New­som ex­pects $7B in virus spend­ing

Times Standard (Eureka) - - FRONT PAGE - By Adam Beam

SACRA­MENTO » Cal­i­for­nia Gov. Gavin New­som ex­pects to spend up to $7 bil­lion this year bat­tling the coro­n­avirus and the eco­nomic dis­rup­tion it has un­leashed as state bud­get ex­perts warned law­mak­ers to pre­pare for rev­enue loss akin to the Great Re­ces­sion.

New­som has al­ready au­tho­rized spend­ing more than $2 bil­lion on things like ho­tel rooms for the home­less, loans to small busi­nesses and cash pay­ments to adults liv­ing in the coun­try il­le­gally who are not el­i­gi­ble for fed­eral stim­u­lus ben­e­fits.

The virus’ spread in Cal­i­for­nia has not been as dev­as­tat­ing as pub­lic health of­fi­cials had feared, with the growth in hos­pi­tal­iza­tions slow­ing as the state has been un­der a manda­tory stay-at-home or­der for nearly a month that has closed schools and nonessen­tial

busi­nesses. But New­som warned ear­lier this week that its steady pres­ence would likely con­tinue to dis­rupt pub­lic life well into the sum­mer and beyond.

Un­em­ploy­ment data re­flect­ing the coro­n­avirus re­stric­tions won’t be avail­able un­til next month. But

Leg­isla­tive An­a­lyst Gabriel Petek said the num­ber of peo­ple who have filed for un­em­ploy­ment ben­e­fits — more than 2.7 mil­lion as of Wed­nes­day — in­di­cate be­tween 12% and 15% of Cal­i­for­ni­ans have lost their jobs.

“The pace of job losses that we are see­ing, caused by an abrupt halt­ing of eco­nomic ac­tiv­ity, make it clear the econ­omy has en­tered a re­ces­sion, and pos­si­bly a quite se­vere one,” he said, adding that the Leg­is­la­ture should pre­pare for a “very sub­stan­tial” de­cline in rev­enue.

The $7 bil­lion New­som plans to spend does not in­clude other in­creased costs for things like Med­i­caid and other so­cial safety net pro­grams that have been af­fected by the virus. So far, the money New­som has spent came from an emer­gency re­serve fund and $1 bil­lion the state Leg­is­la­ture gave to him just be­fore they re­cessed on March 16.

Vivek Viswanatha­n, chief deputy direc­tor for bud­get at the Cal­i­for­nia De­part­ment of Fi­nance, said they ex­pect the fed­eral gov­ern­ment to re­im­burse up to 75% of the state’s coro­n­avirus spend­ing be­cause of Pres­i­dent Don­ald Trump’s ma­jor dis­as­ter dec­la­ra­tion.

“This is an un­prece­dented sit­u­a­tion,” Viswanatha­n said.

It’s un­clear how New­som wants to spend this money. Viswanatha­n said the ad­min­is­tra­tion would have more de­tails when it updates its bud­get pro­posal next month.

Viswan­than’s com­ments came as state law­mak­ers held their first over­sight hear­ing on Thurs­day to ex­am­ine how New­som has been spend­ing tax­payer money to ad­dress the cri­sis. Most law­mak­ers on the spe­cial bud­get sub­com­mit­tee par­tic­i­pated via video con­fer­ence in a hear­ing that tested the tech­no­log­i­cal lim­its of pub­lic de­bate in an era of so­cial dis­tanc­ing.

Just two sen­a­tors at­tended the hear­ing in per­son, held in a large com­mit­tee room in the state Capi­tol. Se­nate Bud­get and Fis­cal Re­view Com­mit­tee chair­woman Holly Mitchell wore a mask and con­ducted the hear­ing with a pack­age of dis­in­fec­tant wipes at her side.

The hear­ing was de­layed by nearly an hour be­cause the Se­nate’s web­site crashed as more than 10,000 peo­ple beyond what state of­fi­cials had ex­pected tried to watch the hear­ing.

Thurs­day’s com­mit­tee meet­ing is the first leg­isla­tive hear­ing since law­mak­ers re­cessed on March 16 be­cause of the coro­n­avirus, be­lieved to be the first un­sched­uled work stop­page at the Capi­tol in 158 years.

Cal­i­for­nia has more than 27,600 con­firmed cases and more than 950 deaths, ac­cord­ing to data com­piled by Johns Hop­kins Univer­sity.

For most peo­ple, the coro­n­avirus causes mild or mod­er­ate symp­toms, such as fever and cough that clear up in two to three weeks. For some, es­pe­cially older adults and peo­ple with ex­ist­ing health prob­lems, it can cause more se­vere ill­ness, in­clud­ing pneu­mo­nia, and death.


State Sen. Holly Mitchell, D-Los An­ge­les, chair of the Se­nate bud­get com­mit­tee, gives a dou­ble thumbs-up after Sen. Nancy Skin­ner, D-Berke­ley, joins by video an over­sight hear­ing of the Se­nate bud­get spe­cial sub­com­mit­tee on COVID-19at the Capi­tol in Sacra­mento on Thurs­day.

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