Today, May 13, 2022, Governor Newsom released the May Revision, which projects revenues nearly $55 billion above his January budget proposal. Additionally, economic growth is expected to continue at a slightly slower rate than was projected at the time of the governor’s January budget proposal. For the 2022-23 fiscal year, General Fund revenues are expected to total $219 billion.

The Legislature has until June 15, 2022, to adopt a state budget. To read the full Governor’s May Revision 2022-23 Budget Report, click here.

Additional details will be released as part of the trailer bill language in the coming days and weeks. CASBO will analyze the Newsom Administration’s latest budget proposals and provide recommendations and position statements during this final phase of the budget deliberation process. Below you will find additional materials.




Proposition 98
The budget projects Proposition 98 funding levels from the 2020-21 through 2022-23 fiscal years to increase by $19.6 billion over the level estimated in the governor’s proposed budget. Test 1 is projected to be operative for those fiscal years. The governor’s budget had proposed re-benching the Test 1 percentage due to the expansion of transitional kindergarten (TK) and expected increase in enrollment. The May Revision updates the increased Test 1 percentage from approximately 38.4% to approximately 38.3%.

The significant increase in state revenues projected for 2020-21, 2021-22 and 2022-23 results in a corresponding increase in resources for K-14 schools. Proposition 98 is estimated to be:

  • $96.1 billion in 2020-21,
  • $110.2 billion in 2021-22, and
  • $110.3 billion in 2022-23.

As noted above, this represents a three-year increase in the minimum guarantee of $19.6 billion over the level estimated in the governor’s budget. These funding levels include property tax decreases of $32 million in 2020-21, $659 million in 2021-22 and $804 million in 2022-23.


Proposition 98 Rainy Day Fund and Local District Cap on Reserves
The May Revision updates the projected total payments to the Public School System Stabilization Account between 2020-21, 2021-22 and 2022-23 from the Governor’s Budget total of $9.7 billion to $9.5 billion. The decrease is due to the decrease in capital gains revenues as a share of total funds.

The statutory cap of 10% on school district reserves will become effective beginning in 2022-23. The cap applies in fiscal years immediately succeeding those in which the balance in the account is equal to or greater than 3% of the total K-12 share of the Proposition 98 Guarantee. The balance of $7.3 billion in 2021-22 triggers school district reserve caps beginning in 2022-23.


School System Fiscal Stability

Local Control Funding Formula (LCFF)
The May Revision acknowledges the costs associated with the policies below are estimated to be $3.3 billion ongoing Proposition 98 General Fund and $463 million one-time Proposition 98 General Fund:

  • Updates the cost-of-living (COLA) adjustment to 6.56% for 2022-23.
  • Includes $2.1 billion ongoing Proposition 98 General Fund to increase LCFF base funding to help address the fiscal impacts of rising pension obligations, increased costs for goods and services, and other ongoing local budget concerns.
  • Includes $101.2 million ongoing Proposition 98 General Fund to augment LCFF funding for county offices of education (COEs), which face similar cost pressures to school districts and charter schools.
  • Includes further fiscal protections for schools that experienced significant attendance declines in 2021-22 due to the impacts of the delta and omicron surges.
  • Proposes allowing all classroom-based local education agencies (LEAs) to be funded at the greater of their current year average daily attendance (ADA) or their current year enrollment adjusted for pre-COVID-19 absence rates in the 2021-22 fiscal year, enabling LEAs to use a modified version of 2021-22 ADA to determine their 2021-22 LCFF allocations.
  • Proposes further modifying the three-year rolling average to conform with the adjustment.

Discretionary Block Grant
The May Revision includes $8 billion one-time Proposition 98 General Fund in discretionary funds to address increased operational costs and respond to external pressures. These funds are allocated on a per-pupil basis. There is also specified intent that these funds will be used for purposes that include, but are not limited to, protecting staffing levels, addressing student learning challenges, and supporting the mental health and wellness needs of students and staff. It is not clear if these funds will go to only school districts or if to charter schools and COEs.


Student Centered Schools

Expanded Learning Opportunity Program (ELOP)
The May Revision adds $403 million ongoing Proposition 98 General Fund, bringing the ongoing ELOP to $4.8 billion and full funding implementation (four years ahead of schedule) of $2,500 for every low-income, English-language-learner and foster-care youth student in the state.

Community Engagement Initiative
The May Revision adds $100 million one-time Proposition 98 General Fund to expand the program to additional LEAs.

