Transcript Highlights:

• some of the reductions some of the reductions don't<01:44:24.159> implicate<01:44:24.560>
• $1.5 billion net reduction.
• $1.5 billion net reduction.
• 01:45:51.599> overall<01:45:52.040> reduction of the overall reduction of the overall reduction
• <01:45:59.320> it's $1.5 billion net reduction it's $1.5 billion net reduction it's 23<01:

Keywords: 1187, senate, all

Transcript Highlights:

• So just those reductions in aid.
• deficits while also providing<00:42:32.720> rate<00:42:33.040> reduction<00:42:33.440>
• I really cringe every time you say, ‘Well, here's a reduction.’ You know, that reduction.
• I really cringe every time you say, “Well, here's a reduction.” You know, that reduction.
• reduction in some uh in sales taxes. reduction in some uh in sales taxes.

Keywords: 1187, senate, all

Transcript Highlights:

• <00:52:40.480> in first BM projected $6 billion deficit in first BM projected $6 billion deficit
• <00:52:51.760> in while still having a sizable deficit in while still having a sizable deficit
• <00:52:58.319> in taxes when we are facing a deficit in taxes when we are facing a deficit
• like I said when we've had deficits like I said when we've had deficits we've<01:46:10.320> decided
• <02:04:44.360> and sets the stage for future deficits and sets the stage for future deficits

Keywords: 1183, house

Transcript Highlights:

• That is to say, we're not describing there as being a surplus or a deficit.
• We both see quite large deficits.
• To continue the momentum on addressing these deficits.
• It is not a new thing for there to be deficits in those future years.
• The same, by the way, is true when there's a deficit.

Keywords: 988, house, all

Transcript Highlights:

• So there's years where there's been reductions that are double-digit reductions, and years where there's
• With this disruption in the current year, we kind of now find ourselves in deficits.
• I mean, we had deficits before, but I would just encourage kind of out-year discussions.
• With this disruption in the current year, we kind of now find ourselves in deficits.
• , and in some years that reduction has not occurred, and some years a reduction has been less.

Summary: The Assembly Budget Subcommittee on Education Finance held an oversight hearing on the California State University system covering enrollment, core operations, Title IX/civil rights, and basic needs. The Department of Finance said the Governor’s 2026-27 budget does not change CSU enrollment targets from the prior year and proposes a 5% ongoing General Fund increase for core operations as the final year of the compact. The Legislative Analyst’s Office recommended a lower resident undergraduate enrollment target than the Governor’s proposal, separate funding for enrollment growth rather than folding it into base, a smaller or no base increase tied more closely to inflation, earmarking some base funds for capital renewal, retiring deferred payments, and avoiding new multi-year compact commitments. CSU said enrollment has rebounded for three straight years, but growth is uneven across campuses, with several Northern California campuses still facing structural declines tied to demographics and community college pipelines. CSU described a multi-year reallocation plan shifting about 10,000 FTE and $89 million in ongoing funding toward higher-demand campuses, plus $40 million in one-time support, and said seven campuses submitted turnaround plans aimed at recovering enrollment over the next several years. The system highlighted strategies such as dual enrollment, guaranteed admission pathways with community colleges, outreach to high school students, retention and advising efforts, and new degree models for working adults and military-connected students. Members raised questions about how campus targets are set, whether the May Board of Trustees discussion will address a systemwide enrollment framework, and how CSU will manage future deficits if projected out-year funding does not materialize. On core operations and facilities, CSU said it faces about $320 million in mandatory cost increases in 2026-27 and is pursuing shared services, procurement consolidation, campus administrative sharing, and program redesigns to reduce costs. CSU and the LAO emphasized the system’s large deferred maintenance backlog, estimated at $8.6 billion, and discussed whether CSU’s bond/debt capacity is sufficient to address it; CSU requested up to $1.1 billion for deferred maintenance, while the administration did not propose new funding. The committee also heard CSU’s annual Title IX and civil rights update: CSU said it has implemented 15 of 16 State Auditor recommendations, has dedicated Title IX coordinators at every campus, is using a systemwide case management dashboard, and is piloting centralized investigations at five campuses. Finally, on basic needs, the Governor maintained current funding levels for food assistance/basic needs, rapid rehousing, and mental health. CSU reported heavy use of food pantries, CalFresh support, emergency housing, and counseling services, while warning that federal changes to CalFresh and related funding could make it harder to serve students in need.

