CA LEGISLATURE IS BACK: WHAT TO EXPECT IN 2022
Another coronavirus variant spreading like wildfire, and another huge state budget surplus: In some ways, 2022 is off to a similar start as 2021.
That could carry over to the state Legislature’s new session that starts today. In addition to the pandemic and surplus, California is dealing with some of the same big issues it has long grappled with — including housing and climate change.
“Our challenges continue to be the challenges that we have started and built momentum to work towards,” Senate President Pro Tem Toni Atkins, a San Diego Democrat, told CalMatters.
The difference? Looking at key issues more through a lens of equity, she said.
The state Assembly’s agenda shares those priorities, said Assembly Speaker Anthony Rendon, a Lakewood Democrat. Access to health care will be another focus: “We’re proud of where we are as a state, but we need to make sure that everybody in the state is covered.”
Where will things look a little different? The state Capitol complex is undergoing renovations, which means the “Bacteria Bear” is safely in storage for now.
The public and press will be allowed to attend in person, but due to COVID, access and seating will continue to be limited, masks and social distancing will be required and meetings will continue to be livestreamed. “We had hoped that as we go back, we’d be through the pandemic, but it hasn’t gone away,” Atkins said. “We’re going to have to continue to bear that in mind.”
There’s also the makeup of the Legislature itself. Following the redistricting process after the 2020 census, state Senate and Assembly district lines have been shaken up — and a number of lawmakers will be lame ducks this session because they’re not running for re-election in 2022.
Here are four themes to watch in the new legislative session:
Compared to the $76 billion surplus from 2021, California is projecting a $31 billion surplus in the general fund, plus $20 billion in Proposition 98 funding for education.
The windfall is fueled, like last year, with tax revenue and federal funds. In addition, the November cap-and-trade auction generated $732 million, according to the Legislative Analyst’s Office.
In his budget proposal that is due by Jan. 10, Gov. Gavin Newsom has vowed to include more than $350 million to stop organized retail thefts, plus more money for dyslexia programs after authoring a children’s book on his own battles. He’s also hinted that he’ll include another round of stimulus checks.
Neither of the spending priority lists put out by Senate or Assembly leaders mention a stimulus check. Instead, they are framing the budget around a more inclusive economic recovery, and a more equitable economy.
Atkins said California’s economy is strong, but that wealth needs to be put to work.
“Those at the top are doing better than ever before, and that’s good for California in terms of our revenue,” Atkins said in an interview. “But as strong as the economy is, we face a homelessness crisis that you see every day in every corner of the state. And we know how hard it is for everyday, ordinary families to get by.”
The Senate plan builds on 2021 programs, including targeted relief such as the child tax credit, Earned Income Tax Credit and small business aid.
Senate and Assembly leaders also say they will seek to put more money into K-12 schools and higher education, and to maintain the state’s reserves — “to protect the progress we are making from future downturns,” Atkins said.
Last year, the Legislature was able to maintain $25 billion in reserves.
“As strong as the economy is, we face a homelessness crisis that you see every day in every corner of the state. And we know how hard it is for everyday, ordinary families to get by.”
Rendon said that the budget surplus would enable California to “rebuild infrastructure in every corner of the state.” Meanwhile, Senate Republicans are calling for $3.3 billion to be spent on water projects, most for the contentious Sites Reservoir.
Expending one-time funds on infrastructure would help the Legislature avoid exceeding the Gann Limit, which requires that when the state hits a spending revenue threshold two years in a row, the excess money must be reimbursed to taxpayers or spent on schools. Revenue spent on building reserves and paying off debt is excluded from the limit.
Jason Sisney, Rendon’s budget advisor, noted that the Gann limit did not kick in last year, despite the historic surplus.
Assembly Budget Chairperson Phil Ting, a San Francisco Democrat, told reporters last month that with less money than last year to expand programs, the Legislature is likely to employ more creative onetime funding measures, including on transportation and transit, which didn’t receive as much funding in 2021.
“We’re definitely not back towards normal, but as we sort of come out of the pandemic a little bit, it’s not exactly clear where the best investments are and where the biggest impact is,” Ting said. “This is what the budget process is for. We have from now ’til June to really identify where we can make the biggest impact.”
And while there is a budget surplus, Rendon said one challenge this year is