Transcript Highlights:

• of federal funds.
• rather. than the C2 Fund.
• Less in the use of fund balances.
• So overall, they funded 102 funded FTEs for that particular P code.
• On page 303, the Uninsured Employers Fund, the purpose of the Uninsured Employers Fund program is to

Committee: House House Appropriations & Finance

Transcript Highlights:

• $257,400 from the General Fund and $1,442,300 from federal funds for a total reduction of $1,699,700.
• Fund.
• Idaho High Needs Student Fund.
• We're Ready Students Program Fund to the Idaho High Needs Student Fund. We have a motion.
• federal funds.

Summary: The Joint Finance-Appropriations Committee met with a quorum and first considered a trailer appropriation for House Bill 730, which changes how SNAP eligibility is determined. The committee heard that the bill would require $351,000 one-time from the General Fund for system changes in the Division of Welfare. One member argued the change was unnecessary because Idaho already has a low SNAP error rate and uses existing verification systems, but the motion passed in both chambers and received a do-pass recommendation. The committee then took up trailer actions for House Bill 898, moving the State Historic Preservation Office from the Idaho State Historical Society to the new Office of Species, Minerals, and Energy Coordination. Members discussed whether the move was requested by the governor and whether it would improve coordination and permitting efficiency; supporters said it would streamline federal review and the historical society director supported the move. The committee approved reducing the Historical Society budget by 12 FTP and $1,699,700, then approved adding the same staffing and funding to SMEC, and also adopted language exempting SMEC from certain transfer restrictions. Next, the committee considered Senate Bill 128, creating the Idaho High Need Students Fund for extraordinary special education costs. The analyst explained that the recommended one-time $5 million dedicated fund appropriation would also require a $5 million cash transfer, and that increasing special education spending could raise the state’s federal maintenance-of-effort obligation. The committee approved the $5 million appropriation and two transfers: $1 million from the Idaho Career Ready Students Program Fund and $4 million from the driver training account, all with do-pass recommendations. Finally, the committee revisited the Department of Fish and Game budget. After discussion of habitat projects, Good Neighbor Authority work, fisheries inflation, wolf depredation, communications, OITS replacements, and replacement items, a substitute motion that would have funded a larger package failed in the House, and the original motion passed instead. The committee approved a reduced Fish and Game budget package and adopted language directing the $200,000 wolf depredation enhancement specifically to wolf trapping. The meeting ended with brief discussion of the next day’s agenda and timing, including pending items such as rural health transformation and state police-related legislation.

Transcript Highlights:

• So while this is funding that's built into their base budget for the receipt of federal funds or special
• , the expenses from those funds, and what the fund balance was at the end of the biennium.
• , the expenses from those funds, and what the fund balance was at the end of the biennium.
• from the general fund and other funds, FTE counts, ongoing general fund appropriations, and what the
• and major federal funds.

Summary: The Budget Section’s Commerce and Legal Services division met to review the Department of Commerce base budget and current program activities for the 2027-29 biennium. Legislative Council staff first walked through a new “blue sheet” summary explaining what is included in Commerce’s base budget, with emphasis on salaries, operating costs, and especially grant authority funded largely by federal dollars. Members asked about how grant funding is coordinated across agencies, and staff noted that some programs, such as LIHEAP and UAS-related work, involve interagency collaboration and federal budget authority that may not match exact cash received. Commerce Commissioner Chris Schilke then presented on grant administration, the department’s transparency page, and several grant programs, including Destination Development and Automate ND. Members questioned how many entities apply for grants, what criteria are used, whether return on investment is tracked, and how long grant awards take to reach recipients. A lengthy exchange followed over whether Commerce must follow state procurement law or instead administer grants using its own “best practices” process; the commissioner said the department’s approach was based on legal guidance and competitive grantmaking, while some legislators argued the process should more closely reflect legislative intent. The department also highlighted the North Dakota Development Fund, child care loans, and workforce initiatives. Commerce described Development Fund investments, including examples of successful projects and a child care loan program that has supported 43 active businesses serving 3,754 children. Staff also outlined a new non-primary-sector lending framework and said a workforce and housing sub-cabinet are working on more coordinated statewide strategies. Workforce Director Katie Ralston Howell presented a broad workforce-system assessment, a new shared vision, and task forces focused on simplifying entry, improving warm handoffs, and building a public dashboard of shared metrics; members discussed higher education alignment, career pathways, and the need for better handoffs from schools to employers. No formal votes were taken, and the meeting ended with plans to continue these budget discussions in June, including the Attorney General budget.

