California Budget Historically Flush but Disagreements Delay Implementation

The California Senate and Assembly have agreed upon a two-party budget proposal, and they sent a bill (SB 154) down to the Governor on Monday June 13th. This budget is really just a placeholder to make sure that the legislature meets it is June 15 constitutional deadline and so  that the state controller continues to pay lawmakers, while they hash out more specific details with Governor Newsom. The governor still has some significant spending disagreements with the Legislature. For example, certain elements of his taxpayer inflation relief plan including the gas tax rebate is not put to bed yet.  The Governor wants every vehicle owner to get paid $400 for each registered vehicle up to $800 cap. The Legislature wants to provide rebates to all taxpayers but means tested so that the “wealthy” get zero $. It is unclear how quickly they will get those details agreed upon and sorted out, but it will be pretty quick. 

 It is highly that there will be a three-party agreement between the Assembly, Senate, and the Governor within a matter of days. And when that happens, we will start seeing a lot of the budget trailer bills pass. We still do not know if they are going to process members request now or in August when they come back from Summer recess. There are a lot of individual members requests being considered as “projects of regional concern” and many Capitol lobbyists are paying close attention to the budget progress.