Governor Gavin Newsom’s May Revise of the proposed 2020-21 budget reflects the dramatic scope and scale of the COVID-19 crisis and its impact on the state’s fiscal position. The proposed budget includes cuts across programs and services, and particularly deep cuts to education and health care. The budget also proposes to draw heavily upon reserve accounts to partially offset the anticipated $54.3 billion shortfall in the next budget year.
The COVID-19 public health emergency is putting tremendous pressure on the state’s budget outlook for both this year and beyond. The May Revise reflects the very difficult choices that need to be made to preserve funding for critical public services while also addressing immediate need to respond and recover.
It is important to note that the proposed budget includes $14 billion in cuts that will be “triggered” if the federal government does not approve a fiscal relief package for states by July 1, 2020. Vital safety net programs, including CalWORKs, IHSS, Medi-Cal, and SSI are included in these trigger cuts. CFPA and our state and national partners are calling for Congress to immediately pass the HEROES Act , which would provide $875 billion for state and local governments to fill budget deficits created by the pandemic. For more information about the HEROES Act, read our most recent Action Alert.
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This crisis highlights the long-standing need to fight hunger and poverty across our state. We appreciate the Governor’s recognition that, despite the need to make difficult choices, protecting the health and wellbeing of Californians in the wake of COVID-19 must be a priority, including access to food.
The following are highlights from the 2020-21 Governor’s May Revise with respect to food security:
CALFRESH
The May Revise proposes no changes to the CalFresh program, which has seen a dramatic surge in applications since the onset of the crisis as unemployment has skyrocketed. The budget retains funding for the 2019 expansion of CalFresh eligibility to SSI recipients by ensuring ongoing funding for the Supplemental Nutrition Benefit and the Transitional Nutrition Benefit programs that help households that lost CalFresh benefits or eligibility as a byproduct of the eligibility expansion.
EMERGENCY FOOD PROGRAMS
The May Revise proposes total financial support of $50 million for emergency food distribution. Food banks have been a lifeline for many Californians hit hard by the crisis and in need of help putting food on the table. CFPA and our anti-hunger partners are grateful to the Administration for their strong support for food banks during the crisis, and look forward to working with the Legislature to ensure the proposed investments are included in the final budget package.
STUDENT HUNGER
K-12 School Meal Investments:
- The May Revise withdraws the $70 million in Prop 98 funding from the Governor’s January proposed budget to improve the quality of subsidized school meals and encourage participation in the state and federal school nutrition programs. School meals have been a critical piece of the COVID-19 response effort by providing food to low-income students and their families while schools are closed. CFPA looks forward to working with the Administration and Legislature to ensure that eligible students continue to receive meals in the summer months and that the power and reach of school meals is maximized as an important part of the emergency recovery.
College Student Hunger:
- The May Revise proposes a decrease of $11.4 million to support food pantries and CalFresh outreach at community college campuses. Under the proposal, community college food pantries would continue to receive support through available Student Equity and Achievement Program funding.
EARLY CHILDHOOD
State Preschool and Child Care:
- The proposal withdraws the proposed funding from the January Budget for an additional 10,000 State Preschool slots. It further proposes a 10 percent cut in monthly payments to preschools and child care providers who care for low-income children, and cuts the previously proposed cost-of-living adjustment.
Early Childhood Nutrition:
- The January budget proposed new investments in K-12 nutrition, and none were included in the May Revise. We look forward to continue working with the Legislature and the Administration to identify opportunities to support child care nutrition as part of the COVID-19 recovery efforts.
POVERTY AND HOMELESSNESS
Homelessness:
- The May Revise proposes maintaining the $750 million in funding from the January proposal, but from federal rather than state sources. It also allocates $1.75 billion in federal CARES Act funding to local governments to address homelessness, with approximately one-third going to cities and two-thirds to counties.
CalWORKs:
- There are no grant cuts or eligibility cuts proposed for CalWORKs, despite expected caseload growth of 102 percent. The budget draws $450 million from the Safety Net Reserve in the 2020-21 budget to account for the caseload increase.
SSI/SSP Grants:
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- State funding for SSI/SSP grants is proposed to be reduced by $4 per month, per recipient.
This cut is one of the trigger cuts that will be reversed if the state receives federal relief funding.CalEITC and Young Child Tax Credit:
- The Budget maintains the increased investments in these credits that were made in the 2019-20 budget and does not provide any additional investments. CFPA and our partners are disappointed that the May Revise fails to expand CalEITC eligibility to immigrant families who pay taxes and face increased discrimination, but remain ineligible for the tax credit. CFPA looks forward to working with partners, the Legislature, and Administration to include that provision in the final state budget.
HEALTH AND HEALTHCARE
Medi-Cal Healthier California for All (Cal-AIM):
- The revised budget proposes to delay the implementation of this initiative. The project would have built upon the successes of demonstration programs such as Whole Person Care, the Coordinated Care Initiative, Health Homes, and public hospital system delivery transformation. CFPA looks forward to re-engaging with the administration once the project resumes. We will continue to recommend that the state recognize food insecurity as a key social determinant of health and prioritize improved care coordination to more seamlessly connect our most vulnerable Medi-Cal participants’, such as Californians facing homelessness, to existing supports.
Medi-Cal for Undocumented Older Adults:
- The May Revise withdraws the January proposal to expand eligibility for full-scope Medi-Cal benefits to all persons aged 65 years and older, regardless of immigration status. CFPA and our allies are deeply disappointed by this exclusion and will continue to urge the Legislature and Administration to expand access to affordable health care for all Californians.
Questions? Contact Jared Call at jared@cfpa.net or 323.401.4972.