Transcript Highlights:

• On line 36, they had a request for a jury pay deficit.
• Uh, this money is also pay deficit.
• We are reducing, and these reductions are to the current biennium.
• So these are fiscal 24 and 25 reductions.
• The cannabis and 25 reductions.

Bills: HF2300

Keywords: 1183, house

Transcript Highlights:

• Currently, the budget proposes the one-time $166 million transfer and ongoing reduction.
• ...used for the MVA deficit that we just talked about before, correct?
• That's how I would interpret this. ...MVA deficit problem. That's how I would interpret this.
• These short-term deficits on this scale really create irreversible damage, like... ...term deficits on
• Those structural deficits are coming and coming fast.

Summary: The committee held an informational hearing on transportation agency budget proposals and did not take any votes. The first major discussion focused on the Motor Vehicle Account shortfall and a proposed one-time $166 million transfer from the Air Pollution Control Fund and Greenhouse Gas Reduction Fund to offset California Air Resources Board mobile source costs. Department of Finance and the LAO described the account’s long-running structural deficit, driven largely by employee compensation growth and REAL ID-related workload, while members criticized the use of Proposition 4, GGRF, and other one-time or redirected funds as backfills and urged a longer-term solution that addresses both revenues and expenditures. The committee then heard Caltrans’ request for $25 million in General Fund support to create a Clean California Community Cleanup and Employment Pathway Grant Program. Caltrans said the program would build on the prior Clean California effort by funding local litter and graffiti cleanup, community engagement, and workforce pathways for vulnerable populations. The LAO recommended rejecting the proposal, arguing that local litter abatement is not a core state responsibility and that one-time funding is unlikely to solve persistent local cleanup needs. Several members echoed those concerns, while public commenters split between support for the cleanup/employment model and calls to instead restore funding to the Active Transportation Program and transit operations. The Tahoe Regional Planning Agency requested that California administratively recognize Tahoe’s federally designated population figure for state formula-based transportation funding, which would raise the population count used in formulas from 40,000 to 145,000. The agency said the change would not request new money but would better align state formulas with federal law and support a shared regional funding framework; members appeared generally supportive, though they noted the need to phase in the change to reduce impacts on other regions. The final presentation was on High-Speed Rail. The LAO reviewed the authority’s project update report, noting that it did not fully meet statutory requirements and that key details are still pending in a supplemental report expected later in the summer. The LAO said the Merced-to-Bakersfield segment still shows an estimated roughly $7 billion funding gap, with no specific plan to close it, and highlighted risks from federal review, inflation, and uncertain GGRF revenues. High-Speed Rail Authority staff said they are conducting a bottom-up review of scope, schedule, ridership, and costs, expect to provide updated information by late summer, and are exploring public-private partnerships and other financing strategies. Members stressed that no further funding commitments should be made until the updated analysis is available.

Transcript Highlights:

• If you spread that out, so even that's, and when we get into the deficit reduction components, you'll
• The entire discretionary budget still has a deficit.
• Loan was going to cause a deficit spending of $1.9 trillion. Mr.
• , you'd still have a deficit.
• That's a 12 billion dollar reduction. Is that correct? **Mr.

Transcript Highlights:

• And what you will see is that there is a deficit.
• And then that deficit is actually larger now.
• And so the deficit is roughly. $1.7 billion per year.
• But this is a per year deficit.
• average, a four-day reduction in learning.

