California’s budget deficit has grown. Here’s how Gov. Newsom is responding (2024)

Good morning. It’s Tuesday, May 14. Here’s what you need to know to start your day.

• The state’s budget shortfall is larger than first projected.
• California faces the consequences of the Golden State exodus.
• $15 budget? Check out these restaurants.
• And here’s today’s e-newspaper

California’s budget deficit has grown. Here’s how Gov. Newsom is responding

Gov. Gavin Newsom released his revised $288-billion budget proposal last week, which included a bleak update on the state’s deficit: It has grown from earlier projections.

Back in January, state officials announced they were bracing for a $37.9-billion shortfall. Now that expected deficit stands just shy of $45 billion.

To address the gap, state officials aim to shrink California’s government. That includes “significant spending cuts” through reduced programs, a pause on many new investments and permanently eliminating about 10,000 vacant state jobs.

The cuts hamper Newsom’s progressive policy agenda, The Times’ Taryn Luna, Mackenzie Mays and Anabel Sosa reported, in part by “pausing an expansion of subsidized childcare and cutting billions in funding for climate change programs.”

“The grim forecast was driven by lower than projected state revenues, continuing a pendulum swing from the fiscal boom of the COVID-19 pandemic,” they explained last week.

Which programs are facing cuts?

Newsom is proposing one-time or ongoing reductions for 260 different government programs. This chart of proposed general fund expenditures shows deep cuts in almost every category. That includes:

• Slashing $3.6 billion from programs related to fighting climate change
• Cutting $2 billion over two years from a program to expand internet connectivity in underserved communities
• Terminating the Foreclosure Intervention Housing Preservation Program by eliminating nearly $475 million in current and earlier proposed funding
• Cutting $260 million from a round of Homeless Housing, Assistance and Prevention grant program funds, plus eliminating $325 million in current and earlier proposed funding for the Multifamily Housing Program
• Eliminating $52.5 million in 2023-24 and $300 million in ongoing funding for state and local public health programs
• Reducing $268.5 million over four years from the Department of Toxic Substances Control’s Cleanup in Vulnerable Communities Initiative Program
• Cutting $399 million in Active Transportation funding through 2026-27

That totals $19.1 billion in cuts for one-time spending and $13.7 billion in cuts or for ongoing spending over the next two fiscal years (2024-25 and 2025-26).

“None of this is the kind of work you enjoy doing, but you’ve got to do it,” Newsom said Friday. “We have to be responsible. We have to be accountable.”

Newsom’s “unusual maneuver” for education funding could be a point of contention as the Legislature negotiates with him this summer.

Taryn, Mackenzie and Anabel report that the governor is proposing a move to lower funding minimums for 2022-23 “to reflect the lower-than-expected state revenues that came in late last year.”

“The change could ultimately reduce funding for schools by tens of billions of dollars in future years and launch a monumental fight over education funding at the state Capitol,” my colleagues wrote.

An ‘incomplete’ plan and a Roman holiday

Back in January, Newsom said the “prime-time” event would come when he released his May revision. But Times reporters noted that the plan was “incomplete” when compared to revisions in prior years.

“The administration provided only a 50-page summary of his proposal, compared to the more detailed, 260-page document Newsom released in January,” they wrote.

Newsom was initially scheduled to present the revision today, but moved the event up to Friday so he could travel to Rome today, where he’s set to speak during a climate conference at the Vatican.

Go here to read through Newsom’s thinner-than-usual May budget revision. More details on the revised budget are supposed to be available to the public today.

Today’s top stories

California Exodus

• California exodus left a gaping population hole that will take years to reverse.
• Why Californians are fleeing this once-Golden State.

Rebecca Grossman

• D.A. removes Rebecca Grossman’s prosecutors, outraging parents of murdered boys.
• Rebecca Grossman was found guilty of murder in the killing of two young brothers. She vows to appeal.

Politics

• Biden, Trump head to Southern California in June for big-dollar fundraisers.
• Planned Parenthood announces latest outside spending plan in California congressional races.
• Can Nevada voters overturn public funding for A’s ballpark? Not this year, maybe not ever.

