Transcript Highlights:

• Funding was cut at the federal level.
• administration, chose to expand.
• Is any of the current money that we put into the Administrative Office of the Courts coming from federal
• The federal government also offloaded a great deal of administrative responsibility for the program for
• I think, Madam Chair, the federal poverty level is the 400 percent of federal poverty level.

Committee: House House Appropriations & Finance

Transcript Highlights:

• ><00:45:58.480><c> or</c><00:45:58.720><c> regulation</c> federal law, federal rule or regulation federal
• It changes from administration to administration.
• ><c> federal</c> is that when the federal the federal is that when the federal the federal government
• </c><01:34:45.920><c> rule</c> federal guidelines or no federal rule federal guidelines or no federal
• </c><01:36:35.040><c> federal</c> incorporate what the federal federal incorporate what the federal federal

Summary: The Alabama Senate convened with a prayer by Pastor Jeremy Ward and the Pledge of Allegiance led by Sophia Woods. A quorum was established with 27 senators present, and the Senate adopted routine motions to excuse absent senators, dispense with the previous day’s journal, and allow bills and committee reports to be introduced throughout the day. The chamber also referred Executive Message 69, appointing Brandy Williams to the Alabama Fire College and Personnel Standards and Education Commission, to the Committee on Confirmations. The Senate received several Judiciary Committee reports. House Bills 41 and 149 and Senate Bills 230, 87, 169, 238, and 233 were reported favorably, with amendments on Senate Bills 87, 169, and 233. Those measures received second reading and were placed on the calendar for the next legislative day. The Senate also adopted Senate Joint Resolution 31, commending Mackenzie Grace Stigel, and Senate Joint Resolution 32, recognizing the Alabama School of Mathematics and Science for its national ranking; guests from the school were welcomed in the gallery. The Rules Committee report was then adopted by a 33-0 vote, setting a special order calendar that included Senate Bill 71 on administrative rules, along with several other bills on dredging, county subdivisions, legislative matters, public corruption, rural hospital investment, minority affairs, campaign finance, and natural resources. The chamber then took up Senate Bill 71, the “sound science” bill, which would limit state agencies from adopting environmental rules more stringent than federal law and require science-based standards where federal law is absent. Senator Coleman-Madison offered an amendment to preserve stronger scientific and causal standards, arguing the bill could weaken protections in heavily burdened communities; the amendment failed on a roll call vote of 25 nays to 1 yea. Senators then continued debating the bill’s effect on ADEM’s authority, emergency rulemaking, federal standards, and environmental enforcement in Alabama.

Transcript Highlights:

• ,</c><00:19:18.240><c> which</c> theme of the Jewish Federation, which theme of the Jewish Federation
• ><c> is</c> Now, the Trump administration is Now, the Trump administration is reportedly<02:12:04.400
• . administration. administration.
• Rather than empower border enforcement, the Biden-Harris administration threw open the federal checkbook
• Rather than empower border enforcement, the Biden-Harris administration threw open the federal checkbook

Transcript Highlights:

• More or less, this would require and at the federal level, the Trump administration has really talked
• That would need to be initiated by the federal government, and the federal government, I think up to
• </c> federal government, and the federal federal government, and the federal government,<00:06:41.200
• </c> federal policy. federal policy.
• </c> main federal holding facilities. main federal holding facilities.

Committee: House Public Safety Finance and Policy

Transcript Highlights:

• </c> administration might be working on. administration might be working on.
• </c> I don't think that bill, the federal I don't think that bill, the federal bill,<00:10:11.040><c>
• </c><00:15:00.160><c> level</c> able to advocate at the federal level able to advocate at the federal
• </c> federal level? federal level?
• </c> there not be a federal solution? there not be a federal solution?