Keywords: 1184, house, all

Transcript Highlights:

• These high-carbon fuels generate what we call deficits, and deficit-generating companies must retire
• Far exceeding our required carbon intensity reductions.
• intensity reductions in the regulation.
• So you're incurring deficits and purchasing credits on a quarterly basis.
• There was just a study completed by UC Riverside that showed the reduction was at a full 82% reduction

Summary: The hearing was a select committee discussion on the transportation costs and impacts of California’s Low Carbon Fuel Standard (LCFS), with opening remarks from the co-chairs and members emphasizing affordability, climate goals, and the need to explain the program’s benefits to the public. The first panel from CARB and the California Energy Commission described how LCFS works as a market-based, declining carbon-intensity program that rewards lower-carbon fuels, supports zero-emission vehicle infrastructure, and is intended to reduce greenhouse gases and local air pollution. They argued the program has driven billions in private investment, increased alternative fuel use, and that LCFS credit prices are not the main driver of retail gasoline prices, which they said are dominated by crude oil, refining, and distribution costs. Members questioned the panel on the gap between the regulatory target and actual carbon-intensity performance, the role of credit banking, which fuels are generating the most credits, how the 2025 amendments affected the program, and whether LCFS credits are truly additional. CARB explained that banking helps cost-effectiveness and investment certainty, that ethanol, renewable diesel, and biodiesel currently provide the largest volumes while electricity is expected to grow, and that the updated targets were informed by the state’s 2045 carbon-neutrality goals and the 2030 scoping plan. The Energy Commission said its data show environmental programs add some cost to gasoline but do not drive price volatility, which is mainly tied to crude oil and refinery margins. The second panel, featuring academic and research experts, focused on program design, out-of-state credit generation, and broader economic effects. Speakers said LCFS is successful because it ties incentives to emissions benefit, uses life-cycle analysis, and allows flexible compliance that lowers costs compared with more direct regulation. They also said the program’s benefits generally outweigh costs, that it can reduce air pollution disparities and support equity, but that some issues—especially indirect land use change, additionality, and older program assumptions—need more research and may warrant future rulemaking. One researcher noted that while LCFS likely raises gasoline prices somewhat, the effect is uncertain by design and usually smaller than normal market fluctuations, and another warned that limiting credit generation too narrowly could create legal and efficiency problems.

Transcript Highlights:

• We are concerned about the proposed reduction in the program in the governor's budget.
• We did see a reduction of about 15% in campus workload across the whole system.
• We did see a reduction of about 15% in campus workload across the whole system.
• I haven't heard of any reduction of applicants for the programs.
• Learning colleges with a 6% funding deficit.

Summary: The subcommittee on Education Finance heard an overview of the governor’s budget proposals and higher education financial aid trends, with a major focus on the Middle Class Scholarship (MCS), Cal Grant spending, and the effects of recent federal student aid changes. The Department of Finance said the budget would fully fund Cal Grant at projected levels and reduce MCS coverage from 35% to 17.5% of unmet need in 2026-27, while the Legislative Analyst’s Office supported considering the reduction as a cost-saving measure given out-year deficits. UC and CSU representatives opposed the cut, saying MCS is important to affordability and debt-free degree goals; they estimated average awards would fall substantially and that campuses do not have funds to backfill the loss. The Student Aid Commission said the proposal would reduce aid but simplify administration, and members questioned how lower awards would affect students, borrowing, and work-study options. No vote was taken, and the issue was held open for possible future action. The committee then discussed federal changes to student loans and Pell Grant policy under H.R. 1, including caps on Parent PLUS loans, elimination of Grad PLUS loans, and new proration rules for federal direct loans based on enrollment intensity. The LAO said these changes would likely push some borrowers into the private market, especially graduate and professional students and some parents of students at private institutions. CSU said the changes would affect thousands of graduate and part-time students and could reduce access by about $97 million in loan availability for part-time borrowers, while UC said the new definitions of professional degrees were too restrictive and would reduce access for nursing, teaching, law, dentistry, and other programs. Community colleges said they use relatively little federal loan aid but are monitoring Workforce Pell. Members raised concerns about workforce impacts, social mobility, and whether the state should consider alternative loan programs or other ways to reduce student costs. This issue was also held open. In the segment financial aid update, the LAO reported Cal Grant spending is projected to rise to about $3.2 billion in 2026-27, driven by more recipients and higher awards tied to UC and CSU tuition increases, while CSAC said FAFSA and CADAA applications are up significantly year over year. CSU, community colleges, and UC described their aid packaging and rising aid totals, with CSU reporting over $5.5 billion in aid to 381,000 students, community colleges reporting over $4.3 billion to more than 920,000 students, and UC reporting $3.17 billion in grant aid to undergraduates. Members asked about Cal Grant reform, application trends, and long-term outcomes; UC and community colleges pointed to alumni and wage dashboards, and the LAO noted the state’s Cradle to Career data effort. The committee then took public comment, including testimony on library funding and other education-related priorities, and concluded by holding the issues open without formal action.

