A recap of the FY 2021-22 State Budget from the Urban Counties of California is as follows:
Budget Committees Adopt Unified Legislative Budget Plan; Negotiations Between Legislative Leaders and Governor Begin
On Tuesday, June 1, Senate President pro Tempore Toni G. Atkins (D-San Diego), Assembly Speaker Anthony Rendon (D-Lakewood), Senate Budget and Fiscal Review Committee Chair Nancy Skinner (D-Berkeley), and Assembly Budget Chair Phil Ting (D-San Francisco) announced an agreement on a joint State Budget Proposal.
Subsequently, the full budget committees met concurrently to adopt a parallel and largely unified approach to the 2021-22 state spending plan. As posted at the links below, the budget committees adopted hundreds of individual subcommittee actions – some consistent with the Governor’s January and/or May budget proposals, some that revised or rejected the Governor’s proposal, and others reflecting wholly new legislative spending.
Among the most notable differences are providing Medi-Cal to undocumented immigrants at age 50 instead of 60 and giving health departments the $200 million they requested. The legislative proposal relies on the Legislative Analyst Office's revenue forecast, which anticipates about $4 billion more in the next budget year — but $20 billion more than Governor Newsom assumed in 2024-25. Democrats believe they can stay under the state appropriations limit, better known as the "Gann Limit," by treating the $8.1 billion in Golden State Stimulus checks as lower revenues on the balance sheet rather than as an expenditure.
Legislative Democrats also say their budget "maximizes flexible federal funds" more than the Governor did in his budget.
- Health and Human Services | link
- Education | link
- Climate, Resources, Environment, and Transportation | link
- State Administration and General Government | link
- Public Safety, Judiciary, and Corrections | link
With these actions, legislative leaders have endorsed a shared budget framework and now begin negotiations on areas in which their spending plan differs from that of the Governor’s May Revision. The Legislature’s proposed budget package does not address details necessary to fully enact the 2021-22 budget; rather, it offers a high-level spending plan and recognizes that further negotiations and refinements are needed on a number of big-ticket items likely dealt with post-June 15, including homelessness, water, energy, and children’s behavioral health.
The Budget Conference Committee will not be a feature of this year’s budget process. Behind-the-scenes negotiations between the Newsom Administration and leaders in both houses are expected to take place. The 72-hour in print rule means that the Budget and any trailer bills on which the Legislature must act needs to be in print three days prior to any votes cast. With the immutable June 15 budget deadline, the houses have until June 12 to publish bill provisions.
Given the considerable number and depth of the policy issues deferred until after June 15, expect to see several more rounds of “budget bill juniors” (measures to make appropriations beyond the main budget bill that will have to be passed by June 15) and plenty of additional trailer bills.
All told, the updated Legislature’s Version contains total spending of $267.1 billion, of which $196.1 billion is from the General Fund, and total General Fund reserves equaling a record $25.2 billion. Total Proposition 98 spending is a record, $96.1billion, including $69 billion from the General Fund.
As we await information regarding final negotiations, a few select actions – grouped by subcommittee jurisdiction – from the Legislature’s budget package are as follows:
Health and Human Services
Public Health
The Legislature’s spending plan includes notable ongoing investments in public health, including $475.1 million in 2021-22 and $403 million annually thereafter to rebuild an equitable public health system. A detailed summary of the public health plan can be found here. Investments include the following:
- $200 million annually to support local health jurisdictions, including a three-year public health planning process beginning July 1, 2022.
- $35 million annually to support workforce development programs to recruit, expand, and retain a modern public health workforce.
- $115 million annually to support health equity and racial justice interventions including $100 million for grants to community-based organizations to address health disparities and $15 million for the Transgender Wellness and Equity Fund.
- $40 million annually to support Department of Public Health (DPH) statewide coordination and planning, including technical assistance to counties, IT system upgrades, triennial study of public health workforce gaps, annual study of progress on addressing health disparities, and other annual reporting.
- $3 million to support a public health infrastructure study to inform the triennial public health plans by July 1, 2022.
- $63.1 million one -time to support Phase II of the California Reducing Disparities Project.
