Transcript Highlights:

• Because the cost of trying to harden homes, the cost of trying to do all of that, all of the brush clearance
• There is a handful of allocations that we have in a pending allocations plot.
• I think that's the total allocation for the wildfire mitigation grant program in the total allocation
• The cost of going to year-round?
• It's a relatively significant cost.

Keywords: 988, house, all

Transcript Highlights:

• Current law allocates the money collected into the fund as follows: 55% is allocated to the Bureau for
• Current law allocates the money collected into the fund as follows: 55% is allocated to the Bureau for
• This bill would change that allocation.
• Current law allocates the money collected into the fund as follows: 55% is allocated to the Bureau for
• This bill would change that allocation.

Keywords: 994, senate, all

Summary: The Senate Finance Committee met with a quorum present, approved the prior meeting minutes, and then considered a series of House bills and committee substitutes. House Bill 5438, dealing with changes to Step 7 of the school aid formula and allowable uses of certain education allocations, was amended to adopt the Education Committee’s changes and then reported to the full Senate. House Bill 4087 creating the West Virginia-Ireland Education Alliance was also reported, as was House Bill 4191, which expands child care tax credit eligibility for employer-sponsored facilities and changes subsidy payments from attendance-based to enrollment-based reimbursement; senators emphasized its workforce and economic development benefits. House Bill 5074, which reallocates medical cannabis fund balances and future revenues, was amended to increase the Child Protective Commission pilot funding from $3 million to $5 million and remove proposed ibogaine research funding for Marshall and WVU before being reported. House Bill 5353, regulating virtual currency kiosks and money transmission licensure, and House Bill 5527, creating licensure and oversight for wellness reimbursement program administrators, both received strike-and-insert amendments and were reported. House Bill 5687, which phases down the metallurgical coal severance tax and adds a temporary oil and gas tax reduction with county/municipal revenue adjustments, was amended and reported. House Bill 4418, creating an electronic system for municipal business and occupation tax filing and collection with a 1% administrative fee and a participation threshold, was also reported. The committee then took up House Bill 4245, the Revenue Rules Bundle, which bundles 26 legislative rules from the Department of Revenue and related agencies. The bundle included alcohol, banking, insurance, racing, and tax rules, with several sunset extensions and repeals of outdated rules; the committee adopted a strike-and-insert amendment affecting a lottery consumer protection rule and a pre-need cemetery company rule, then reported the bill. House Bill 5168, providing a $12 million lottery-funded stream for emergency medical services, was amended to clarify the uses of the funds, rename one fund, require a 30% county match for mental health treatment spending, and create two additional county-based EMS funds; senators described it as a needed permanent funding source for EMS, and it was reported. Throughout the meeting, members generally supported the measures, with some discussion on technical details, funding allocations, and the impact of the bills on local services and workforce needs. At the end of the meeting, the chair announced that Senate House Bills 4004, 4006, and 4009 would not be taken up that day, and the committee adjourned.

Transcript Highlights:

• <00:25:21.440> that statutory and formula allocations that statutory and formula allocations
• Uh 12.8% is allocated by council policy. Uh 12.8% is allocated by council policy.
• I'll continue to describe how we allocate this and how we came up with these allocations in subsequent
• these allocations in subsequent slides. these allocations in subsequent slides.
• estimate of what that that cost will be. estimate of what that that cost will be.

Bills: HF4693

Keywords: transportation, license plates, validation stickers, replacement fees, government fees, 1183, house

Summary: The Transportation Finance and Policy Committee approved the April 13, 2026 minutes and then heard a presentation from Charles Carlson of Metropolitan Transportation Services on regional transit governance and finance in the Twin Cities area. Carlson reviewed the history of transit governance from private streetcars and buses to public control, including the creation of the Met Council and Metropolitan Transit Commission in 1967, later fragmentation through suburban opt-outs and the Regional Transit Board, and the 1994 consolidation that made Metro Transit part of the Met Council. He also explained the role of the Transportation Advisory Board as a state-created advisory body to the council’s federally designated MPO function, and noted that any major structural change to the Met Council could trigger federal redesignation requirements. The presentation then focused on funding changes over time. Carlson said transit was long supported by fares, property taxes, and federal aid, but that property taxes for operations were prohibited in 2001, federal operating assistance ended, and the state shifted to general fund support and then motor vehicle sales tax revenue. He described the 2006 constitutional dedication of motor vehicle sales tax, the volatility of that revenue during the Great Recession, and the use of one-time state appropriations and later federal COVID relief to cover operating gaps. He said the 2023 legislature created the regional 3/4-cent transportation sales tax to stabilize transit operations, reduced the state’s rail operating obligation, and moved Metro Mobility/Metro Move into a state forecast-based program effective in 2025. Members asked several questions about the structure of suburban “opt-out” providers, including Maple Grove and Plymouth, and how they can contract with Metro Transit or private providers while still retaining control of their allocated funds. Carlson explained that replacement service municipalities receive statutory and formula allocations and choose how to use them. He also described Metro Move as a waiver-based service begun in 2024 that uses human services and Medicaid funds to reduce pressure on the state general fund. Later discussion covered ridership and service shares, with Metro Council providing the vast majority of regional transit service and suburban providers accounting for a small share. No votes or bill actions were taken beyond adoption of the minutes; the chair indicated a bill would be taken up later in the meeting.

