Governor Newsom Proposes New Fiscal Year Budget

Governor Newsom unveiled his Proposed Budget on January 8^th, outlining his budgetary and policy priorities for the coming fiscal year. Following upon a tumultuous economic year with a $54 billion deficit, this year’s budget paints a rosier picture with a proposed $227 billion “balanced” spending plan, $22 billion in budget reserves and a one-time $15 billion budget surplus. This does not, however, reflect the $7.6 billion structural deficit projected for 2022-2033—one that will grow to $11 billion in 2024-2025. Below is a brief synopsis of proposed expenditures and policy changes offered in the Governor’s budget:

$ 6.7 million one-time General Fund ($3.35 million in the current year and $3.35 million in July 2021) with the University of California Cooperative Extension to provide technical assistance and grants to small, mid-sized and underserved farmers; this assistance may include business planning, compliance, and accessing state and federal funds
$8.7 million in federal funds and 24 positions at the Department of Food and Agriculture to implement the Food Safety Modernization Act
Climate smart agriculture funding (see the Climate Change section below)
$40 million General Fund for the State Water Efficiency and Enhancement Program (see the Water section below)
$6 million General Fund ($4 million for current year and $2 million in July 2021) to do an assessment of EPA/CDFA regulations and identify opportunities to streamline regulations, reporting, and develop a unified licensing portal for program regulation and payment
Proposed extension of the Carl Moyer Memorial Air Quality Standards Attainment Program (Carl Moyer Program) which provides grant funding for cleaner-than-required engines, equipment, and other sources of air pollution with the State Air Board and local air districts until 2024
Allow the Department of Industrial Relations to increase budget by $14.4 million and position allocations by 70 to hire additional Cal/OSHA inspectors
Provides $8.6 million and 43 positions to allow access to workers comp benefits under SB 1159 and investigate workplaces that violate COVID-19 specific guidelines and regulate businesses for adequate personal protective equipment stockpiles for future crises
Establish a new Department of Better Jobs and Higher Wages compromised of several existing Labor Workforce Development Act agencies involved in job training, labor market information, and apprenticeship programs
Replacing the current pesticide mill assessment structure (which is non-discriminatory on pesticide type), with a risk-based assessment strategy that charges a higher mill for higher risks (i.e. those pesticides with no classification or a ‘caution’ classification would go from 21to 26 mills, ‘warning’ would go to 40 mills and ‘danger’ would go to 45 mills)
$54 million in Cap and Trade expenditures ($30 million in current year and $24 million in July 2021) for the Safe and Affordable Drinking Water fund
$60 million in one-time General Fund ($30 million in current year and $30 million in July 2021) to DWR for implementation of the Sustainable Groundwater Management Act (SGMA) to support economic mitigation planning and implementation projects