Transcript Highlights:

• Fund adjustment.
• funds... ...reflects that, yes, we could pull it if needed from general funds, federal funds, authority
• through these federal funds.
• So it's not 100% on the general fund. ...on the general fund.
• the General Fund?

Committee: House Health and Welfare

Transcript Highlights:

• You all funded attendance over three fiscal years, so those programs are funded sustainably at the same
• So when we first started the program, it was funded using... our ESSER funding and federal funding.
• for emergency funding.
• Those schools needed those funds.
• Please make it a high priority to restore at-risk funding through the Hold Harmless Fund.

Transcript Highlights:

• funds, $74.8 million in bond funds, which I know we'll discuss later, and $73.7 million in other funds
• 14 of which are funded by the General Fund.
• and 14 of which are funded by the general fund.
• Special or other funds and 14 of which are funded by the General Fund.
• Many of the positions are also funded through special funds, not general funds.

Transcript Highlights:

• from proposals funded with the General Fund.
• by the General Fund, loaning to the General Fund.
• , and then, in further descending order, federal funds, reimbursements, and bond funds.
• Those funds have depleted, as many funds across the state have depleted.
• Fund and Prop. 68.

Summary: The Senate Budget Subcommittee on Resources, Environmental Protection, and Energy opened its first hearing with remarks from the chair and members emphasizing climate change, resiliency, clean energy, natural resources, and the need to make careful budget choices in a constrained fiscal environment. The Legislative Analyst’s Office presented an overview of the natural resources and environmental protection budget, warning that although current revenues are strong, the state faces significant out-year deficits and should apply a high bar to new ongoing spending, use special funds and fees carefully, and focus on critical health and safety needs. The LAO said the Governor’s Proposition 4 spending plan was generally reasonable and consistent with bond requirements, but urged legislative oversight and reporting, especially where bond funds interact with General Fund proposals. Secretary Wade Crowfoot then described the Natural Resources Agency’s recent accomplishments and priorities, including wildfire resilience, water reliability, coastal protection, outdoor access, biodiversity, tribal partnerships, and streamlining project delivery. He highlighted major investments in climate and resilience, the role of Proposition 4 in continuing those efforts, and the need to modernize water infrastructure, including Delta conveyance and other regional conveyance projects. Members asked about Delta conveyance, invasive species, permitting delays, and the impact of federal staffing cuts; Crowfoot said the administration is pushing projects forward, supports a beneficiary-pays approach for conveyance, and is filling gaps left by federal reductions where necessary. The committee then heard from the Department of Parks and Recreation. Director Armando Quintero reviewed the state park system, outdoor access programs, tribal agreements, wildfire and forest resilience work, and deferred maintenance funded by the climate bond. The LAO recommended rejecting the proposed ongoing General Fund transfer for the California State Parks Library Pass program, saying it did not meet the high bar for new spending, while several members strongly supported the program as a low-cost, high-value access tool. Members also pressed Parks on reservation system problems and no-show vacancies; staff said new rules and enforcement will take effect July 1 and that vacancies are being opened up sooner. The department also presented low-cost accommodation projects, which the LAO supported. Finally, the Department of Fish and Wildlife introduced its new director, Megan Hurdle, who outlined the department’s mission, staffing, service-based budgeting, and Proposition 4 proposals for salmon tagging, hatchery improvements, and public access lands. She emphasized the department’s role in biodiversity conservation, permitting streamlining, law enforcement, and human-wildlife conflict outreach, and said the agency is working to close a service gap identified in its budgeting analysis. No votes were taken during the hearing.

Transcript Highlights:

• Fund.
• Fund.
• , funded through Greenhouse Gas Reduction Fund.
• funding source.
• billion in federal funds.

