Spending Proposed As Part Of The $214.8B California Budget

Speaker 1: 00:00 State legislators approved a 214 point $8 billion budget yesterday. And in our efforts to expand health care, education and taxes, but there are still loose ends to tie up here to talk about it as state senate pro tem from San Diego, Tony Atkins, Senator Atkins. Welcome. Thank you. It's good to be here. Jay, what's your overall impression of the budget the legislature sent to the governor yesterday? Speaker 2: 00:24 Well, I'm, I'm very excited about it. It's a, it's probably the best budget we've seen in California in decades. Uh, and what's especially great about it is it puts money into paying down debt, almost $9 billion. We have almost a $20 billion reserve and rainy day fund. We are paying down pension liabilities and at the same time, uh, we're able to put more money into programs that really support, uh, working Californians and, uh, education. Uh, another big winner. So there's, there's so much good in this budget. I can't help but feel good. Uh, 2010, I got elected, we had a 26, $27 billion deficits. So this is, this is this incredible progress for California. And negotiations are ongoing about a state tax credit for those with the lowest incomes in the state. What can you tell us about that effort? The earned income tax credit, it's one of the best programs. Speaker 2: 01:19 Uh, California, a number of years ago when I was speaker, I championed a program to start a state earned income tax program. The great thing about that is it invest absolutely into our lower income and our middle income Californians, it mirrors our matches, a federal tax credit that already exists. So this is thousands of dollars potentially between the two credits that can come back to working families. And the great thing about the earned income tax credit is it's sort of a three for one. You've got an individual family who now has more money to spend for groceries or food or shoes for their kids, uh, but they typically spend that money in their local community. So small businesses benefit from that and then it helps the community. So it's a program I'm very excited about. We've expanded it over the last several budget cycles, a little at a time. Governor Newsome wanted to make this the cornerstone of support for working families. And, uh, as we wrap up the budget in the next coming weeks, we did the framework, approved the budget, uh, that the Senate and the assembly. Uh, we sent that to the governor. Uh, we'll close this out with earned income tax credit in the next week as we approve some other measures. Speaker 1: 02:31 And what's the negotiation still being ongoing? Um, how could that impact the budget approved by the state legislature? What's still Amir? Speaker 2: 02:39 Well, we have a number of what we call trailer bills, which is how the funding that the amounts of money are already established in the, in the bill. That is the budget bill. Uh, they call it the bill in chief for the insiders. Uh, but the trailer bills will be on every category. Uh, health education. Those numbers will be included in those trailer bills and we will approve those over the condom coming weeks. So the state tax credit is, has been girded from negotiations basically. Yes. Uh, the bill went into print on na as I left yesterday about four o'clock. I was waiting to hear had the bill gone into print that included the earned income tax credit and it has. Okay. The budget includes funding health insurance for people between the ages of 19 and 25 who are living in California illegally. Why was that a priority for the legislature? Speaker 2: 03:31 Well, I think there is the belief that Californians that we, everyone should be covered. In fact, a recent public policy institute of California poll said that more than two thirds of California support coverage for undocumented folks, if you want to, um, bring it home, it costs more not to cover people because when people wait until there is an emergency and they present themselves at the emergency room, it actually cost more money for California. So I think, uh, this budget, uh, really speaks to the importance of trying to ensure that everybody is covered. If I have one regret, it is that we weren't able to include seniors, uh, folks 65 and older, who by the way are actually paying taxes. They tend to wait until, uh, they can do nothing else other than go to the emergency room. So it's my hope that as we continue to invest, uh, in healthcare that we recognize the fiscal responsibility, the humaneness and the importance of including seniors as well. Speaker 2: 04:32 Included in the budget was funding to increase subsidies for Californians to buy health insurance. It would be funded by finding people without health insurance. Does the legislature have to do anything further to enact this? Uh, we have to vote on it. Uh, I mean that's, that's basically it. And that will be part of one of the trailer bills in the coming weeks. I would offer that that, uh, mandate was part of the affordable care act under the Obama Administration's affordable care act plan. It was the current administration that rescinded that, that actually put the overall program in jeopardy a because you have to be able to pay for the entire system, uh, in one way or another. So we are following the intent as the state of California of the affordable care act, uh, that most Americans embraced and felt wonderful to be able to have for the first time in their lives. Speaker 2: 05:22 But we do recognize that we have to work to bring down the cost of healthcare across the board. Uh, governor Newsome has proposed a task force to look at that and other measures. That's part of what we need to do here. Do you expect the Trump administration will challenge this given that, you know, as you said, the federal government eliminated the requirement for people to be insured? I hope not. I mean, I, there