Community Schools Partnership Program
The May Revision proposes adding an additional $1.5 billion one-time Proposition 98 General Fund to expand access to the community school grants to every eligible LEA that opts to apply on behalf of its high-need schools.

Pre-Kindergarten (PK) Education
The May Revision includes the following investment and programmatic changes:

  • State Preschool Family Fee Waivers: Provides $10.8 million one-time Proposition 98 General Fund for the 2022-23 school year and $10.8 million one-time non-Proposition 98 General Fund to waive the family share of cost for children participating in the State Preschool Program.
  • State Preschool Funding Hold Harmless: Allows State Preschool Program contractors to receive full funding allocated to them pursuant to their contracts, regardless of student attendance.
  • State Preschool Program Adjustment Factors for Students With Disabilities and Dual Language Learners: Adds $4 million for a total of $201.8 million Proposition 98 General Fund and adds $30 million for a total of $140.6 million General Fund.
  • Local Assignment Option for TK Teachers: Temporarily allows qualified teachers to teach TL until June 30, 2026. Qualified means:
    • holds a preschool teaching permit,
    • holds a bachelor’s degree,
    • meets basic skills requirement, and
    • is enrolled in coursework leading to assignment as the teacher of record in a credential.

The May Revision also adjusts the cost to expand eligibility for TK from $639.2 million to $614 million General Fund, creating a $25.2 million reduction.

Child Nutrition
The May Revision adds $611.8 million ongoing Proposition 98 General Fund for the state meal reimbursement rate to maintain reimbursement rates beginning in 2022-23. It also shares that if the federal waiver is extended, any unused state funding for rate increases in 2022-23 would instead be made available for school kitchen infrastructure grants.


Well-Prepared Educator Workforce Investments

Teacher and School Counselor Residencies
The May Revision provides $500 million one-time Proposition 98 General Fund to expand residency slots for teachers and school counselors. It also proposes a statute to expand eligibility for the Golden State Teacher Grant Program to school counselor, social worker and psychologist candidates.

Educator Support for Science, Technology, Engineering and Mathematics (STEM) Instruction
The May Revision includes $85 million one-time Proposition 98 General Fund to create PK through grade 12 educator resources and professional learning to implement STEM instruction and support the alignment of other state STEM educator support initiatives. It also includes $300 million one-time Proposition 98 General Fund for LEAs to prioritize STEM educator support and professional learning through the Educator Effectiveness Block Grant.

The May Revision also provides, over a three-year period, $15 million one-time General Fund to continue the work focused on computer science and $15 million one-time Proposition 98 General Fund focused on support for special education and English-language-learner students in the Educator Workforce Investment Grant Program.

Developmental Disabilities Screening
The May Revision provides a reminder of the creation of the dyslexia screening tool. Once these tools have been validated, the Newsom Administration intends for all educators across the state to have access to them, be broadly utilized, and be trained in how to use them appropriately to identify students with dyslexia and other processing disorders.


K-12 School Facilities

K-12 Facilities
The May Revision adds $1.8 billion General Fund to support new construction and modernization projects through the School Facility Program with the following allocation:

  • $2.2 billion one-time General Fund in 2021-22,
  • $1.2 billion one-time General Fund in 2023-24, and
  • $625 million one-time General Fund in 2024-25.

The new $1.8 billion would begin in 2023-2024, assuming the $3.9 billion is sufficient to be sustained for 2021-22 and 2022-23.

The May Revision also includes approximately $1.8 billion one-time Proposition 98 General Fund for deferred maintenance and assumes the Office of Public School Construction continues to process applications according to its existing capacity. Every district or charter school that is in a district owned facility would get a minimum of $100,000 and the reminder would be distributed to LEAs and county offices based on unduplicated pupil counts.

Major K-12 Budget Adjustments
This section highlights the budget’s significant adjustments to various educational programs outside of LCFF.


Other Significant Adjustments


Child Care

The May Revision includes $6.3 billion ($2.7 billion General Fund) for child care programs, including continued support for a multi-year commitment to rate increases and supplemental funding to providers in the first collective bargaining contract ratified last year. It also continues the commitments to expand child care access by 200,000 slots by 2025-26 by including:

  • $270 million for 36,000 additional subsidized slots compared to 2021-22.
  • $413million to support a full year of rate increases while striving toward a single reimbursement rate structure while supporting positive learning and developmental outcomes for children.