Transcript Highlights:

• projected deficit in the second bianium. projected deficit in the second bianium.
• <00:23:32.880> of<00:23:33.039> about reduction of about reduction of about $6.59<00:23
• reduction to uh transportation sparity? reduction to uh transportation sparity?
• This is in a teacher uh reduction.
• <00:56:07.839> some<00:56:08.160> reduction<00:56:08.559> in reduction some reduction

Keywords: 1187, senate, all

Transcript Highlights:

• We know that we've got a $6 billion deficit that is looming even after spending the $18 billion surplus
• after raising taxes and fees on all Minnesotans over the last two years, we know that we have that deficit
• We know that we've got a $6 billion deficit that is looming even after spending the $18 billion surplus
• We know that we've got a $6 billion deficit that is looming even after spending the $18 billion surplus
• We know that we've got a $6 billion deficit that is looming even after spending the $18 billion surplus

Keywords: 1183, house

Transcript Highlights:

• It's still going to account for the goals of GHG reductions.
• It's still going to account for the goals of GHG reductions.
• The fiscal condition of deficit would move out to fiscal year 2030-31.
• Without the proposal, we would project a deficit in 2029-30.
• A $3 million deficit is net of drawing from reserves, so that the current actual deficit is larger than

Keywords: 987, senate, all

Summary: The subcommittee heard an overview of the Governor’s housing reorganization proposal and trailer bill language that would consolidate several affordable housing finance programs under the new Housing Development and Finance Committee (HDFC). Administration officials said the plan is intended to create a one-stop application and award process, reduce duplication, and pair state subsidy with private activity bonds and federal tax credits so projects can move from award to construction more quickly. The proposal would also shift some positions and reallocate portions of the Affordable Housing and Sustainable Communities program and other housing funds. The Legislative Analyst’s Office said the concept has merit but raised concerns about the proposed bond set-aside floor and recommended more flexibility and earlier reallocation of unused bonds. Several senators questioned the structure and, especially, the proposed changes to the climate-related ASIC program, arguing that it could weaken the program’s original transportation-and-housing integration and that the budget lacks enough direct funding for core housing production programs. The item was held open. The committee then received an update from the California Debt Limit Allocation Committee and the California Tax Credit Allocation Committee on federal tax credit changes and state housing finance tools. Staff explained that federal H.R. 1 increased the 9% low-income housing tax credit allocation and reduced the bond-financing threshold for the 4% credit from 50% to 25%, allowing California to finance many more projects. They reported that emergency regulations were adopted quickly to implement the new federal rules, resulting in awards for 195 projects and more than 25,000 units in the 4% program, while the 9% program funded 58 projects and nearly 3,000 units. Members discussed the importance of state enhanced low-income housing tax credits, with committee questions focused on how much additional leverage state credits provide and how they help fill remaining financing gaps. The final portion of the hearing focused on the Civil Rights Department’s response to federal civil rights policy changes and on three programs facing the end of limited-term funding: California vs. Hate, the Community Conflict Resolution Unit, and Investigations and Conciliation Enhancement. Director Kevin Kish said federal civil rights enforcement has been weakened by closed offices, shuttered programs, and reduced support for fair housing organizations, while CRD’s open caseload has grown from about 8,700 to more than 12,000 matters. He said the department is using overtime, triage, and process reengineering to manage the surge and to direct people to the right services. Senators expressed strong support for continuing the programs and concern that California is being asked to do more with less as federal protections erode. No votes were taken on the informational items, and the committee discussed the vote-only budget requests for CRD separately.