- $13 million ongoing and $6 million one-time to support investments to end the epidemics of HIV/AIDS, hepatitis C, and sexually transmitted infections.
Lanterman-Petris-Short (LPS) Conservatorships
The legislative budget rejected the Governor's May Revision proposal to halt intake and release LPS conservatees at State Hospitals. Conversations are ongoing between the state and counties on alternatives.
In-Home Supportive Services (IHSS)
The Legislature’s budget includes a penalty of 10% on a county that fails to reach a collective bargaining agreement for IHSS providers.
Adult Protective Services
The Legislature’s budget would provide $70 million General Fund ongoing to expand Adult Protective Services to serve adults ages 60 and older.
Families First Prevention Services Act (FFPSA)
The Legislature provided an additional $100 million ongoing on top of the Governor’s May Revision proposal of $148 million for county implementation of FFPSA.
Addressing Complex Care Needs of Foster Youth
The Legislature provided an additional $100 million ongoing to meet the complex care needs of foster youth returning from out-of-state placements on top of the May Revision proposal of $42.1 million ($39.2 million General Fund).
Legislative Homelessness Package
The Legislature adopted a multi-year homelessness package to include investments over multiple years as detailed below.
For the 2021-22 budget year:
- $1.2 billion federal American Rescue Plan Act (ARPA) funds for Project Homekey
- $1 billion for flexible local assistance with “robust oversight and accountability requirements” that are yet to be determined
- $40 million for Family Homelessness Challenge Grants and Technical Assistance
- $30 million for Encampment Resolution Grants
- Additional investments in a variety of health and human services programs to prevent individuals and families from becoming homeless and assisting those at risk of homelessness
For the 2022-23 budget year:
- $1 billion federal ARPA funds for Project Homekey
- $1 billion for flexible local assistance with the same oversight and accountability requirements
- Additional investments in a variety of health and human services programs to prevent individuals and families from becoming homeless and assisting those at risk of homelessness
For 2023-24 and 2024-25:
- An additional $1 billion per year in flexible local assistance funding
While the Senate and Assembly budget committees approved this framework, trailer bill details (such as the allocation methodology) will likely need to be developed over the summer.
Public Safety, Judiciary, and Corrections
Dependency Counsel Augmentation
As part of a larger package of access to justice investments, the Legislature adopted a two-part augmentation to dependency counsel funding.
For the 2021-22 budget year:
$10 million in one-time funding to address pandemic-related caseload spikes and operational expenditures
For the 2021-22 budget year and ongoing:
Up to $30 million to address any shortfall associated with the drawdown of federal funding.
Fine and fee forgiveness/elimination; AB 1869 (2020) backfill methodology
The Legislature rejected the Governor’s May Revision proposal to dedicate $300 million in one-time federal ARPA funds to (1) support additional relief for low-income individuals who owe fines and fees associated with traffic and non-traffic infractions issued between January 1, 2015 and June 30, 2021 and (2) backfill counties and courts for associated revenue loss.
Instead, the Legislature adopted the following multi-part approach to addressing the impacts of court-ordered debt:
- Adopt placeholder trailer bill language to determine the allocation schedule for the $65 million backfill provided for five years pursuant to AB 1869, the 2020 trailer bill that eliminated approximately two dozen criminal justice administrative fees and vacated previously levied debt;
- Adopt placeholder trailer bill language for a new set of criminal administrative fees and the civil assessment fee
- Appropriate the following amounts to provide for a county and court backfill associated with the proposed elimination of the new set of fines and fees: $151 million each in 2021- 22 and 2022-23, $130 million in 2023-24, and $120 million in 2024-25 and thereafter.
In separate but related action, the Legislature also rejected the Governor’s January proposal to expand a court-based ability-to-pay program.
Statewide expansion of pretrial pilot programs
The Legislature rejected – and took no action to offer an alternative – the Governor’s May Revision proposal to invest $140 million in 2021-22 and $70 million ongoing to expand pretrial services pilot programs statewide.