Summary: The 2025 Artificial Intelligence Task Force met for its first meeting of the year and heard updates on federal AI policy, state implementation of Senate Bill 4, and the business community’s perspective on AI regulation. Co-chairs noted that federal legislation could affect the task force’s work later in the year, but said Kentucky still has significant issues to study, including energy, land use, education, social media, and children’s engagement with AI. The task force had quorum and no votes were taken. Kate Shanks of the Kentucky Chamber said the business community supports continued discussion but favors a federal approach over a patchwork of state laws. She described the Trump administration’s new AI executive order as emphasizing innovation over regulation, noted the pending federal AI action plan, and discussed congressional action including the Take It Down Act and industry-specific changes to existing laws. She warned that state-by-state AI rules could increase costs and burden businesses, and said the Chamber would prefer incremental, flexible policy that avoids conflict with existing law and limits private rights of action. Members asked about uniform model legislation, education uses of AI, and civil liability; Shanks said a model approach could help avoid fragmentation and that liability should generally be handled through consumer-protection-style enforcement rather than broad litigation. The Commonwealth Office of Technology then reported on implementation of SB 4, saying it has worked with industry, agencies, other states, and vendors to build an AI policy framework now in final review. Officials said an AI Governance Committee has been established and will meet in July, and a draft RFP is being prepared to meet the bill’s tracking and documentation requirements. They said no major implementation challenges have been identified so far, but the impact of pending federal rules remains uncertain. Members also discussed the need to educate students and teachers about AI, with one member emphasizing that schools should teach both how to use AI and how to think critically about information online.

Transcript Highlights:

• portion of Access in a manner called an administrative services organization.
• Access provides federal dollars to help care for low-income and disabled people, but because of federal
• DDD and ALTCS have federal Medicaid funding. SMI people don't.
• Another placement had no medication administration help.
• My understanding is federal law supersedes state law.

Committee: Senate Senate Health and Human Services COR

Summary: The committee first approved the February 4 minutes, then heard Senate Bill 1086, which would require AHCCCS contractors to reimburse non-contracting providers for certain lab services when a member was referred by a contracting provider and would bar prior authorization for diagnostic services. The sponsor said the bill was intended to address unpaid claims and improve access, while Access testified neutral but warned the prior-authorization ban could increase utilization and create a fiscal impact. The committee adopted the Warner amendment limiting non-contracting reimbursement rates to no more than contracting rates, then passed SB 1086 as amended on a 4-2 vote. The committee then took up Senate Bill 1611, an emergency measure to require Access to contract with an administrative services organization for the American Indian Health Plan, while keeping Access ultimately responsible for administration. The chair’s amendment expanded ASO duties to include provider support, quality improvement, and data analytics, removed Access claims-payment authority, added tribal observers to the selection committee, and exempted IHS and tribal-facility services. The sponsor and tribal witnesses described the bill as a response to fraud, provider nonpayment, and harm to Native communities, while Access raised concerns about the fast timeline, tribal consultation requirements, possible duplication of program-integrity functions, and fiscal uncertainty. After debate over the emergency clause and tribal consultation, the committee adopted the amendment and passed SB 1611 as amended on a 5-2 vote. The committee also heard Senate Bill 1630, which would direct Access to seek federal approval for a Medicaid home- and community-based services program for adults with serious mental illness. Supporters said the bill would create a long-term community-care option for the sickest SMI members, reduce cycling through hospitals, jails, and homelessness, and potentially save state general fund dollars; family members and advocates testified in support. Access was neutral and said it was finalizing a fiscal estimate. The Angus amendment narrowed eligibility to long-term SMI, reduced the enrollment cap from 500 to 250, changed reporting to semiannual, and removed priority-order language; the committee adopted the amendment and passed SB 1630 as amended unanimously. Later, the committee passed Senate Bill 1193, which protects emergency medical care technicians’ personal identifying information from sale or disclosure by the Department of Health Services, after adopting a clarifying amendment expanding the protected information and addressing commercial requests. It then heard Senate Bill 1318, which repeals the state’s separate dense-breast notification requirement so Arizona law aligns with the FDA’s newer mammography notice standard; the sponsor and DHS said the change would reduce confusion from duplicate, slightly different notices, and the bill was moving forward with discussion of possible future amendment language.

Transcript Highlights:

• Federal funds are 7%.
• funds due to expired federal grants.
• funds due to expired federal grants.
• Federal funds are increasing by $15.1 million, which is the net effect of the decrease in federal funds
• So those have a more favorable federal match. That explains most of the federal decrease, not all.