Temporary Extension of Child Care and Preschool Family Fee Waivers
The May Revision includes $136 million one-time federal funds for the California Department of Social Services and $21.3 million one-time General Fund ($10.8 million Proposition 98 General Fund, $10.5 million General Fund) for the California Department of Education to waive family fees for state-subsidized preschool and child care and development services from July 1, 2022, through June 30, 2023.

Significant Adjustments


Youth Behavioral Health

Addressing Needs and Emergent Issues in Children’s Behavioral Health
The May Revision includes $290 million General Fund one-time investments to implement a multi-pronged approach to address the urgent youth mental health crisis. The funding will also establish a center for innovative new technologies to improve youth mental health.

Youth Suicide Prevention Program
The May Revision includes $40 million General Fund to develop and implement a data-driven, targeted and community-based youth suicide prevention program for those at increased risk.

Crisis Response
The May Revision includes $50 million to provide grants to pilot school and community-based crisis response and supports following a youth suicide or attempt, as well as pilot a new approach of designating youth suicide and attempts as a reportable public health event, which would trigger screening and resource connections at the local level.


Support Wellness and Build Resilience of Children, Youth and Parents

The May Revision includes the following programs and investments to support wellbeing:



Early Start Eligibility: Developmental Delay Thresholds and Fetal Alcohol Syndrome
The May Revision includes $6.5 million General Fund in 2022-23, increasing to $29.5 million General Fund in 2024-25, to support adjustments in identifying children with qualifying signs of developmental delays. The proposal also includes statutory changes intended to engage families sooner with early intervention services, including:

  • Revising the Early Start qualification threshold from a 33% delay to a 25% delay in one of the specified assessments areas,
  • Separating communication delay assessments into expressive and receptive categories, and
  • Highlighting Fetal Alcohol Syndrome as a risk factor for intellectual and/or developmental delays.

Extreme Heat
The May Revision informs that the Extreme Heat Action Plan, as part of the Climate Resilience Package enacted in the 2021 Budget Act, was released in April 2022. Of the $300 million proposed allocation outlined in the action plan, $220 million, over two years, is to support cooling of communities at schools and through resilience centers.

Vaccine Testing
As part of the SMARTER Plan, the May Revision includes $530 million in 2022-23 to support school testing with end-to-end vendors and laboratory network costs and continue rapid testing and treatment sites.

K-12 and Interpretive Program Enrichment
The May Revision provides $15 million one-time General Fund for outdoor environmental education and access programming through the expansion of existing K-12 programs for underserved youth statewide.

K-12 ADA
The May Revision shows a percentage growth of 1.55% up from January’s percentage growth of ‑0.03%.

School Buses
The May Revision does not mention the $1.5 billion in Proposition 98 General Fund for school buses, so it is assumed that there are no changes to the program as it was seen in the Governor’s January Proposal. We anticipate seeing additional information on this through trailer bill language.


Initial Reactions From Legislative Leaders

Speaker Rendon Issues Statement on Governor Newsom’s Revised 2022-23 Budget Proposal
Assembly Speaker Anthony Rendon (D-Lakewood) released the following statement today in response to Governor Newsom’s 2022-23 revised budget proposal:

“This year’s budget is unprecedented in some of the challenges that it presents, but the Assembly has been preparing for months to meet those challenges. It helps to know we have successfully overcome past budget obstacles by offering spending plans that are balanced and meet the greatest needs for Californians,” said Speaker Rendon. “It is also reassuring to have the Senate and Pro Tem Toni Atkins as teammates for this budget process. We know how to work together to present Governor Gavin Newsom with a budget he can be proud to sign by the constitutional deadline.”

Senate Leader Atkins, Budget Chair Skinner Issue Joint Statement on Governor Newsom’s Revised 2022-23 Budget Proposal
Senate President pro Tempore Toni G. Atkins (D‑San Diego) and Senator Nancy Skinner (D‑Berkeley), Chair of the Senate Budget & Fiscal Review Committee, released the following joint statement today in response to Governor Newsom’s revised 2022-23 budget proposal:

“The budget proposals revealed by Governor Newsom this week have been encouraging. Some, like funding for reproductive health care, are parallel to the path charted in the Senate’s budget plan. Others, as happens every year, will require more discussion and negotiation. As we continue our work on the budget, we look forward to collaborating with Speaker Rendon and our Assembly colleagues on a joint Legislative budget proposal, and then discussions with the Governor that will lead to a final agreement. The bottom line is, California will have another responsible, on-time budget that provides immediate and long-term benefits to all Californians and maintains our state’s overall financial strength in case of potential downturns in the future.”