Transcript Highlights:

• And now we're in a deficit year.
• Since 2020, the department has absorbed $29.1 million in those reductions.
• So when considering those reductions, the department has effectively received only $5.3 million since
• Second, this information about the base efficiency reductions that the department has taken over the
• The federal government has not had the courage to do that, which is why we now have a budget deficit

Summary: The committee first heard a DMV budget presentation on the state-to-state verification system required for Real ID compliance and the Digital Experience Platform (DXP) modernization project. DMV officials said the state-to-state system is a pointer-based exchange used when a person applies for a license in another state, with only limited identifying data shared initially and the full driver history sent only after a qualified request. Members raised concerns about privacy, possible misuse by other states or federal actors, notification to Californians, hacking, and whether California could detect or stop abusive access. DMV said it can monitor requests, see patterns of access, work with AAMVA and legal counsel, and seek to block or challenge misuse; LAO said California is in a difficult position and should consider guardrails rather than opt out. On DXP, DMV said the project is on its revised schedule and budget, occupational licensing is complete, vehicle registration is expected by the end of calendar year 2026, and the full system should be finished by fiscal year 2028-29, with phased rollout and reappropriated funding to keep costs controlled. The committee then heard from the California High-Speed Rail Office of Inspector General on a trailer bill and AB 1608. The Inspector General said current law does not clearly authorize public reports or establish a framework for retaining and disclosing work papers, and the proposed trailer bill would create that framework while also adding authority to hire needed classifications and purchase goods and services. He also said the office needs a clearer statutory definition of “proposed agreements” and notice when the High-Speed Rail Authority is reviewing them, so the office can review contracts and related agreements effectively. LAO raised no concerns with the trailer bill language, and Finance said any amendments would come in the May revision. Members debated the scope of confidentiality in the Inspector General proposal, especially whether reports could be held confidential when they identify weaknesses in fraud controls, security, or other vulnerabilities. The Inspector General said confidentiality would be temporary, tied to articulating the risk, reassessing it every 120 days, and releasing the report once the risk is no longer substantial; he also said the office had already published reports at its discretion and had found at least one procurement violation involving an amendment that added services not in the original contract. Several members pressed for stronger transparency and suggested time limits or broader disclosure, while others argued the bill would improve oversight and make the Inspector General’s authority clearer. No votes were taken during the discussion, and the item was left for further work on the trailer bill and AB 1608 language.

Transcript Highlights:

• In most cases, there were reductions for various different reasons.
• I do understand if what you're saying is that we have structural deficits.
• Cases these reductions do help with structural imbalances.
• So, I mean, I think the DPR fund is not in a structural deficit.
• I think you use special funds to take care of the deficit to backfill.

Keywords: 987, senate, all

Summary: The subcommittee heard an extensive discussion on the Governor’s proposal to eliminate vacant positions across several environmental and natural resources departments, including Fish and Wildlife, Parks, the Coastal Commission/BCDC, DPR, DTSC, CalRecycle, and the State Water Resources Control Board. The Legislative Analyst’s Office explained that the JLBC had already not concurred with 650 of roughly 1,000 positions under review, citing concerns that many of the vacancies support core functions such as law enforcement, permitting, public safety, sea-level rise planning, and implementation of recently enacted laws. The Department of Finance defended the vacancy reduction exercise as a way to capture savings from a statewide pool of about 40,000 vacancies, arguing that departments need flexibility to manage operations and that some vacancies are used to cover operating costs or hard-to-fill roles. Several department representatives testified that the cuts would reduce capacity and could slow permitting or enforcement, though they said they would try to reclassify positions and prioritize the highest-need work. No vote was taken and all items were held open for a future hearing. Members focused heavily on the practical effects of the cuts. Senators questioned whether vacant positions should be treated as a budget savings tool, whether special-fund positions should be eliminated when they do not affect the General Fund, and whether long-vacant positions should simply be removed if they have not been filled for years. Fish and Wildlife and Parks described impacts to permitting, wildlife conflict response, and law enforcement; Parks said its academy can train only about 50 rangers a year, leaving many vacancies even after the proposed reductions. The Coastal Commission said the affected positions support SB 272 sea-level rise planning with local governments. DPR said the proposed cuts would affect multiple branches involved in pesticide registration, enforcement, and safety review, while DTSC said it was still hiring from a large 2022 reform package and had reduced its vacancy rate from about 30 percent to 15 percent before the drill. The State Water Board said its proposed reductions would be spread across programs and could lead to slower permitting and backlogs, though it would protect drinking water functions as much as possible. The committee then moved to a State Water Resources Control Board overview and a new budget proposal tied to the U.S. Supreme Court’s Sackett decision. Chair Esquivel described the board’s responsibilities for water quality, water rights, drinking water, and financial assistance, and said the board is updating the Bay-Delta Plan while also pursuing voluntary agreements and broader water-rights administration. He said federal workforce reductions and the Sackett ruling have increased pressure on state programs. The board requested $2.6 million and 12 permanent positions from the Waste Discharge Permit Fund to address permitting and enforcement gaps created by the narrowing of federal Clean Water Act jurisdiction. The LAO said the request met its high bar for new proposals because it was supported by the board’s data and would help maintain water-quality protections, though it noted that state processes are less efficient than the federal framework they are now partially replacing.