Committee: House Appropriations

Summary: The committee first heard a budget presentation on LSU Health Care Services Division and Lallie Kemp Medical Center. Staff reviewed HCSD’s roughly $74.7 million budget, much of it tied to legacy obligations for former LSU hospital systems and support for Lallie Kemp. Committee members asked about prisoner care, risk management costs, declining admissions and emergency visits, and the hospital’s 340B drug program. Lallie Kemp officials explained that prisoner care serves multiple state and local facilities, that lower admissions largely reflect more patients being placed in observation status, and that the in-house 340B program provides major savings to patients and the prison system. Members also asked about care for unhoused patients and the hospital’s discharge practices, and the hospital said social services works to find placement when possible. The committee then moved to the Louisiana Department of Health budget, which was presented as just under $23.5 billion, with Medicaid making up more than 90 percent of the total. The presentation covered the Office of the Secretary, Office of Public Health, Office of Behavioral Health, Office for Citizens with Developmental Disabilities, and Medicaid. Major items included the new Rural Health Transformation Program, the transfer of several functions from DCFS to LDH under the One Door initiative, changes to SNAP administration, and large Medicaid adjustments driven by enrollment, utilization, and federal policy changes. Testimony also highlighted the statewide crisis hub and 988, the commodity food program for seniors, women’s health and maternal outcomes, and the department’s efforts to modernize technology and reorganize services. Members questioned LDH officials on a wide range of budget and policy issues, including the rural health grant, crisis services, Medicaid redeterminations, provider taxes, physician and hospital supplemental payments, nursing home rates, HCBS funding, and the impact of the federal One Big Beautiful Bill Act. LDH said the rural health grant would support workforce, technology, and care-delivery improvements; that the crisis hub and mobile crisis units are being expanded to improve access and reduce emergency room use; and that the department is working to keep the SNAP error rate below 6 percent to avoid a projected state cost increase. Officials also said they expect to return next year with additional funding requests for HCBS and other programs, while emphasizing that current budget changes are largely meant to realign funding with actual expenditures and new federal requirements. No votes or formal actions were taken in the portion provided.

Transcript Highlights:

• You mentioned the federal government.
• And for me, when I think about all of the things that this administration has done that other administrations
• Obviously, there's a lot of attention to what the federal administration is seeking to do with California's
• And lastly, I did want to mention that federal delay And lastly, I did want to mention that federal delay
• Additionally, the federal funding landscape and uncertainties surrounding the consolidation of federal

Summary: The Assembly Budget Subcommittee on Climate, Crisis, Resources, Energy, and Transportation opened its first hearing on the governor’s natural resources budget with Secretary Wade Crowfoot of the Natural Resources Agency. Crowfoot reviewed California’s recent climate and environmental challenges—drought, wildfire, heat, sea level rise, and federal uncertainty—and highlighted progress on clean energy, zero-emission vehicles, wildfire resilience, water management, coastal planning, conservation, tribal land return, and streamlined project delivery. Members praised his engagement and the administration’s work with tribes, and Crowfoot emphasized that the administration is focused on finishing major projects, improving nature-based solutions, and considering whether some temporary streamlining measures should be codified. He also discussed the Mediterranean Climate Action Partnership and said the state is working with other Mediterranean-climate governments on wildfire, drought, and heat response. Members and the LAO then focused on budget conditions and priorities. The Legislative Analyst’s Office said the state budget remains precarious despite strong revenues, with the governor’s proposal relying on borrowing and reserves and leaving large out-year deficits unresolved. The LAO urged a high bar for new spending, especially in a deficit environment, and recommended prioritizing immediate health and safety needs, avoiding new ongoing commitments, and thinking carefully about special funds. On Proposition 4, the LAO said the administration’s approach generally appeared reasonable and consistent with the bond, but noted implementation has been slow and that the Legislature may want to use appropriations language to shape broad programs such as home hardening, outdoor recreation, and climate education. The chair stressed that climate and environmental funds should be used for their intended purposes and that wildfire spending should shift more toward community hardening and home protection. The hearing then turned to water resilience and Proposition 4 spending. Department of Finance and department staff outlined the bond’s water-related funding for safe drinking water, drought, flood, water recycling, stormwater, groundwater management, dam safety, and the State Water Project. Members pressed for details on how funds would be prioritized, how grants would reach disadvantaged communities, and how the state would track the bond’s 40% target for vulnerable communities. Staff said new tools and reporting systems are being used to monitor allocations, and that AB 107 and related changes should speed up grant implementation by reducing redundant regulatory steps. The committee also discussed dam safety needs, State Water Project repairs, groundwater implementation grants, and the risk of relying on uncertain future revenues from the Salton Sea lithium tax. No votes were taken, and the hearing was informational only.