Transcript Highlights:

• Um, lines 12 through 20 show the overall all-funds total in each position and then a breakdown by fund
• and then funds standards board funding and then funds above<00:09:23.200><c> that</c><00:09:23.519><
• This would just provide grant funding, administrative funding for the grants above.
• ><c> the</c> funding, administrative funding for the funding, administrative funding for the grants<00
• </c> incentive fund. Moving next to line 920. incentive fund. Moving next to line 920.

Transcript Highlights:

• One of those funds is, as I mentioned, 911's Revolving fund.
• funds.
• So typically, their revolving fund is that our 424 fund generally? The loan is well.
• What are CFO and deputy CFO funds, or a certain specific fund?
• Those funds are revolving funds that are restricted funds.

Transcript Highlights:

• This is a smaller fund, a fund we get yearly, about $3 million to $4 million.
• We take legislative funding, federal redistribution, safety funds, special grants, and bridge funding
• We do have, this is our TPF funding, transportation project funds.
• So we're largely funded with non-state road fund.
• Seven of those are funded with federal money, and the other seven are funded with state funds.

Transcript Highlights:

• The other funding here is the Mental Health Reinvestment Fund.
• These are funds from the abandoned fund account transferred to the Mental Health Trust Fund, and we do
• The total funding for FY26 was $1,113,000 from the opioid fund.
• Reinvestment Fund, which is the Cannabis Tax Fund.
• These are funds.

Summary: The Budget Committee heard the Department of Mental Health’s FY 2027 budget presentation, with Director Valerie Hoon outlining a $4.4 billion department budget, including $1.7 billion in general revenue, and describing the department’s roles in substance use, behavioral health, and developmental disabilities services. Early questioning focused on marijuana-related mental health impacts, but the main discussion centered on the department’s new decision items, funding sources, and expected wait lists. The director explained several increases tied to Medicaid growth, mental health youth services, outpatient competency restoration, crisis residential services, developmental disability waivers, and provider tax adjustments, along with offsets such as reduced wraparound funding at the Kansas City Assessment and Triage Center and cuts to some youth and self-directed DD services. A major portion of the hearing focused on competency restoration for people found unfit to stand trial and currently held in county jails. Members pressed the department on the cost, effectiveness, and legal implications of keeping people in jail while awaiting services, noting a reported wait list of roughly 524 to 538 individuals and average holds of about 14 months. The department said it currently has eight outpatient competency restoration beds in the community, is seeking funding for 50 additional outpatient slots, and also operates jail-based restoration for about 40 people at a time. Members repeatedly asked for breakdowns of violent versus nonviolent cases, success rates, cost per person, and the split between state and federal funding, while the department explained that Medicaid can cover only the treatment portion, not residential housing or other non-billable costs. The committee also discussed broader capacity constraints in state hospitals and developmental disability services. Hoon said Fulton, Center for Behavioral Medicine, and FTC North are full, with 183 vacancies across the department, and that the department is working on a new Kansas City hospital that would add 150 beds, though completion is now expected closer to 2029 or 2030. In the developmental disabilities section, the department warned that the governor’s recommendation would create wait lists for in-home waiver services and crisis residential services, and members questioned proposed reductions to self-directed services rates and other provider payments. No votes were taken, and the committee recessed before finishing the presentation.

Transcript Highlights:

• Fund savings.
• the state General Fund spend.
• . ...in federal funds.
• And so those total fund dollars are about $938 million total fund, of that about half is General Fund
• around fund shifting.

