Governor Newsom and the Legislative leadership announced an Early Action Agreement and a high-level overview of the Early Action Package which will decrease the budget shortfall by approximately $17.3 billion. This proposed agreement aims to reduce the deficit before final budget negotiations take place. The Assembly Budget Committee released an Early Action Summary, and the Senate released the “Shrink the Shortfall Agreement” highlighting their proposal.
The agreement also includes budget language authorizing the Administration to freeze additional one-time funding included in the 2021, 2022, or 2023 Budget Acts and provides the following mix of solutions as proposed in parts of the Governor’s Budget.
- $3.6 billion: Reductions (primarily to one-time funding)
- $5.2 billion: Revenues/Borrowing
- $3.1 billion: Delays
- $3.4 billion: Fund Shifts
- $2.1 billion: Deferrals
The proposals affecting education indicate robust conversations taking place amongst the legislature and the administration in anticipation of a facilities bond measure being presented to voters in November 2024. The agreement approves the Governor’s proposal to:
- Reduce the School Facility Program by $500 million, making the total General Fund appropriations from 2022-2023 from $4.1 billion to $3.6 billion.
- Delay $550 million, in General Fund, for the Preschool, Transitional Kindergarten, and Full-Day Kindergarten facility Program.
The budget bill is set to be finalized and presented in print within the next few days, with deliberations scheduled to take place in both the Assembly and Senate Budget Committees next week. The potential for a vote on the package as early as April 11th. Concurrently, budget subcommittees will commence evaluations to determine potential cuts to ongoing programs as a proactive measure to mitigate the state’s anticipated structural deficit in the years ahead. It’s anticipated that further budgetary adjustments will be necessary in 2025.