Transcript Highlights:

• </c><00:09:19.040><c> and</c> compliance with applicable federal and compliance with applicable federal
• </c><00:09:47.320><c> rules</c> things USDA also writes Federal rules things USDA also writes Federal
• federal federal regulations<00:17:53.280><c> for</c><00:17:53.559><c> example</c><00:17:54.320><c> mde
• </c> served another requirement under federal served another requirement under federal law<00:24:39.520
• </c><00:27:07.840><c> reviews</c> resulting from administrative reviews resulting from administrative

Committee: House Education Policy

Transcript Highlights:

• While the federal administration has attempted to justify these cuts with arguments that the funds were
• But as if that wasn't enough of an attack on California's health care system, the federal administration
• The administration is evaluating the significant administrative workload associated with the implementation
• The administration is evaluating this.
• Families are living in fear of federal immigration efforts.

Transcript Highlights:

• In the last year, we have seen federal funding In the last year, we have seen federal funding frozen,
• cuts, federal cuts, but we have to look at kind of what the root cause of those federal cuts are, and
• Yes, we have been impacted by those federal cuts. We receive money from the federal government.
• Yes, we have been impacted by those federal cuts. We receive money from the federal government.
• Given the increasingly hostile federal administration towards the rights of LGBTQ communities, specifically

Committee: Joint Joint Committee on Ways and Means

Summary: The hearing was a Joint Committee on Ways and Means budget session on health and human services, held in Clinton and opened with remarks from the House and Senate co-chairs, local officials, and committee members. The chairs emphasized the importance of hearing directly from agencies about the Commonwealth’s health care and human services budget needs, thanked Clinton for hosting, and introduced the day’s panels, beginning with the Executive Office of Health and Human Services (EOHHS) and then MassHealth. Secretary Kiame Mahania presented Governor Healey’s FY27 EOHHS budget, describing a $33.7 billion request driven largely by non-discretionary cost growth, caseload increases, and federal uncertainty. He highlighted targeted investments in foster parent reimbursement, family resource centers, maternal health, food assistance, immigrant legal services, and workforce rates, while warning that federal cuts and the Trump administration’s One Big Beautiful Bill Act could strip billions from state health funding. Members questioned him about primary care shortages, federal program integrity audits, ConnectorCare, regional health disparities, and the proposed cap on adult dental coverage; he defended the cap as a difficult but necessary cost-control measure and said the administration would continue cooperating with federal partners. Undersecretary Michael Levine then testified for MassHealth, saying the agency faces two major challenges: rapid cost growth and looming federal changes. He outlined a $22.7 billion gross MassHealth budget and proposed actions including a moratorium on new expansions, capping adult dental benefits at $1,000, ending GLP-1 coverage for weight loss only, reducing care management spending to peer-state levels, and convening work groups to slow growth in personal care attendant, adult foster care, and adult day health programs. He also warned that federal policy changes could cause about 300,000 residents to lose coverage by 2030 and reduce federal revenue by about $3.5 billion, and said MassHealth would use outreach and systems changes to help eligible members stay covered. Members raised concerns about the impact of these cuts on homeless care, preventive services, dental access, GLP-1s, and regional hospital and specialist shortages, while Levine argued the proposals were aimed at preserving core coverage and sustainability.

Transcript Highlights:

• in different federal administrations.
• administrative hurdles.
• Act, under federal law...
• Court said weren't legitimate under the Administrative Procedures Act, under federal law, are actually
• We still do not have detail from the federal government.