Summary: The Assembly Budget Subcommittee on Health held the first of several hearings on the Governor’s May Revision for health care, with opening remarks focused on the state’s projected $12 billion deficit, looming federal Medicaid changes, and the potential impact on Medi-Cal, public health, reproductive health, and safety-net providers. Several members criticized the proposal as balancing the budget on vulnerable Californians, while others defended the need for cost containment and questioned the administration’s assumptions. The chair set ground rules for respectful, focused questioning and outlined three topics: the Medi-Cal proposals, Proposition 35, and Proposition 56. DHCS Director Michelle Baas presented the May Revision’s Medi-Cal package, saying the department’s budget totals $200.6 billion overall, including $45.2 billion General Fund, and that the proposals are intended to address rising caseloads, pharmacy costs, and managed care spending. She described proposed changes for adults with unsatisfactory immigration status, including a freeze on new full-scope enrollment for those 19 and older, $100 monthly premiums beginning in 2027, elimination of adult dental and long-term care coverage, removal of PPS/RAP payments to FQHCs and rural health clinics for that population, and a pharmacy rebate aggregator. Other proposals included eliminating certain OTC drug classes, removing GLP-1 coverage for weight loss, prior authorization and step therapy changes, reinstating the Medi-Cal asset test, eliminating acupuncture as an optional benefit, allowing utilization management for hospice, raising the managed care minimum medical loss ratio to 90%, reducing PACE capitation rates toward the midpoint of the actuarial range, eliminating the skilled nursing facility workforce and quality incentive program, and suspending the SNF backup power requirement. The LAO said the revised Medi-Cal spending estimate is about $2.5 billion higher than the Governor’s Budget in the budget year, and that the increase appears driven more by higher per-enrollee costs than by caseload alone. The LAO said the budget solutions are concentrated in a few areas, are largely ongoing, and should be considered in light of federal uncertainty, but suggested the Legislature could explore alternatives such as more targeted income thresholds for the undocumented expansion and simpler asset-test rules. Department of Finance officials said the proposals are difficult but necessary to address a third consecutive deficit and rising Medi-Cal costs. Members then pressed the administration on the methodology and impacts of the proposals, especially the enrollment freeze, premiums, asset test, hospice controls, PACE reductions, and the elimination of benefits and provider payments. No votes or formal actions were taken at this hearing.

Transcript Highlights:

• into how much was funded.
• That was an existing fund, so you did not create a new fund, but what you did is convert a fund that
• So, really anything funded out of the Public Education Reform Fund requires a general fund appropriation
• amount of funding, and in regular font is the amount of funding per year.
• through the PERF fund.

Transcript Highlights:

• funded Medicaid.
• county funds.
• We have to fund it.
• state General Fund, and county funds.
• And so the mix of funding does... Our full funding of it is fixed.

Summary: The Budget Subcommittee on Health and Human Services heard an overview of the expected California budget and program impacts from H.R. 1, including changes to Medi-Cal and CalFresh eligibility, redeterminations, work requirements, immigration-related coverage rules, retroactive coverage limits, and reductions in federal matching for certain services and provider financing mechanisms. DHCS and CDSS described implementation plans focused on automation, data matching, clearer communications, county training, and outreach, while noting that many federal details are still pending. The Legislative Analyst’s Office also reviewed how H.R. 1 could increase pressure on county indigent care systems, explaining the history of county responsibility under Section 17000, 1991 realignment, and AB 85, and warning that counties may face large increases in uninsured residents seeking care without corresponding funding flexibility. An independent policy expert urged consideration of a more standardized statewide approach to indigent care and raised questions about governance, benefits, and financing. Department witnesses estimated substantial coverage losses and fiscal effects: DHCS projected major Medi-Cal disenrollment tied to work requirements, six-month renewals, narrowed immigrant eligibility, and reduced retroactive coverage, while CDSS estimated large CalFresh benefit losses and a significant increase in administrative workload and payment accuracy pressure. Members questioned how exemptions would work for older adults, people experiencing homelessness, undocumented residents, and cash workers, and asked about the effect on the CalFresh Minimum Nutrition Benefit Pilot and on county administrative funding. Officials said they would use available data and self-attestation where possible, but acknowledged that many cases would require manual screening and that the county workload estimates remain in dispute. They also said the state is still evaluating the impact of H.R. 1 on provider taxes and state-directed payments, which could create additional budget pressure. County representatives from Los Angeles, Santa Clara, Tulare, and San Bernardino described major local consequences if H.R. 1 is implemented as written. They warned of higher uninsured rates, more strain on emergency rooms and public hospitals, increased homelessness and food insecurity, and a likely need to rebuild or expand county indigent care programs that were largely scaled back after the ACA. Counties said they are already freezing hiring, cutting positions, reducing overtime, deferring spending, and launching outreach and coordination efforts with managed care plans and community partners, but argued that these steps are not enough without additional state support. Several counties backed the California County Welfare Directors Association’s request for $373 million in General Fund support for eligibility work and asked for a CalFresh match waiver to soften the new county share of administrative costs; Los Angeles and Santa Clara also emphasized that their local revenue measures would not close the projected gaps. No votes or formal actions were taken in the portion provided.