Transcript Highlights:

• You have to absorb that cost. You have to absorb that cost.
• each year has been allocated.
• Uh, and that's because government doesn't absorb those costs. It always costs more downstream.
• costs.
• And we've been told that, well, there is a cost burden and they can't absorb that cost burden.

Keywords: 981, all

Transcript Highlights:

• So we've got $25 million allocated.
• , excess costs for OPS, excess costs for all other personnel.
• We've allocated for it before.
• , education enrichment allocation, as well as the ESE guaranteed allocation.
• We are increasing that allocation.

Summary: The Senate took up the 2026-2027 budget and related implementing bills. Appropriations Chair Hooper presented a $115 billion General Appropriations Bill, saying it reduces overall spending from the prior year, preserves reserves, and includes a 3% raise for state employees and 5% raises for state law enforcement, firefighters, correctional officers, and park rangers. Committee chairs then outlined major budget areas, including K-12 education, higher education, health and human services, criminal and civil justice, transportation/tourism/economic development, and environmental/agricultural agencies. Highlights included increased funding for school safety, teacher and scholarship funding, workforce education, Medicaid and kid care, corrections operations, judgeships, affordable housing, hurricane recovery, Everglades and water quality projects, and arts and cultural grants. Members asked detailed questions about several items. Senators discussed the Emergency Management Trust Fund, cultural arts grant allocations, Florida Forever land acquisition versus conservation easements, teacher salary support, charter school capital outlay funding, Bright Futures and EASE funding, New College funding, DOC deficits and inmate health care/food service costs, the ADAP HIV drug program, Medicaid reductions for non-critical access hospitals, and the use of opioid settlement and COVID relief funds. Chairs explained that some apparent reductions reflected shifts below the line or reclassification, that the ADAP appropriation would only cover about six months, and that some vacant positions were being removed as part of a right-sizing effort. Questions also covered lottery staffing, concealed weapons permit processing, elections security funding, and arts grant selection and proviso language. The Senate then substituted House bills for the Senate budget and implementing measures, amended them into the Senate posture, and passed them. HB 5001 (the appropriations bill), HB 503 (implementing bill), HB 5201 (collective bargaining), and HB 5205 (retirement) all passed 36-0 and were sent to conference. Other budget-related bills also passed, including SB 2506 on fuel taxes, SB 2508 on the state agency law enforcement radio system surcharge, SB 2510 on court trust funds, SB 2512 creating 13 circuit and 12 county judgeships, SB 2514 on K-12 education, SB 2516 on higher education, and SB 2518 on health. Most of these passed unanimously, with the Senate requesting the House either pass the Senate versions or include them in budget conference.

Transcript Highlights:

• We're assured no additional cost.
• Uncertainty around the post-2030 allocation levels, allowance supply, and compliance costs makes it significantly
• harder to invest in California. ...allocation levels, allowance supply, and compliance costs makes it
• I'd like you to rethink it in terms of an avoided cost, an avoided compliance cost that has not passed
• That is not cost-effective.

