June 13, 2017 (SACRAMENTO) The office of the governor and the legislative leaders announced an agreement on the state budget. This is important since we are nearing the beginning of the new fiscal year.
“This budget keeps California on a sound fiscal path and continues to support struggling families and make investments in our schools. We’ve come together on this balanced and progressive budget and I’m confident that we can do the same to extend our critical cap-and-trade program,” said Governor Brown.
“This state budget will keep California strong, protect our fiscal stability and empower our communities at a time when Washington is determined to undermine them. This budget makes historic investments in healthcare, education, and childcare, and lays down a multi-billion dollar investment to start fixing our roads and infrastructure. This is how government works – by the people and for the people,” said Senate President pro Tempore de León.
“This is a budget that does things for people, not to people. It is a combination of fiscal responsibility, including the biggest reserves in state history, major spending improvements to fight poverty and improve education, and significant reforms stemming from our strong oversight of the Board of Equalization and the University of California,” said Assembly Speaker Rendon.
The package adds $1.8 Billion to the state rainy day fund, bringing it to a total of $8.5 billion for the 2017-18 fiscal year. It also expands the California Earned Income Tax Credit, bringing it in line with the federal standard. In addition, it expands income ranges to help families working up to full-time at the newly increased minimum wage benefit from the program. The expansion makes more than 1 million more households eligible to claim the credit. For the 2015 tax year, almost 400,000 households claimed the credit.
Funding for K-14 schools is expected to grow by $3.1 billion over the revised 2016-17 level to $74.5 billion in 2017-18 – an increase of $1.0 billion since January and $27.3 billion over six years, or 58 percent.
The budget includes supplemental payments to the California Public Employees’ Retirement System (CalPERS) with a loan from the Surplus Money Investment Fund, a step that is expected to save the state $11 billion over the next two decades while continuing to reduce unfunded liabilities and stabilize state contribution rates. The state will achieve these savings and reduce these liabilities by leveraging existing resources, without the cost or risk of external borrowing.
The budget accelerates $2.8 billion toward improving commutes, fixing roads, strengthening overpasses and bridges and building mass transit. While the Federal Government wants to replace the Affordable Care Act, the state of California will continue its large investments in the Medi-Cal program – including new revenue from Proposition 56 – to serve millions of people who rely on this program for health care.