Transcript Highlights:

• Why would we create a special fund when we already have the harbor special fund?
• We have a harbor special fund.
• We have a harbor special fund.
• We are currently using Harbor Special Fund revenue to fund the improvements that I described.
• with the special fund there?

Bills: SB2816

Committee: House Tourism

Summary: The committees heard House Bill 2195, HD1, which would replace the existing transit accommodations tax on cruise ships with a per-passenger infrastructure fee collected by the Department of Transportation and deposited into a new cruise ship special fund. Testimony included support from Norwegian Cruise Line Holdings and comments from the Tax Foundation of Hawaii warning that the bill should remain narrowly tied to harbor-related uses to avoid potential Tonnage Clause issues. The Department of Transportation testified that cruise-related harbor work includes pier repairs, dredging, terminal upgrades, and shore power, and said a dedicated revenue stream would help prioritize cruise infrastructure needs. The Attorney General’s office said it had submitted written comments but did not address questions about the litigation or constitutional background. Members questioned whether the new special fund was necessary when the existing harbor special fund already finances similar improvements. DOT said the funds overlap and suggested the bill could be amended to use the harbor special fund with a separate cruise subaccount, while still preserving a dedicated revenue stream and separate accounting. DOT also said it currently collects port entry, dockage, and per-head passenger fees from cruise ships and that existing cruise-related expenditures from the harbor special fund have not been challenged. The chair ultimately recommended moving HB 2195 forward as introduced, while continuing discussions about the fund structure and awaiting further clarity from the Attorney General and DOT. In decision-making, the committees voted to pass HB 2195, HD1, as is. They also voted to pass House Bill 916, HD1, relating to the low-income housing tax credit, which would allow certain state low-income housing tax credits to offset state transient accommodations taxes in the same county and make Act 129 of 2016 permanent. Both the Committee on Tourism and the Committee on Economic Development and Technology adopted the chair’s recommendation to pass HB 916, HD1, unamended. The hearing was then adjourned.

Transcript Highlights:

• </c> students can use to utilize the funds students can use to utilize the funds but<00:43:05.599><c>
• </c><00:46:11.440><c> by</c> committed to raising those funds by committed to raising those funds by
• </c> um with the funding um with the funding in<00:46:57.640><c> FY</c><00:46:58.200><c> 2025</c><00:
• </c> organizations um to match the funding organizations um to match the funding that<00:47:11.880><c
• that funding available.

Committee: House Higher Education Finance and Policy

Transcript Highlights:

• How do we fund, you know, doing these events, doing the outreach? How do we fund the investigators?
• And so it means very limited funds.
• And lastly, $1.2 million General Fund in 2026-27, reducing to $259,000 General Fund ongoing, and one
• supported by special funds.
• Although the fund has a sufficient fund balance, we project the fund to be structurally imbalanced in