Committee: Joint Joint Select Committee on Health Care and Behavioral Health Oversight

Summary: The committee first welcomed new DSHS Secretary Angela Ramirez, who described her background in public service and emphasized collaboration, relationships, and responsiveness to legislators as she begins her tenure. Members thanked her and noted they looked forward to working with her on the governor’s priorities and the state’s budget and service challenges. The committee then heard a presentation on the West Coast Health Alliance from Governor’s Office, Department of Health, and state health leadership. Witnesses said the alliance was formed by Washington, Oregon, California, and Hawaii to provide unified, science-based public health guidance, especially on vaccines, amid federal instability and misinformation. They said the alliance has already issued vaccine recommendations and statements rejecting a vaccine-autism link, and is working on return-to-work guidance and responses to federal ACIP actions. Members asked about workload and coordination with an East Coast public health group; witnesses said the main challenge is communicating unified guidance rather than reviewing studies themselves. Next, the Washington Health Benefit Exchange reported on open enrollment and the effects of federal changes, including the expiration of enhanced premium tax credits and HR1 provisions affecting immigrant eligibility and future auto-renewal rules. Officials said premium increases are driving some customers to drop coverage, while state actions such as silver loading and Cascade Care Savings are helping blunt the impact for many enrollees. They also described outreach through navigators, brokers, tribal organizations, and community groups, and noted rising website traffic and more customer questions during open enrollment. Members asked about enrollment trends, carrier participation, and how to communicate upcoming federal changes. Finally, the Health Care Authority and Office of the Insurance Commissioner reviewed the state’s health reform history and the impact of federal changes on Medicaid and the individual market. They highlighted ongoing state efforts on affordability, prescription drug oversight, primary care and behavioral health access, preventive services, and rural health funding. Witnesses said agencies are coordinating across DSHS, HCA, OIC, the Exchange, Employment Security, and others to prepare for Medicaid work requirements and other HR1 changes, while also trying to reduce administrative burden and preserve access to care. No votes were taken.

Transcript Highlights:

• I think that as hard as all these changes in the federal administration are hitting our communities,
• I think that as hard as all these changes on the federal administration are hitting our communities,
• Whether people agree with it or not, the federal administration is moving forward, and they are moving
• our states to enforce right whether people agree with it or not the federal administration is moving
• SNAP are shifting costs to the state, and new federal policies have increased the administrative burden

Committee: Joint Joint Committee on Ways and Means

Summary: The hearing was a FY27 budget session on Health and Human Services held in Mattapan, hosted by the Joint Committee on Ways and Means. Opening remarks from Senator Lydia Edwards, Representative Brandy Fluker-Reed, Representative Russell Holmes, and Boston Public Library President David Leonard emphasized the significance of holding the first Ways and Means hearing in Mattapan, the importance of community access, and the role of libraries as human services institutions. Committee members and attendees introduced themselves before agency testimony began. MassAbility testified first, describing its mission to support people with disabilities through employment, independent living, and disability determination services. The agency highlighted federal funding uncertainty, a modest FY27 budget reduction, and a proposed reworking of its home care program, which it said is outdated and should better target those most in need. Members questioned the home care cut, staffing reductions, and federal coordination. MassAbility also shared a participant story about recovery and community support to illustrate the impact of its services. The Massachusetts Commission for the Deaf and Hard of Hearing then presented its FY27 request, focusing on interpreter and captioning access, workforce development, emergency communication, aging-related hearing loss, and transition services for deaf and hard-of-hearing youth. Members asked about interpreter shortages, after-hours emergency coverage, ASL education, and community training; the commission said it is expanding mentorship and referral systems but still faces staffing and vendor challenges. The Massachusetts Commission for the Blind followed with a $30.8 million request, describing services for nearly 9,000 consumers, peer support groups, vocational rehabilitation, and Turning 22 services, while noting federal funding uncertainty and a 7% budget cut. Members raised concerns about maintaining services with fewer resources, and the commissioner said the agency had trimmed overhead and could manage the proposal. The Office for Refugees and Immigrants closed the segment, outlining expanded legal, housing, workforce, citizenship, and financial literacy supports for immigrants and refugees, including Know Your Rights trainings, legal defense initiatives, and the Massachusetts Access to Counsel Initiative. Members discussed the effects of federal policy changes, the loss of refugee resettlement funding, and the need for state support to fill gaps. No votes were taken in the portion provided; the hearing consisted of agency presentations and committee questioning.

Transcript Highlights:

• level with federal funds, et cetera.
• A lot can happen between now and enactment of the federal budget.
• Administration.
• Our federal membership organization has been asked whether this administration that sits under the Department
• This could lead to federal funding reductions again for VR services.

