Why did California's budget grow 40% under Gov. Gavin Newsom?

Key Points:

• California approved its largest state spending plan ever, totaling $351.7 billion for the upcoming year, marking a 40% inflation-adjusted increase since Governor Gavin Newsom took office in 2019.
• The spending growth is primarily driven by increased funding for education and health and human services, with $37 billion added for community colleges and $25 billion for Medi-Cal, California’s health insurance program for low-income residents.
• Medi-Cal has been expanded under Newsom to cover about 2 million undocumented immigrants, primarily children and seniors, with a future plan to charge a $50 monthly fee for undocumented enrollees starting in July 2027.
• The budget also includes significant investments in K-12 education initiatives such as after-school programs, expanded transitional kindergarten, and arts education, as well as increased funding for universities, childcare, and state operations including IT services.
• Analysts note that 70% of the spending growth sustains pre-existing programs, and rising costs in provider rates and pharmacy prices have contributed to higher Medi-Cal expenses; lawmakers finalized the budget with ongoing debates over spending priorities.