On Friday, May 13 Governor Jerry Brown released the May Revision to his proposed 2016-17 state budget. Lower than anticipated revenues resulted in General Fund spending of $122.2 billion, more than $400 million below the Administration's January proposal. Governor Brown continues to stress fiscal caution and frames his proposal in the context of the pending expiration of Prop 30 income tax increases, efforts to build the state's rainy day fund and an inevitable downturn in the economy.
For a summary of key provisions in the Governor's revised budget, visit the California Budget and Policy Center's website here.
Early Learning Block Grant Proposal
The May Revision details the Administration's January proposal to consolidate early education funding into a block grant that would support subsidized preschool for certain four-year-olds. The Governor proposes to implement the block grant in 2017-18 - one year later than originally planned - with TK eliminated as of July 1, 2017. Initial block grant funding would be set at $1.6 billion, which represents no significant additional investment in early learning programs. The Governor's revised budget also includes $20 million in Proposition 98 funds (of which $10 million would be ongoing) to assist County Offices of Education (COEs) with the transition to the new block grant.
For more details on the block grant:
- Early Education Block Grant Trailer Bill and Budget Language summary.
- Early Education Block Grant Bill language.
Senate Takes Action on Block Grant Proposal
The Senate Budget & Fiscal Review Committee voted on Wednesday, May 18 to reject the Governor's early education block grant proposal. You can see the Committee agenda with specific proposals here - staff recommendations were approved as proposed. The Assembly also previously rejected the Governor's block grant proposal. Combined these actions mean that the Governor's proposal as presented in the May Revise will not be part of the budget process. To be clear, other early education proposals, which may include an alternative block grant proposal or other reform package, may still appear in the final budget once negotiated.
State Budget Next Steps
The Assembly and Senate will continue reviewing the May Revision and move toward finalizing their versions of the budget in subcommittee hearings. Both the Assembly and Senate may submit their own early education proposals for consideration. In addition, the Legislative Women's Caucus continues to ask for an $800 million increased investment in child care programs.
A coalition of early education advocacy organizations, including the First 5 Association, have sent budget leadership a letter advocating for significant investment in the state's early learning and care system, as well as a recommendation that any reforms to the system take place outside of the budget process with sufficient time to thoughtfully address significant policy changes.
Once each house completes its budget, a legislative conference committee will meet to resolve any differences. Each house will then vote on a final budget and if adopted it will be sent to the Governor for approval. The Legislature must approve a budget by June 15.