Keywords: 987, senate, all

Summary: The Senate Environmental Quality Committee and Senate Budget and Fiscal Review Subcommittee No. 2 held a joint hearing on CARB’s proposed amendments to the cap-and-invest regulations. Opening remarks from senators emphasized the 2025 reauthorization of the program through AB 1207 and SB 840, and focused on whether CARB’s April revisions faithfully implement legislative intent while balancing climate ambition, affordability, leakage prevention, and the Greenhouse Gas Reduction Fund (GGRF). Several senators raised concerns that the proposal could reduce GGRF revenues, weaken funding for transit, affordable housing, wildfire prevention, drinking water, and other community programs, and shift too much support toward industry. Others stressed the need to protect businesses and consumers from higher costs and to avoid leakage and refinery closures. Senator Cortese’s statement, read into the record, warned that the proposal could jeopardize transportation funding commitments. CARB Chair Lauren Sanchez said the amendments respond to legislative direction and public comment, and described four main changes: increased electric bill credits, a larger manufacturing decarbonization incentive (MDI), additional compliance support for industry, and removal of post-2030 allowance allocations from the current rulemaking. She said the proposal keeps the cap aligned with 2030 and 2045 targets, maintains affordability protections, and is intended to reduce emissions while minimizing leakage and supporting in-state jobs. CARB staff also said the MDI would have guardrails, require applications and reporting, and be tied to emissions-reducing facility upgrades. The Department of Finance explained that GGRF revenue estimates are highly uncertain and are updated periodically based on auction data. The Legislative Analyst’s Office said the amendments are significant and could materially affect environmental ambition, industry support, utility credits, and GGRF revenues. LAO highlighted that the MDI could add allowances above the cap, potentially reducing certainty that 2030 targets will be met, and noted that the proposal appears to shift more allowances to industry and fewer to GGRF than current regulations. LAO also said the proposed GGRF estimate of about $8 billion through the decade could be insufficient to fully fund lower-priority tiers of programs. In questioning, senators pressed CARB on whether the proposal would raise consumer costs, whether free allowances or MDI funds would actually lower prices at the pump, how leakage is measured, and whether the Legislature’s budget assumptions would need to be revised before final action. No votes were taken during the hearing; the discussion was informational and focused on questioning CARB and fiscal staff ahead of the board’s planned May 28 consideration of the amendments.

Transcript Highlights:

• The allocations were provided on an FTE basis, based on the number of FTEs allocated through the model
• The prior law reimbursed those costs in the prior year, so districts who may have a high-cost student
• done allocations in a budget.
• service costs.
• Uh, so, staffing cost, it's uh So, staffing cost, it's determining the number of SROs.

Keywords: 916, all

Transcript Highlights:

• <00:03:47.840> is of I think the total estimated cost is of I think the total estimated cost
• <00:04:12.080> in that will help us reduce those costs in that will help us reduce those costs
• the lost revenue that we can allocate the lost revenue that we can allocate there.<00:06:36.319>
• that are out there that had allocations that are out there that had allocations and<00:07:37.360
• . allocated. allocated.

Keywords: Appropriations - Room 216, 3 February, 2026; 1:30 PM, 925, all

Summary: The committee first heard a proposal to consolidate small or outdated Treasury and agency accounts into pooled investment accounts so idle balances could earn interest and administrative costs could be reduced. Senator DuPree asked whether the change would also eliminate old accounts, and the sponsor said it would close outdated accounts and move funds where they could earn interest. The committee then voted title sufficient, do pass. Senate Bill 2694, described as the biomarker bill, would require mandatory biomarker testing for diagnosis, treatment, management, and monitoring of certain conditions when supported by medical and scientific evidence and nationally recognized clinical guidelines. The bill would apply to health insurance policies written in the state after September 1, 2026, require written reasons for denials, and include reporting requirements back to the Legislature. The sponsor estimated a total cost of about $5.2 million, with roughly $1 million as the state share, and the committee voted title sufficient, do pass. The committee then took up the ARPA bill, which would accelerate the spending deadline from December 31 to September 30 and create three buckets for remaining funds: $100 million for MDOT, about $62 million for lost revenue to help offset insurance costs, and any additional funds to be handled by DFA under the governor’s discretion within ARPA rules. Senators asked about lists of projects, the risk of rushing money out the door, and whether local city and county projects could be repurposed; sponsors said the bill is aimed at keeping funds from being returned to Washington and that projects already in process should be nudged to completion, while unused funds could be clawed back after missed reporting or reimbursement requests. The committee also discussed prior technical problems with some completed projects and said those cases would likely require separate legislative action. The committee voted title sufficient, do pass, committee sub. Finally, the committee considered Senate Bill 2578, which creates a small municipality match fund to help cities under 10,000 population meet the 20% local match needed for discretionary federal and state grants. The chair clarified that the bill establishes the fund but does not create a funding source, and the sponsor confirmed that point. The committee then voted title sufficient, do pass.