Office of Youth and Community Restoration
The Legislature increased funding to $30 million (as compared to approximately $7 million in the Governor’s proposal) in support of the OYCR, which – pursuant to the provisions in the 2020 DJJ Realignment measure (SB 823) – will be established on July 1, 2021 within the state’s Health and Human Services Agency. Related actions include adoption of placeholder trailer bill language to clarify and expand the role and duties of the office.
CDCR Deferred Maintenance and Future Prison Closures
In connection to the Administration’s proposed investments to address prison facility deferred maintenance, the Legislature approved the associated funding contingent upon the adoption of trailer bill in the final budget agreement requiring CDCR to create and adopt a long term prison infrastructure investment plan and prison closure plan.
Enhanced Jail Inspections
The Legislature’s budget rejected the Administration’s proposal to authorize 14 new positions at the Board of State and Community Corrections (and $2.9 million in associated funding) to strengthen jail oversight and inspections. Associated action includes approval of $150,000 ongoing to support electronic data entry and the adoption of placeholder trailer bill language to authorize unannounced detention facility inspections.
Public Defender Funding
The Legislature’s budget includes the following new investments to support workload in public defender offices, alternative public defender offices, and other alternative offices providing indigent criminal defense services: $50 million in 2021-2022, $50 million in 2022-23, and $50 million in 2023-24.
Legislative Updates:
According to Politico, 790 Assembly bills passed before the June 4 house of origin deadline, meaning that 49.6% of the 1,593 Assembly bills introduced this year made it out on time. On the Senate side, 549 out of its 828 introduced bills continue moving, which is a 66.3% success rate. Five Assembly bills failed passage on the floor and 34 were moved to the "inactive file," while one Senate bill failed passage and 59 were moved to inactive. Committee hearings the week of June 7 are generally not the highest-profile bills approved by the house of origin deadline but, rather, non-fiscal bills that did not have to go through the Appropriations committees suspense files. The Assembly will hold seven policy committee hearings, while the Senate is convening twelve. July 14 is the last day for policy committees to approve bills, just before the one-month summer recess begins on July 16.
Newsom Administration Assures Brown Act Flexibility Beyond June 15
On June 2, 2021, representatives from the Office of Governor Gavin Newsom assured local agency associations that Brown Act flexibilities provided during the COVID-19 pandemic to local governing bodies, boards, and commissions via Executive Order would continue beyond the state’s anticipated June 15 re-opening. This assurance comes after a coalition of local agency associations formally requested that the Governor consider providing a period of transition back to in-public meetings prior to repeal of relevant executive orders.
Communication from the Newsom Administration indicated that the Governor intends to terminate pandemic-related executive orders at the earliest possible date when conditions warrant, but also that he recognizes the importance of an orderly return to in-person state and local public meetings. As a result, the Administration will work to provide notice to affected stakeholders in advance of repeal of relevant executive orders. Until a further order is issued, local agencies may continue to rely on existing orders.
The Governor did confirm at a press event that he intends to keep California under a state of emergency – both for administrative (such as FEMA reimbursements) and public health (responding to another outbreak) purposes – even after the state broadly reopens on June 15.
Update on “Hot” Bills
AB 650, by Assembly Member Al Muratsuchi, would have required public and private health care providers, including hospitals and clinics, to pay hazard pay retention bonuses to the health care workforce. The measure was not taken up for a vote before the Legislature concluded its business for the week, effectively meaning the bill is dead because it failed to move out of the house of origin before the June 4 deadline. Please note that the sponsor – Service Employees International Union State Council – held a press conference with Assembly Member Ash Kalra to push for the inclusion of funding in the state budget for hazard pay for health care workers. The Legislature’s budget framework does not include funding for this purpose.
Similarly, SB 213, by Senator Dave Cortese, was not taken up for a vote before the Legislature adjourned. The measure would have created rebuttable presumptions that infectious disease, COVID-19, cancer, musculoskeletal injury, post-traumatic stress disorder or respiratory disease are occupational injuries for a direct patient care worker employed in an acute care hospital and are therefore eligible for workers’ compensation benefits.
Other notable bills of interest to the County will be presented at the meeting of the Legislation Committee by the County's state advocate. Attachment A is the status report of the County's 2021 Priority Bills.
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