Gov. Newsom’s First State Budget Reveals His Priorities
Safe & Affordable Drinking Water Fund Included in the 2019-2020 Budget
Governor Gavin Newsom released his 2019-2020 proposed budget on January 10, which totals $209 billion overall with $144 billion of that amount comprising General Fund spending. The budget plan takes advantage of the state surplus and emphasizes funding for education, housing and health care, among other priorities. Governor Newsom said much of the spending for his chief policy issues is one-time funding, as opposed to reoccurring expenses.
The governor also attempts to underscore the need for a solid fiscal foundation in his budget by allocating $13.6 billion for budget resiliency purposes to pay down unfunded pension liabilities, build “Rainy Day” reserves, as well as pay down unfunded retirement liabilities.
Ag Council is pleased the governor’s budget proposal includes a commitment of $4.9 million in one-time General Fund dollars to take the initial steps to implement the Safe and Affordable Drinking Water Fund. This is an important step as we seek a permanent solution to the safe drinking water crisis. The language is similar to former Governor Jerry Brown’s budget item last year and shows the new governor’s commitment to address the safe drinking water issue in California. Governor Newsom specifically cited Senator Monning’s safe drinking water bill and stated that we “have to get this done.” He said, “it’s a disgrace” that one million people are without safe drinking water in California.
Though much work remains to be done on this issue, Ag Council is encouraged by the governor’s statement and the prioritization of safe drinking water in his state budget proposal. The Legislature will now review and hold hearings on the state budget over the next few months before finalizing the budget in June.
Please click HERE to read the governor’s budget press announcement.
Gov. Newsom Announces Blueprint for the Cap and Trade Expenditure Plan for 2019-2020
As part of the January budget proposal, Governor Newsom announced his blueprint for the Cap and Trade Expenditure Plan, which is funded by the entities that pay into the state cap and trade program, including some Ag Council members. The approximately $1 billion in cap and trade funds in the Expenditure Plan are intended to support efforts to reduce or sequester greenhouse gases.
This is an important funding mechanism and agricultural advocates, including Ag Council, have secured and utilized Expenditure Plan monies over the past two years in order to lower both mobile and stationary emissions.
The governor’s budget proposal released this month unfortunately allocates fewer dollars in the Expenditure Plan toward certain agricultural categories. However, it is important to note this is a new governor who is placing his own imprint on the state budget and a great deal of work is yet to be undertaken during the legislative budget process.
Ag Council is advocating for an increase in the funding levels for critical programs utilized by our members in order to lower emissions and benefit air quality, especially in poor and disadvantaged communities.
Below are the funding allocations in the governor’s current plan.
2019-2020 Cap and Trade Expenditure Plan (ag programs)
* Methane reduction (dairy digesters & alternative manure methane reductions) – $25 million
* Ag diesel engine replacement & upgrades – $25 million
* Healthy Soils Program – $18 million
* Food Production Investment Program – no funding in the current proposal for 2019-2020
Governor Newsom increases funding in the 2019-2020 Expenditure Plan to expand the Healthy Soils Program to incentivize farmers to sequester carbon through certain management practices and also establishes a new effort to support job training for disadvantaged communities in a low carbon economy.
Again, keep in mind this is the initial proposal by a new administration, and Ag Council is working with both the Senate and Assembly Budget Committee members to improve the funding allocations for these and other programs where feasible.