Summary: The Assembly Budget Subcommittee on Human Services held a hearing on developmental services, rehabilitation, and related supports, with no votes taken. The first major topic was the Master Plan for Developmental Services. Administration officials described a year-long, community-driven process that included a steering committee, work groups, and statewide engagement sessions, and said the final draft would be released that Friday with about 170 recommendations. The Department of Developmental Services said the plan would inform future work, but did not offer a detailed implementation roadmap. The LAO said the plan contains significant policy and budget implications, may require statutory changes, and needs further analysis to turn recommendations into actionable proposals. Advocates and regional center representatives urged the Legislature and administration to avoid letting the plan sit on a shelf, called for prioritization and ongoing stakeholder oversight, and emphasized the need to address equity, workforce, service coordination, and cross-system collaboration. The chair said he wanted to work with the LAO on trailer bill language and future reporting to create a clearer path forward. The second topic was the Office of Employment First and competitive integrated employment. Administration witnesses said California has ended subminimum wage under SB 639, but that moving people into competitive integrated employment remains a major priority. They described existing efforts such as DDS’s coordinated career pathways pilot, paid internships, job development services, benefits counseling, and DOR’s career counseling and referral services, along with pilot projects in San Diego and Orange County. The State Council on Developmental Disabilities and advocates argued that employment outcomes have remained stuck at roughly 15% and that a dedicated Employment First Office is needed to coordinate across agencies, align goals, and improve outcomes. The LAO recommended regular legislative oversight on people transitioning out of subminimum wage and asked for technical assistance on coordinated career pathways. The chair criticized the administration’s decision to effectively eliminate funding for the office, requested a detailed implementation timeline and quarterly transition reports, and said the committee would continue pressing for the office to be implemented. The final issue was respite services, utilization trends, and access. DDS reported that in-home respite use and spending have risen sharply over several years, with about 150,000 people using respite in 2023-24 and expenditures reaching about $1 billion. Officials said access depends on families knowing the service exists, service coordinators identifying need, and having enough providers, especially in rural and linguistically diverse communities. The San Diego Regional Center said utilization generally mirrors statewide trends, but access is stronger in some areas, such as Imperial County, where families often prefer family-directed or agency-supported models that allow them to hire trusted workers. Committee members emphasized the importance of respite for family health and caregiver well-being, asked whether service coordinators are asking practical questions about sleep and stress, and discussed the need for better identification of complex behavioral and medical needs. DDS said a standardized family support tool and updated IPP process are intended to improve consistency, transparency, and person-centered assessment for respite and related services.

Transcript Highlights:

• </c> there's an internal or administrative there's an internal or administrative inquiry<00:10:02.720
• </c> program we may take administrative program we may take administrative action<00:27:09.480><c> as
• <00:43:56.359><c> or</c><00:43:56.680><c> beh</c> administration or beh administration or beh behavior
• In 2019, we've strengthened administrative sanctions by expanding the use of administrative sanctions
• In 2019, we've strengthened administrative sanctions by expanding the use of administrative sanctions

Committee: House Fraud Prevention and State Agency Oversight Policy

Transcript Highlights:

• You'll see in the green bar that's the federal share.
• That's the federal share.
• from the state in federal funding per quarter.
• Federal standard is 45 days.
• Federal standard is 45 days.

Committee: House Human Services Finance and Policy

Transcript Highlights:

• Trump accounts, from state taxable income conforming with federal law.
• Many veterans go to federal facilities, or they will receive funds directly from the federal government
• But that's a core area of federal responsibility. That is something that the federal government...
• And to say that it's the responsibility of the federal administration to make sure that we're prioritizing
• Finally, again, thank you to our partners at the administration.

Committee: House Budget

Transcript Highlights:

• preemption directive, ...been the federal preemption directive from the executive order at the federal
• Has the federal government done anything, I guess, is done?
• Nor are they as dependent upon federal contracts and things like that.
• Things are happening at a federal level.
• Things are happening at a federal level.

Transcript Highlights:

• With the federal administration recklessly reducing staffing at the Internal Revenue Service of its tax
• While student loans have been moved now to the Small Business Administration, as of yet, no new administrative
• We don't make money like the federal government.
• administration.
• However, the federal timelines don't seem to normally be adhered to, even in prior administrations.