Summary: The hearing focused on the Missing and Murdered Indigenous People (MMIP) grant program under the Board of State and Community Corrections and related Department of Justice efforts. BSCC reported that it now administers 36 MMIP grants across three cohorts, with awards ranging from $436,000 to $1 million, plus five collaborative grants at $2 million each, totaling $35.4 million awarded to federally recognized tribes. Testimony from tribal leaders and grantees described how the funding supports prevention, family advocacy, domestic violence services, law enforcement coordination, youth programming, culturally grounded healing, and new tribal public safety positions such as investigators, social workers, and drone operators. Speakers repeatedly emphasized that the crisis is longstanding, tied to generational trauma, and that the grant has helped build trust and infrastructure in tribal communities. Several witnesses and committee members urged continued and preferably ongoing funding, noting that demand now exceeds available one-time money. BSCC and tribal representatives described outreach efforts that increased participation from four applicants in cohort one to 20 in cohort two and more applicants than funding in cohort three. Tribes also raised implementation concerns, especially the burden of quarterly narrative reporting, limited staff capacity, and the need for flexible administration. BSCC said it uses steering committees, separate small- and large-project categories, orientations, monitoring visits, and technical assistance to support grantees. Tribal leaders and advocates stressed that the program should remain accessible without requiring a waiver of tribal sovereignty. The second major topic was DOJ’s update on AB 3099, the Tribal Assistance Program, and the tribal police pilot under AB 134. DOJ officials said the Office of Native American Affairs and the Division of Law Enforcement have been conducting outreach, trainings, listening sessions, and coordination with tribal, local, state, and federal partners to address Public Law 280 jurisdictional issues, improve reporting and data, and support Feather Alert and MMIP-related resources. DOJ said the AB 3099 report is in internal review and that the tribal police pilot is moving forward with the Yurok Tribe as a participant, with a July 1, 2026 start date. DOJ and tribal witnesses said the pilot’s main barriers are cost and, for some tribes, the waiver of sovereign immunity. No votes were taken, and the hearing ended with broad support for expanding and sustaining MMIP-related funding and infrastructure.

Transcript Highlights:

• Crew performance funding.
• institution funding formulas and HEF funds.
• Since formula funding is the primary way we are funded, securing additional funding through this formula
• Our key funding priorities are to focus on... ...formula funding increases.
• with federal funding.

Bills: SB1 , SB 1

Committee: Senate Finance

Transcript Highlights:

• A plant, arts education funding.
• Can pull the Proposition 28 funds?
• that are being sunsetted, PTA funds, so private dollars, some schools were using those funds to provide
• , and now you have Prop 28 funding...
• I mean, you have the funds.

Summary: The Assembly Committee on Arts, Entertainment, Sports, and Tourism and the Assembly Education Committee held a joint informational hearing on implementation of Proposition 28, the 2022 voter-approved arts education funding measure. Chairs emphasized the goal of understanding how the roughly $900 million to nearly $1.1 billion annual funding stream is being used, whether it is supplementing rather than supplanting existing arts programs, and what reporting or guidance improvements may be needed. The Legislative Analyst’s Office reviewed the basic structure of Prop 28: funds are distributed 70% by enrollment and 30% by low-income student counts, 80% must generally be spent on staffing, districts may use up to 1% for administration, and annual local reports and audits are required. Members pressed the LAO on waivers, spending timelines, and whether smaller or rural districts face different challenges; the LAO said some waivers have been issued and that districts have three years to spend each allocation, but statewide data remain limited. WestEd, Create California, and the California County Superintendents described early implementation findings and concerns. Their testimony said schools are using funds for arts materials, staffing, expanded instruction, and field trips, and that many respondents saw positive effects on student access and engagement. At the same time, they reported confusion about allowable uses, supplement-versus-supplant rules, and the 80/20 staffing requirement, along with shortages of credentialed arts teachers and uneven access across districts. Create California argued that Prop 28 has generated optimism but also uncertainty, especially for community arts organizations that have seen reduced contracts as districts bring services in-house. County superintendents and researchers called for clearer statutory guidance, stronger technical assistance, better statewide data, and more support for teacher credentialing pathways. District and county officials then described local implementation. Long Beach Unified said it moved quickly to full implementation, using Prop 28 to expand elementary and secondary arts offerings, hire 56 certificated staff and more than 120 classified coaches, and develop a five-year arts strategic plan tied to equity goals. Butte County and other rural representatives said Prop 28 has enabled restored or expanded programs, including arts teachers, theater, and music offerings, but rural districts still struggle to recruit credentialed staff and to make small allocations workable across large distances. The California Music Educators Association echoed those themes, saying members report both new positions and supplies as well as confusion, fear of audit findings, and inconsistent district guidance. Committee members asked about arts definitions, credentialing, rural pooling of funds, and out-of-state teacher credentials; witnesses said media arts are included, multiple credential pathways exist, and recent legislation has eased some out-of-state credential barriers. The hearing ended with public comment beginning after the panel discussions.