Transcript Highlights:

• That would be the first time a BET reduction would take place.
• Doubling the timeline for the BET reductions.
• So the Senate can have tax reductions.
• cutting taxes if we're in a deficit. cutting taxes if we're in a deficit.
• structural deficit structural deficit in<00:31:11.360> New<00:31:11.600> Hampshire.

Keywords: 1189, house, all

Summary: The committee of conference on HB 155 continued discussion of a compromise over business tax relief, small-business filing thresholds, and nursing home funding. Representative Sweeney proposed raising the filing threshold to $400,000 and creating a trigger for future Business Enterprise Tax reductions if business tax revenues produce a $200 million biennial surplus, with the Department of Revenue Administration commissioner able to exclude one-time or non-sustainable funds. Supporters said the proposal would provide a clear policy direction, immediate relief to about 4,500 small and micro businesses, and a future path back to the BET’s original 0.25% rate. Opponents, led by the Senate side, argued the trigger language was premature, better handled in a budget year with more revenue data, and inappropriate to decide in a short conference committee meeting. The Senate also emphasized that the tax policy should not be locked in without a fuller public process, while House members argued the trigger would not take effect until a future biennium and was therefore a prudent way to signal New Hampshire’s direction on taxes. A separate point of discussion involved nursing homes: the House said its report would include $2.5 million for nursing homes with non-lapsing language, and senators stressed the importance of that funding for the health care system and county property taxpayers. One senator warned that triggers could encourage revenue underestimation and noted bond rating concerns about a structural deficit. Several motions were made to accept the Senate position with the $400,000 threshold and related amendments, but the first motion failed on a party-line style split, with the Senate voting yes and the House voting no. A second House motion to accede to the Senate position while also including the nursing home funding, the threshold increase, and the future trigger language was also rejected by the Senate. The meeting ended with the report filed without agreement on the trigger language, and the transcript then notes a separate reconvened committee of conference on HB 751 being postponed until 12:30 the next day.

Transcript Highlights:

• It cut it added $4 trillion to the deficit for those deficit hawks out there. $4 trillion to the deficit
• > hawks to the deficit for those deficit hawks to the deficit for those deficit hawks out<00:56:38.400
• $4 trillion to the deficit. $4 trillion to the deficit.
• Um, we've heard a Tabke 2475 and 2715 copay reductions.
• Um, we've heard a Tabke 2475 and 2715 copay reductions.