Summary: The Assembly Budget Subcommittee on Accountability and Transparency held a hearing focused on three issues: federal funding cuts and delays, possible state revenue impacts from reduced IRS enforcement, and the fiscal effects of AB 218 on local governments. The Franchise Tax Board described how state and federal tax systems are closely linked, how most returns are filed electronically through software, and how FTB relies on IRS information sharing for compliance, fraud prevention, offsets, and nonfiler work. Members raised concerns that federal staffing cuts at the IRS could weaken audits of large corporations and reduce California revenue, and asked about VITA and ITIN filers; FTB said it was not aware of VITA reductions, noted ITIN returns are processed the same as other returns, and said ITIN filing appeared slightly down this year. The Department of Finance said it is monitoring federal developments, summarized the continuing resolution and reconciliation process, and noted that California lost nearly $940 million in earmarked federal projects under the CR, while major federal budget decisions remain uncertain until the President’s budget and later congressional action. The University of California reported substantial federal pressure on research, student aid, and health care. UC said hundreds of millions of dollars in federal awards have already been canceled, with additional threats to NIH and DOE facilities-and-administration rates, graduate fellowships, student loan repayment plans, international student visas, Pell Grants, and Medicaid/Medi-Cal funding. Committee members pressed UC on the effects of DEIA-related federal restrictions, the loss of clinical trials and research staff, and the impact on low-income students and patients. UC said it is pursuing litigation with the Attorney General and other institutions, but emphasized that court action is only a temporary solution and that sustained state and private support may be needed. The second panel addressed the fiscal consequences of AB 218, which extended the statute of limitations for childhood sexual abuse claims against public agencies. FCMAT presented a report with 22 recommendations, including better statewide data collection, financing mechanisms, a possible victims compensation fund, and prevention measures. Los Angeles County described a tentative $4 billion settlement tied to AB 218 claims, saying it will require reserves, borrowing, and long-term annual payments through 2050, while also forcing curtailments and cuts to vacant positions to preserve services. Members discussed insurance pools, retroactive premiums, unidentified future claims, and the need for a compensation fund or other financing tools. No formal votes were taken; the hearing concluded with public comment, including testimony from local health officials about nearly $400 million in terminated federal public health grants and the resulting layoffs and service impacts.

Transcript Highlights:

• The Indirect Cost Recovery Fund includes administrative overhead from federal funds for allowable uses
• a specific federal grant.
• Based on how the administration of the program is slowing down at the federal level, there is now some
• As you all know, our office is predominantly federally funded.
• As you all know, our office is predominantly federally funded.

Summary: The committee first reviewed the Department of Juvenile Corrections budget. Legislative Services analyst Noah Peterson outlined the agency’s funding sources, staffing, recent expenditure patterns, and several FY 2026 and FY 2027 budget requests, including substance use disorder treatment, youth assessment center funding, replacement items, IT upgrades, and a clinician services transfer from the Department of Health and Welfare. Members asked about the governor’s holdback, public works projects, vehicle replacements, and staffing. Director Ashley Dowell said the department’s census has declined due to strong county partnerships, prevention and diversion efforts, and youth assessment centers, and she explained that a staffing analysis found the agency understaffed by 12 positions, with six vacancies converted to direct care roles. She also described the holdback impacts as coming from contract reductions, internal efficiencies, travel and training cuts, and substance use disorder funding adjustments. The committee adjourned after the department discussion. The committee then reviewed the Office of Energy and Mineral Resources budget. Peterson described the office’s mostly federal funding, small staff, dedicated funds, prior energy resilience appropriations, and FY 2027 requests for personnel realignment, Idaho Orchestrating Nuclear (ION) support, and home energy rebates. Administrator Callie Younger said the office is focused on energy resilience, permitting coordination, hydropower relicensing, geothermal and mining projects, and a growing nuclear policy portfolio. She highlighted the new nuclear task force, the office’s request for information to industry, and work on a federal request related to a nuclear lifecycle campus. Members asked about nuclear development, spent fuel, modular reactors, permitting efficiency, and whether the office might merge with the Office of Species Conservation. Younger said the office is exploring a merger because of overlapping permitting functions and could reduce positions and save some general funds, while also improving its ability to handle nuclear and mining work. The chair closed by noting the committee’s alignment with several governor’s office recommendations and adjourned the meeting.