This update reflects the developments of the 2015-16 State Budget Package as approved by the California Legislature this week.
On Monday, June 15th, the California Legislature approved the 2015-16 State Budget, yet only a handful of budget trailer bills that assist in implementing the State Budget were adopted. The State Budget Package including the Budget Bill (Assembly Bill 93) and the four trailer bills passed on Monday have been forwarded to the Governor for his consideration in order to meet the July 1st constitutional deadline to have a State spending plan in place.
On Tuesday, June 16th, the Governor and Legislative Leadership announced that a budget agreement had been reached. In addition, the Governor proclaimed two special sessions to address roads/highways/infrastructure and health care financing. For the first special session, Fixing California Roads, Highways and Other Infrastructure, the Governor proposes that the Legislature enact permanent and sustainable funding to maintain and repair the State’s transportation and critical infrastructure, improve the State’s key trade corridors, and complement local infrastructure efforts. For the second special session, Shoring Up Health Care Financing, the Governor proposes that the Legislature enact permanent and sustainable funding to provide at least $1.1 billion annually to stabilize the State’s General Fund costs for Medi-Cal.
Earlier today, the Legislature completed the adoption of a substantial number of trailer bills; however, a handful of trailer bills that do not face a July 1st deadline, including the final allocation of Cap-and-Trade proceeds, are being deferred to later in the Session. Additionally, to reflect the agreement reached on Tuesday, the Legislature adopted a trailer bill (Senate Bill 97) that makes significant revisions to the Budget Bill that had been adopted on Monday.
Key Issues/Changes for RCRC Member Counties
The 2015-16 State Budget Package as adopted:
- Changes existing law to make State Payment In-Lieu of Taxes (PILT) payments permissive as opposed to required; provides $644,000 for PILT for the 2015-16 fiscal year, but does not provide $8 million, as approved by the Legislature, for previous year’s payments;
- Authorizes the State Water Resources Control Board to mandate the consolidation of two or more public water systems, state small water systems, or residences not served by a public water system in a disadvantaged community that is in an unincorporated area or served by a mutual water company;
- Allocates no funding for Home-to-School Transportation funding;
- Eliminates the $328.7 million in partial programmatic allocations from the Cap-and-Trade auction proceeds to various agencies in the original budget bill to address allocations of all Cap-and-Trade proceeds as a separate matter in the coming months;
- Restores the exemption for elected officials in the California Public Employment Retirement System who are currently retired;
- Completes in full the repayment of all pre-2004 Mandate Claims;
- Allocates no funding for Williamson Act subventions;
- Maintains State Responsibility Area (SRA) fees as a source of funding for resource-related programs;
- Fully funds federal health reform/ Affordable Care Act;
- Does not restore Medi-Cal reimbursement rate cuts;
- Allocates $245 million to address counties administration costs for Medi-Cal; and,
- Provides a modest increase for state fairs.
The Governor is expected to sign the State Budget and budget-related bills into law in the coming days. It is expected he will use his line-item veto authority on a number of items. Once this process is completed, RCRC staff will provide a comprehensive 2015-16 State Budget Summary.