Budget deal boosts homeless programs

$139 billion state spending plan also adds millions more for universities

SACRAMENTO — Gov. Jerry Brown and legislative leaders compromised on plans to put millions more toward homeless programs and agreed to pump more money into higher education under a $139 billion general fund budget deal announced Friday.

The agreement includes about $1 billion more in additional spending than what Brown proposed last month for the 2018-19 fiscal year beginning July 1. It came one week ahead of the deadline for the Legislature to pass a state budget, which Brown has until June 30 to sign.

Democratic lawmakers and mayors of large cities had been lobbying for more funding for programs to reduce homelessness. Brown included $359 million to help local governments combat homelessness in his proposed $138 billion general fund budget in May, short of the $1.5 billion mayors wanted and the $1 billion that Democratic lawmakers were seeking.

On Friday, Brown and legislative leaders agreed to spend $600 million on pro-

grams that reduce homelessness.

“No single budget can capture all the opportunities California has or meet all the challenges we face — but the smart and sensible choices in this budget absolutely move California closer to where we want and need to be,” said Assembly Speaker Anthony Rendon, D-Paramount (Los Angeles County).

Democrats in the Assembly also wanted $1 billion for a major expansion of Medi-Cal, to extend coverage to undocumented immigrant adults under 26 and create a tax credit for health insurance premiums.

They didn’t get it. Instead, the budget calls for a commission to be created to study how much it would cost to offer universal coverage in the state.

Health care and immigrant advocates were outraged.

“A study is no solution,” said Anthony Wright, executive director of the advocacy group Health Access. “New health care spending was zeroed out. It’s stunning.”

Cynthia Buiza, executive director of the California Immigrant Policy Center, called the budget deal “devastating.”

The agreement preserves one of Brown’s top priorities: adding to budget reserves that the state can draw on in an economic downturn. In May, the soon-to-beter-med-out governor called for banking most of an unexpected $8.8 billion surplus, telling lawmakers: “This is a time to save for our future, not to make pricey promises we can’t keep.”

The deal he reached with lawmakers will fill the state’s rainy day fund to its constitutional limit of 10 percent of general fund revenue, or $13.8 billion.

In May, Brown proposed placing $3.2 billion into the state’s budget reserve for unexpected expenses like wildfires and floods. But under Friday’s deal, $2.2 billion would be set aside instead. That left $1 billion for added spending, most of which is aimed at one-time budget boosts. Brown has emphasized that short-term surpluses should not go toward ongoing programs.

“California is on the verge of having another on-time, balanced budget,” Brown said in a statement. “From a $27 billion deficit in 2011, the state now enjoys a healthy surplus and a solid rainy day fund.”

The agreement would increase spending in a few areas. The California State University system would receive an extra $105 million in ongoing funding that will be included in future budgets as well, primarily to improve graduation rates. The deal also sends $167 million in one-time funding to CSU, mainly to pay for an enrollment increase of 3,641 full-time students and deferred maintenance.

The University of California would receive far less than CSU in extra ongoing money — just $5 million to help increase enrollment by 500 students. Another $177 million in one-time spending would go primarily toward general university needs and deferred maintenance.

Also included in the budget deal is $120 million that Brown proposed to create an online public college to help millions of working adults learn new skills that could help them get better-paying jobs.

“This budget agreement saves money for a possible downturn while assisting struggling Californians who haven’t benefited from our robust economy,” said Assemblyman Phil Ting, D-San Francisco, who chairs the Assembly Budget Committee. “We are addressing the homeless crisis, providing a path toward universal health care and keeping college affordable. These are the right investments for our state.”