown, uh, $9 billion of it is because of state operations. *** lot of that having to do with IT. Now how much this adds to those costs we'll see. I can't imagine. I, I mean, I'm not an expert in this, but probably in the millions of dollars. But I mean when you're, you're getting new software for all these different agencies and our government is so big that will add up. So we're still waiting to see the cost. Maybe we'll have it within the next hour or so and of course we can find all of that online. yep, Ashley, thank you so much.
Updated: 8:01 PM PDT Jun 29, 2026
California lawmakers and the governor on Monday night approved how exactly they plan to use taxpayer dollars for the upcoming year, a budget plan that has grown significantly since Gov. Gavin Newsom took office. The new state budget takes effect July 1 and marks the largest state spending plan in California's history at $351.7 billion, $251 billion of which is from the state's general fund. California’s state budget for the upcoming year marks a 40% increase in state spending, a percentage adjusted for inflation, since Newsom took office. It's a rate that has outpaced inflation and income growth of all Californians since 2019.State financial experts from the Department of Finance and the Legislative Analyst’s Office said Monday the growth is mainly due to increased spending on education and health and human services. California’s Legislative Analyst’s Office published an analysis of the state’s growing budgets and found that 70% of the spending growth has been focused on sustaining and paying for state programs established before Newsom took office. Under Newsom, spending has increased by $37 billion for community colleges, $25 billion for Medi-Cal, and billions more for the Department of Developmental Services, in-home supportive services, childcare, and universities. The analysis also found the state has spent $9 billion more on State Operations, including IT services. MediCal, California’s health insurance program for lower-income residents, has been expanded under Newsom to cover more people, including undocumented immigrants. Lawmakers and the governor appropriated a total of $220 billion for the program this upcoming year, $46 billion from the state's general fund. This year’s budget includes coverage for about 2 million undocumented immigrants on MediCal, which is expected to use about $12 billion of those funds. While undocumented adults ages 19-65 are not currently eligible to sign up, undocumented children and seniors can access the program. Starting in July 2027, the state will implement a monthly fee of up to $50 for enrollees with "unsatisfactory immigration status." The analysis also notes Medi-Cal costs have increased to cover enrollees generally because providers' rates and pharmacy prices have gone up. In K‑12 education, expansions have included initiatives such as a new after-school program, the expansion of transitional kindergarten to all 4‑year-olds, and the arts education program approved by voters through an initiative voters passed in 2022.For community colleges, the Legislative Analyst's analysis said expansions include increases beyond inflation in general purpose funding, along with new and expanded categorical programs for purposes such as basic needs centers, student financial aid, and part‑time faculty health insurance.See more coverage of top California stories here | Download our app | Subscribe to our morning newsletter | Find us on YouTube here and subscribe to our channel | Make KCRA a preferred news source in Google
California lawmakers and the governor on Monday night approved how exactly they plan to use taxpayer dollars for the upcoming year, a budget plan that has grown significantly since Gov. Gavin Newsom took office.
The new state budget takes effect July 1 and marks the largest state spending plan in California's history at $351.7 billion, $251 billion of which is from the state's general fund.
California’s state budget for the upcoming year marks a 40% increase in state spending, a percentage adjusted for inflation, since Newsom took office. It's a rate that has outpaced inflation and income growth of all Californians since 2019.
State financial experts from the Department of Finance and the Legislative Analyst’s Office said Monday the growth is mainly due to increased spending on education and health and human services.
California’s Legislative Analyst’s Office published an analysis of the state’s growing budgets and found that 70% of the spending growth has been focused on sustaining and paying for state programs established before Newsom took office.
Under Newsom, spending has increased by $37 billion for community colleges, $25 billion for Medi-Cal, and billions more for the Department of Developmental Services, in-home supportive services, childcare, and universities. The analysis also found the state has spent $9 billion more on State Operations, including IT services.
MediCal, California’s health insurance program for lower-income residents, has been expanded under Newsom to cover more people, including undocumented immigrants. Lawmakers and the governor appropriated a total of $220 billion for the program this upcoming year, $46 billion from the state's general fund.
This year’s budget includes coverage for about 2 million undocumented immigrants on MediCal, which is expected to use about $12 billion of those funds. While undocumented adults ages 19-65 are not currently eligible to sign up, undocumented children and seniors can access the program. Starting in July 2027, the state will implement a monthly fee of up to $50 for enrollees with "unsatisfactory immigration status."
The analysis also notes Medi-Cal costs have increased to cover enrollees generally because providers' rates and pharmacy prices have gone up.
In K‑12 education, expansions have included initiatives such as a new after-school program, the expansion of transitional kindergarten to all 4‑year-olds, and the arts education program approved by voters through an initiative voters passed in 2022.
For community colleges, the Legislative Analyst's analysis said expansions include increases beyond inflation in general purpose funding, along with new and expanded categorical programs for purposes such as basic needs centers, student financial aid, and part‑time faculty health insurance.
See more coverage of top California stories here | Download our app | Subscribe to our morning newsletter | Find us on YouTube here and subscribe to our channel | Make KCRA a preferred news source in Google