May 19: How Governor Newsom's Budget Impacts You

Tuesday, May 19, 2020

Message from Ling Ling Chang

Dear Friend,

With 4.6 million Californians filing for unemployment just since March, and thousands of small businesses closed, tax revenues are down for the state.

In fact, the Governor’s office projects that California has a $54.3 billion deficit.  Some debate that number and feel it should be higher while others feel that were the economy to recover relatively quickly, the state would have a net deficit of $18 billion. Whatever the number, we are facing a significant deficit and here is what the Governor has proposed.

  • No New Proposed Income or Sales Tax.  I’m pleased the say the Governor’s budget does NOT include income, sales or property taxes. There is a discussion of other tax increases however, including the suspension of net operating losses for businesses and limiting business tax credits.  Raising taxes will make it even tougher to create new jobs and recover.
  • Use the Rainy Day Fund. I have long supported building up a rainy day fund so California has money in the bank when a crisis hits.  The Governor projects using $8 billion in California’s Rainy Day Fund in the next year and more in subsequent years.  An additional $5.4 billion would be used in 2021-2022 with the remaining $2.9 billion being used the following year.
  • State Salaries May Be Cut.  Negotiations will occur with the state’s collective bargaining units to achieve reduced pay of approximately 10%.  Bargaining may involve furloughs where state employees are paid to work fewer days or some other kind of trade off.
  • K-12 School Funding. The state budget proposal reflects a decrease of $14 billion  in education funding from the governor’s last budget and a $4 billion decline just in the current year.  I will work to ensure we find savings in other places, see a quick recovery or get some help from the federal government to avoid these kinds of cuts. My bill to restore state lottery funding for education would be a small step in this direction. Read more about my bill here.
  • UC and Cal-State Budgets May be Cut.  Right now, a 10% cut to the UC and Cal State systems is on the table.
  • No Health Care for Undocumented Immigrants.  The Governor’s budget eliminated a proposal to provide health care coverage to immigrants over 65 living in the county illegally, which would’ve cost an estimated $112 million.
  • More Efficiency.  The COVID-19 pandemic has required an unprecedented shift to telework for state government that has allowed state managers to rethink their business processes. This transformation will result in expanded long-term telework strategies, reconfigured office space, reduced leased space, and flexible work schedules for employees when possible.
  • Small Business Loans.  The Governor’s draft proposes an augmentation of $50 million for a total increase of $100 million to the small business loan guarantee program to fill gaps in available federal assistance.  We will likely need more than that, but it is a start.
  • I Oppose Lay Off Police and Firefighters.  The Governor has publicly called for the federal government to help the state avoid some of these cuts. He said that if we don’t get billions from Washington, the first people laid off will be police officers and firefighters.  I hope this is only a negotiation tactic that the Governor is using to pressure Washington. Count on me to oppose any efforts to lay off first responders.

The California Legislature is required to pass a budget by June 15 and the Governor’s plan will change as it goes through the legislative process, if the federal government provides additional assistance, or the economy rapidly improves or deteriorates.

I will keep working to ensure the people of my district are represented in Sacramento, and I’d love to hear from you. Please email me at Senator.Chang@senate.ca.gov or call 714-671-9474.

Sincerely,
Ling Ling Chang
29th District

Congratulations Class of 2020

Hats off to our graduating students! Whether you're earning a diploma, a program certificate, a degree or even promoting to a new grade, your hard work deserves recognition. While many of my constituents are unable to participate in a traditional ceremony, my team and I have planned an alternative to help students celebrate.

On June 4, 2020, I will be hosting a free graduation photoshoot, and I invite all graduating students to participate. To help us implement physical distancing restrictions and precautions, you must register to participate here.

These unprecedented times call for unprecedented celebrations. It is my sincere hope to cheer on our graduating students and help them safely celebrate their accomplishments. If you have any questions, please do not hesitate to email Vivian.Cao@sen.ca.gov.