Transcript Highlights:

• People are really struggling with the cost of living, compounded by factors like the cost of housing.
• make up the single allocation.
• Starting with the single allocation, as has been noted by other panelists, the single allocation funding
• I think protecting the allocation, as well as increasing the allocation for state funding, is essential
• I will defer on the county cost question to our Colleague, and then on the state cost, I'll note that

Keywords: 988, house, all

Transcript Highlights:

• We'll have an overview of the no-cost allowances allocation to emissions-intensive trade-exposed industries
• So I was asked to give an update on allowance allocation at no cost to emissions-intensive trade-exposed
• I was asked to give an update on allowance allocation at no cost to emissions-intensive trade-exposed
• And the reason for this no-cost allowance allocation policy, the reason that they get many of Reason
• cost because we also allocate no-cost allowances to electric and gas utilities.

Summary: The committee held a work session covering PFAS regulation and impacts, no-cost allowance allocation for emissions-intensive trade-exposed industries (EITEs), and regional resource adequacy and data center load growth. Senator Victoria Hunt was welcomed as a new member. The Department of Ecology reviewed Washington’s Safer Products for Washington PFAS work, including completed restrictions on PFAS in outdoor furniture, carpets, rugs, stain/water-resistant treatments, and newer rules adopted in November restricting PFAS in most apparel, cleaning products, and automotive washes, with reporting requirements for some other products such as cookware and firefighting gear. Ecology also described Cycle 2 PFAS reviews now underway, including artificial turf and paints, and answered questions about compliance, online sales, sell-through periods, and how Washington’s approach differs from broader bans in states like Maine and Minnesota. The Department of Ecology also presented on PFAS in biosolids, describing a 2024 sampling study, limitations in testing methods, and a 2025 statutory amendment requiring additional sampling between 2027 and 2028 and a report to the legislature in 2029. The Department of Health then updated the committee on PFAS in drinking water, reporting that most Group A public water systems have completed sampling, that 317 sources and 188 systems are expected to exceed new contaminant levels, and that treatment costs for public systems are estimated at about $970 million, leaving a large funding gap; members also asked about private wells, health effects, bathing exposure, and home filters. The Board of Health’s new state action levels are being aligned with federal MCLs, and the department said it expects to continue monitoring and notification under state rules. Ecology also briefed the committee on no-cost allowance allocations to EITEs under the Climate Commitment Act, explaining the leakage-mitigation rationale, the current allocation schedule through 2034, and a forthcoming report on policy options for 2035-2050; members asked about industry barriers, competitiveness, and whether facilities might leave the state. Finally, E3 presented a regional resource adequacy study showing rising load, retirements outpacing additions, limited winter reliability value from wind, solar, and batteries, and a projected shortfall beginning in 2026 that could grow to about 9,000 MW by 2030 if planned projects are not built. The presentation emphasized winter cold-weather events, hydro variability, the importance of permitting and transmission, and longer-term options including nuclear, geothermal, hydrogen, carbon capture, and long-duration storage. EPRI then introduced its DC Flex initiative, which is studying how data centers can provide flexible load through workload shifting, cooling optimization, and on-site backup or bridging resources to reduce grid stress and protect ratepayers.

Transcript Highlights:

• We're also allocating $61.2 million to Florida PALM readiness, which will be allocated to our state agencies
• Again, we did increase the base student allocation significantly to cover all operational cost increases
• And those funds are used as startup costs.
• And there are startup costs. There’s also Their needs. And there are startup costs.
• There are also capital costs involved, and those capital costs won’t be there if we permit them, or require