Keywords: 1183, house

Summary: The House convened with prayer, the Pledge of Allegiance, roll call, and approval of the previous day’s journal. The chamber received Senate messages announcing a joint convention for the governor’s message and transmitting Senate Files 1251, 3769, and 3868. The House also introduced House Files 4868 through 4933 and adopted committee reports and comparison report motions without objection. The Rules Committee placed several bills on the calendar and required pre-filing of amendments for specified measures. On the calendar, the House passed Senate File 3602, which enacts the Uniform Electronic Estate Planning Documents Act and expands electronic signing to estate planning documents beyond wills. Supporters said it would help people who are homebound, hospitalized, or in rural areas and reduce uncertainty for banks and hospitals about electronically signed powers of attorney and health care directives. The bill passed 134-0. The House also passed House File 3516, a Board of Dentistry policy bill that updates licensure language, allows retired dentists to serve low-income uninsured patients, and increases the number of dental hygienists a dentist may collaborate with from four to eight; it passed 134-0. The House then passed House File 3528, a technical barbering bill that reduces training and retesting burdens, gives the board more testing flexibility, repeals duplicative rules, clarifies that waxing is not barbering, and makes other fee and registration changes; it passed 134-0. House File 3718, updating veterinary medicine and veterinary technology statutes, was amended to restore board seal language and then passed 134-0 as amended. Supporters said it modernizes definitions and standards, recognizes licensed veterinary technicians, and may help address veterinary shortages, especially in greater Minnesota. Finally, the House passed Senate File 3402, which broadens who may serve as a medical consultant for Community Health Boards to include additional licensed professionals such as DOs, physician assistants, and advanced practice registered nurses; it passed 134-0. The chamber also considered several motions to move bills between committees, including referrals involving veterans, education, health, and psilocybin-related legislation. A motion to suspend the rules for House File 4487 was presented, and the bill was described as providing a one-time $1 billion property tax rebate or credit, but the transcript cuts off during extended debate on that motion before any final disposition is shown.

Transcript Highlights:

• That is charged if a deficit remains after the surcharge is applied.
• Again, it is charged until the deficit is eliminated.
• If you all decided to retire a deficit early, you could do that.
• You mentioned also that litigation, reduction in litigation.
• So if you have a reduction, a major reduction in litigation, why such a big rate increase?

Summary: The Insurance and Banking Subcommittee received a lengthy presentation from Citizens Property Insurance Corporation CEO Tim Serio, with Insurance Commissioner Michael Yaworski also answering questions. Serio reviewed Citizens’ role as Florida’s insurer of last resort, its statutory funding structure, eligibility rules, depopulation program, reinsurance obligations, and the surcharge/emergency assessment mechanisms that can be used if Citizens runs a deficit. He emphasized that recent legislative reforms, combined with lower litigation and improved market conditions, have helped the private market recover and reduced Citizens’ policy count from a peak of about 1.41 million in 2023 to 936,182 at the end of 2024, with a projected drop to about 771,000 by the end of 2025. He also said the reforms reduced Citizens’ rate need and helped avoid an emergency assessment after the 2024 storms. Members asked about Citizens’ rate increases, why Citizens still seeks higher rates despite lower litigation, how the 20% eligibility threshold works, whether Citizens should be wind-only, and whether the state or federal government could help with deficits. Serio explained that Citizens is still charging below actuarially sound rates in most areas, that rate filings reflect reduced litigation and lower reinsurance exposure, and that assessments on all Florida property policyholders are the reason Citizens tries to build surplus and depopulate. He said the depopulation program is working better than in the past, with less than 2% of takeout policies returning to Citizens, and that the Office of Insurance Regulation has been vetting takeout companies more carefully. A substantial portion of the discussion focused on claims handling after Debby, Helene, and Milton, including flood-versus-wind disputes and Citizens’ use of the Division of Administrative Hearings for some claim disputes. Serio said Citizens had received 76,625 claims from the three storms and had paid nearly $823 million in indemnity and expenses as of January 7, 2025. He said many closed-without-payment claims were either below deductible, withdrawn, duplicate, or flood-only, and that Citizens had asked its internal audit function to independently review the claims data and denials. He also described Citizens’ storm outreach, catastrophe response centers, managed-repair program, and claim review process, and said the corporation remains focused on paying valid claims while minimizing the risk of assessments on the broader Florida market.

Transcript Highlights:

• We are now looking at a $6 billion deficit.
• This is time six billion dollar deficit.
• reduction in the spending so that we can reduction in the spending so that we can go<00:12:05.519>
• We now know that there is a $6 billion deficit.
• let's<00:21:29.520> address $3.2 billion deficit, let's address $3.2 billion deficit, let's

Keywords: 1183, house