What does $351 billion get you? Newsom’s final state budget

Welcome back to Capitol Confidential! 

The slate of ballot measures appearing before voters this November has been whittled down, negotiated, confirmed and named. The state budget has been fiercely debated, edited and now it, too, has made it across the finish line.

And that’s all just been in the last two weeks. 

As members approach their month-long summer recess starting on July 2, here’s the biggest takeaways from the last week of hustle and bustle in the Capitol. 

In a recorded video address released June 29 announcing he signed his final state budget, Gov. Gavin Newsom cast the deal as one of national significance. 

“We need to do something urgently in this country to address the radical imbalance of fortunes in America,” he began, calling California under his governance a rejection of the argument that “progressive ideas never pencil out.”

The $351.7 billion state budget increases some business and healthcare taxes, bolsters the state’s reserve funds to nearly $29 billion, extends caps on corporate tax credits, includes increased spending on housing and homeless aid, and commits $29 million for county election offices to help speed up vote counting.

“This budget reflects years of disciplined decisions that built historic reserves, paid down debt, strengthened our economy, and made transformational investments in education, healthcare, housing, infrastructure, and opportunity,” Newsom said, sitting behind a large desk and backdropped by American and California flags. “We’re leaving California stronger than we found it.”

It’s a stark contrast to his first budget signing announcement as governor in 2019, when he rolled up his sleeves in the summer heat to give a conversational and joke-filled speech to a crowd assembled at a Sacramento community college. 

While affordability was also a central theme then, Newsom’s final budget address this week framed California’s fiscal decisions not simply in terms of state governance, but as a rebuttal of President Donald Trump and his administration’s policies. Democratic legislators have done the same, as the Chronicle’s Sophia Bollag reported.

Many elements of the budget, particularly on healthcare, came in response to what Sen. Lola Smallwood-Cuevas, D-Los Angeles, described as “Washington essentially turning its back on working people, particularly those working in low-wage sectors.”

The state budget does not cover healthcare services for all Californians, she noted, and will still leave many immigrants without legal authorization to live in the United States without adequate care.

But Republicans pushed back on that framing, pointing out that Democrats have for years approved budgets that, in the long run, are projected to increase spending at a higher rate than the state brings in tax revenue. That’s not Trump’s fault, and is a big part of the reason Newsom first proposed scaling back care for undocumented immigrants.

Sen. Shannon Grove, R-Bakersfield, said state spending under the budget passed Monday is “unsustainable” and noted that the nonpartisan Legislative Analyst’s Office projects multibillion-dollar structural deficits moving forward.

California voters will have 14 ballot measures to consider in November, including the wildly controversial one-time billionaire tax, three bond measures and other proposals tackling elections, taxes, housing and health. 

If that seems like a long list, it is. It’s more than have appeared on ballots the last four consecutive election years. The last time voters had more than a dozen to consider was in 2016, with 17 propositions, which remains the record-holder for most ballot measures in a general election this millennium. 

But 14 is still nothing to sniff at. 

Mindy Romero, founder of the Center for Inclusive Democracy, said the number is notable. Not only because of the amount of work voters must commit to reading up on each proposition and settling on a decision, but because of the impacts ballot measures can have – think about all the mailers, TV ads and campaign funding. Then there’s the conversations from state and local lawmakers, who often take positions behind various initiatives, especially if the issues become divisive or capture broad public interest. 

One measure that is already grabbing attention - in California and nationally - is the billionaire tax. 

“Candidates, whether congressional or gubernatorial, at whatever level, are going to need to prepare and think strategically about what their position is on the billionaire tax,” Romero said. “Most candidates, across the board, are going to be asked about it.”

Here’s an early look at the 14 propositions, including their freshly assigned numbers. 

Sen. Scott Wiener has long been a target of critics on the right. But over the past week, Wiener has been in the spotlight for receiving a barrage of criticism from fellow marchers at San Francisco’s Trans March last weekend.

San Francisco Supervisor Connie Chan and her top endorser, Speaker Emerita Nancy Pelosi, publicly condemned the harassment directed at Wiener over the weekend, which were captured in viral videos. 

A video posted online showed a small group of activists confronting Wiener, who is gay and Jewish, on June 26 as he attempted to participate in San Francisco’s Trans March. One voice harassing Wiener said, “You stopped being queer the moment you started supporting Israel.” 

“The incidents of harassment against Senator Wiener went too far, and I condemn all forms of threats and intimidation which have no place in American political debate,” Pelosi said in her statement, which came in response to an inquiry from the Chronicle. 

Chan also addressed the incident publicly for the first time on June 29, saying in part that “there is no place for hate and violence in our City.”

On Wednesday, Sen. Adam Schiff, another Chan supporter, told CNN that the marchers’ treatment of Wiener was “appalling.”

A letter condemning the incident was signed by dozens of political leaders, including some union leaders and a couple of Democratic members of the Legislature. Others, including Rep. Ro Khanna, have offered similar sentiments on social media. 

As the Chronicle’s Joe Garofoli reported, the video was posted on X by a supporter of Chan’s. Both Chan and Wiener are running to fill Pelosi's congressional seat in November.