is a argued argument to be made for states' rights and how we fund our programs. We count on federal funds, we count on waivers. The administration at least, you know, the departments have looked at this from other states and actually approve these things. But, you know, one step at a time, we hope to make the case. We hope that our commitment as a state to these issues will, uh, help, uh, understand that we're trying to do this for all of our citizens and all of our residents. Speaker 2: 06:18 The budget includes 2.4 billion to address the State's housing and homelessness crisis despite previous funding to solve the homelessness crisis. The problem persists and in some cities is growing. What will it take for funding to be effective? And do you see that in this budget? I see funding in this budget to help with the emergency situation. We've uh, the governor recommended we approved a $650 million for emergency homeless services and you're going to see a lot of that money come into San Diego. A couple of projects we're highlighting this weekend, but in the broader sense, um, this isn't just a money problem. This is a production problem. It is a zoning problem. Um, the state of California, the legislature, the governor are engaged in serious discussions about how to move production forward and at the same time respect communities and local control. That's the crux of our issue. Speaker 2: 07:13 How to have community support, increased housing production, I e. Density in some places and do that in a way that doesn't detract from the quality of life. That's the argument we are having now. The conversation and the dialogue. Um, you know, we really needed to be having this dialogue all along and it took a crisis to force us to see that we're going to have to make some hard choices about how and where to build. That's a major part of the discussion right now. In addition though, we are still putting more money in almost two point $5 billion and of that 650 million directly to communities for emergency homeless services, Republican's have criticized 150 million in last minute earmarks for lawmakers. Here's Assembly woman, Melissa Melendez. California is number one in poverty. We are number one in homelessness. We are number one in veterans' homelessness, but we're going to spend three and a half million dollars on a dog park. Speaker 2: 08:15 Do earmarks in the budget concern you at all? Well, I think, uh, to the point of poverty, homelessness and veterans, that is a result of the discussion we just had. We need more housing. And uh, in terms of, uh, projects, I just came from Balboa Park where we, uh, unveiled that we were spending $8 million for the botanical building in Balboa Park. Um, over the history of the last decade of recession, investments have not been made in infrastructure. That piece of infrastructure, the botanical building and babble a park is iconic. It's world known. It is falling apart. That is an economic engine in the arts and cultural world of San Diego that drives tourism. We get millions of people in Balboa Park to stand right in front of that lily pond and that botanical building and take a picture. That's economic revitalization. We have not invested in deferred maintenance in more than a decade. So, uh, you can call it pork. Speaker 2: 09:18 We can call it an investment in something that matters to this community economically. These are one time funds. The it, when you have one time funds, you should not put them into programmatic programs that require ongoing funding. You will have to cut it next year. So when you have one time funds, you do things like we did, we've paid down debt, $9 billion. We've put money into pension liability, um damn payments and paying more into pensions. We have put money into the a rainy day fund, $20 billion. We are putting one time money into those funds so that when we go into a recession, we can buffer that. But to put one time money into ongoing programs is irresponsible at best because we will only have to cut it if we go into a recession. So, um, we're trying to use some of those funds to enhance communities. Speaker 2: 10:12 Uh, and it's sort of the incentive. If you have a dog park and you create some [inaudible] density and more housing around it, you're going to be able to walk your dog to the park. Is that a simple statement? Yes, but it is a quality of life issue. And you know, as you mentioned, having ongoing funding, you know, many economists are warning about a recession or economic slowdown is the budget recession proof. I think we're doing everything we can to harden the budget. Uh, so that it is a buffer in the event that we start to go into a recession. Uh, you have economist. I've, I've talked to economist and I have great deal of respect for economist because it's, it's something you need to understand, but it's sort of like we may go into a recession, we may not. Um, some economists have been calling for a recession for the last five years and we haven't, but that doesn't mean it's not going to happen because it eventually will, we will see a dip, I would say $20 billion, uh, as a buffer in terms of the rainy day fund, the regular reserve, the education reserve, that safety net, a reserve. Speaker 2: 11:19 All of those things are designed to look at specific parts of the budget and provide a buffer. And we're also, as you see the budgeting that the governor has proposed and that so far the assembly and the Senate have agreed to, we are looking at the out years of ongoing funding for programs and we are making sure that that is balanced. We're not overspending. That's part of the budget construct. And so we are not overspending on programmatic issues in a way that could hurt us further. And then we have our reserve. I've been speaking with state senate pro tem from San Diego, Tony Atkins, Senator Atkins. Thank you so much. It's always a pleasure, Jay. Thank you.