Climate and environment

• Revelations of possible radioactive dumping around the Bay Area trigger new testing at parks.
• Flu season is over, but there is a viral surge in California wastewater. Is it avian flu?
• Series of earthquakes rattle south of U.S.-Mexico border. Shaking felt across San Diego.

Bronny James headed to NBA?

• Bronny James has been medically cleared for combine, paving way for possible NBA draft entry.
• USC players recount harrowing moments from Bronny James’ cardiac arrest.

More big stories

• The Supreme Court denies California’s plea for immunity for COVID-19 deaths at San Quentin.
• Doctors saw younger men seeking vasectomies after Roe vs. Wade was overturned.
• Sheriff’s Department official on decision to cover alleged deputy gang tattoo: ‘Embarrassed.’
• $3.3 billion available for mental health beds as Newsom kick-starts Prop. 1 spending.
• Gov. Newsom seeks faster review of insurance rate hikes. What to know.
• Where every cent of $1 goes at one L.A. restaurant, explained.
• In Acton, rural serenity is threatened by proposed battery facilities, spiking fire insurance premiums.
• What’s the deal with Jerry Seinfeld? His Duke University address sparks student walkout.
• Erewhon sues city to stop Sportsmen’s Lodge development in Studio City.
• These yogurt-covered pretzels might make you sick, FDA warns. Here’s what you need to know.
• LAUSD parents and teachers are in an uproar over timed academic testing for 4-year-olds.

Get unlimited access to the Los Angeles Times. Subscribe here.

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• Anita Chabria: Michael Cohen is boring, and that’s trouble for Trump.
• Harry Litman: Michael Cohen started testifying against Trump. Here’s what prosecutors need from him.
• Dylan Hernández: The Dodgers have good reasons to be patient, believe Walker Buehler can still dominate.
• Jonah Goldberg: Biden still trails Trump in the polls. His problem goes beyond inflation, Gaza and age.

Today’s great reads

They spent $354,000 to build a modern ADU. Now they rent it out for $4,500 a month. Building a stunning accessory dwelling unit out of a two-car garage takes ingenuity, time and money. But for these architect-owners, there were also big gains to be had.

Other great reads

• Netflix Is a Joke made L.A. laugh for 2 weeks straight. Here’s the funniest stuff we saw.
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How can we make this newsletter more useful? Send comments to essentialcalifornia@latimes.com.

For your downtime

Going out

• 🥗🍕15 L.A. restaurants and chains where a $15 budget goes far.
• 🎤Childish Gambino drops ‘Atavista,’ the ‘finished version’ of ‘3.15.20,’ and announces tour, including stops in L.A. on Sept. 18 and 19.
• 🍽️ Gudetama Cafe, devoted to Sanrio’s lazy egg, is open in Buena Park.
• 🎭 Meow Wolf, whose multiple locations of floor-to-ceiling psychedelic-leaning art have attracted about 10 million visitors across its four venues since 2016, announces its Los Angeles venue.

Staying in

• 📺 The free jazz ensemble known as Black Twitter, and how it became the subject of a new docuseries.
• 🧑‍🍳 Here’s a recipe for Kaeng Lieng (Thai vegetable soup with shrimp.)
• ✏️ Get our free daily crossword puzzle, sudoku, word search and arcade games.

And finally ... a great photo

Show us your favorite place in California! We’re running low on submissions. Send us photos that scream California and we may feature them in an edition of Essential California.

(Tayfun Coskun / Anadolu)

Today’s great photo is from Tayfun Coskun of the news agency Anadolu. Coskun caught this photo of the northern lights illuminating the sky of San Francisco‘s North Bay at China Camp Beach in San Rafael on May 11.

Have a great day, from the Essential California team

Ryan Fonseca, reporter
Kevinisha Walker, multiplatform editor and Saturday reporter
Christian Orozco, assistant editor
Stephanie Chavez, deputy metro editor
Karim Doumar, head of newsletters

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