Summary: The House convened on the final day of session, observed a moment of silence for the Minnesota House Speaker Melissa Hortman and her husband, and for Representative Rosenwald’s father, then swore in and seated new members Boyles and Hodgers. The Speaker also outlined the chamber’s end-of-session priorities, including action on the budget and related conforming bills. The House then took up H.J.R. 5019, a constitutional amendment to expand Florida’s budget stabilization fund by raising the cap, requiring annual transfers, and allowing withdrawals for critical state needs. After sponsor explanations and questions about what would qualify as a critical need and how the fund might respond to possible federal funding cuts, the House adopted an amendment that added more flexibility for suspending transfers and withdrawals. The joint resolution then passed on final passage. Members next considered HB 7031, the tax package conference report. The bill repeals the business rent tax and aviation fuel tax, delays the natural gas fuel tax, creates or extends several sales tax exemptions and holidays, and makes changes affecting property taxes, local taxes, pari-mutuel taxes, and revenue distributions. Debate focused heavily on the new permanent exemption for ammunition and hunting-related items, the elimination of recurring housing trust fund and transit-related distributions, and the shift of some funding from recurring to nonrecurring status. Supporters argued the package provides tax relief and preserves annual budget flexibility, while opponents criticized the ammunition exemption and the reductions in recurring housing and transit support. The conference report was adopted and the bill passed. The House then passed HB 5017, which creates a debt reduction program funded by a recurring transfer from general revenue to retire state bonds early, and HB 5015, the state group insurance conforming bill, which directs DMS to develop a formulary management plan and codifies the administrative health insurance assessment. Finally, the chamber began explanation and questions on the General Appropriations Act conference report for fiscal year 2025-26, described as a $115.1 billion budget that is down from the current year and includes more than $12 billion in reserves. Subcommittee chairs summarized major budget areas, including K-12 education, health care, transportation and economic development, agriculture and natural resources, higher education, state administration, justice, and information technology, highlighting funding for school choice, Medicaid, housing, transportation infrastructure, Everglades restoration, workforce programs, cybersecurity, and technology modernization.

Transcript Highlights:

• So we've got $25 million allocated.
• , excess costs for OPS, excess costs for all other personnel.
• We've allocated for it before.
• , education enrichment allocation, as well as the ESE guaranteed allocation.
• We are increasing that allocation.

Summary: The Senate took up the 2026-2027 budget package, beginning with an overview of the $115 billion General Appropriations Bill (SB 2500/HB 500). Appropriations Chair Hooper said the budget is smaller than last year’s, maintains strong reserves, and includes a 3% pay raise for all state employees and 5% raises for state law enforcement, firefighters, correctional officers, and park rangers. Committee chairs then highlighted major spending in their areas, including $34.9 billion for Pre-K-12 education, $11.9 billion for higher education, a $2.1 billion-plus increase in health and human services, $7.9 billion for criminal and civil justice, $16.8 billion for transportation/tourism/economic development, and major environmental and regulatory investments such as Everglades restoration, water quality, and land acquisition. Members asked detailed questions about several items. Topics included the Emergency Management Trust Fund, arts and cultural grants, Florida Forever land acquisition versus conservation easements, teacher salaries and charter school funding, New College funding, ADAP/HIV drug assistance, Medicaid rate reductions for non-critical access hospitals, DOC operational deficits and inmate health/food costs, judicial staffing, and school enrollment supplements. Chairs explained that some reductions reflected shifts in how scholarship and categorical funds are tracked, that the ADAP appropriation would take effect immediately upon enactment but would only cover part of the year, and that hospital reductions were tied to a broader DPP funding increase. Questions also covered lottery staffing, concealed carry licensing workload, and whether vacant positions were being eliminated as part of budget right-sizing. After the budget discussion, the Senate substituted House bills for the Senate budget bills and adopted amendments placing the Senate language onto the House vehicles. The chamber then passed HB 500, HB 503, and HB 5201, and agreed to conference on each. It also passed SB 7028/HB 5205 on retirement, SB 2506 on fuel taxes, SB 2508 on the state agency law enforcement radio system, SB 2510/HB 5401 on court trust funds, SB 2512 on judgeships, SB 2514 on K-12 education, SB 2516 on higher education, and SB 2518 on health, with each bill passing by unanimous or near-unanimous votes and then being sent to conference or requested of the House for concurrence.

Transcript Highlights:

• that they're allowed to allocate.
• allocation.
• allocation.
• So the city of Oakland still is fully eligible for that full allocation. their received allocation.
• full allocation, and then the region that has its allocation is also still in play.

Keywords: 988, house, all

Summary: The committee heard a series of May Revision budget items, beginning with the State Controller’s Office. SCO described requests for Fiscal Book of Record stabilization, payroll system implementation, ACFR reporting support, and unclaimed property outreach funding. Members focused on the Fiscal system’s July go-live, the improved timeliness of the ACFR, and the unclaimed property program’s roughly $15 billion balance and outreach efforts. The Department of Finance and LAO raised no major concerns, and the item was closed after discussion of how the new outreach funding would be used. The committee then considered several revenue proposals. Finance presented a proposal to tax pre-written digital software and SaaS, with estimated General Fund gains of $450 million in 2026-27 and $900 million ongoing; LAO suggested broader digital tax changes and a business-use exemption, while industry groups opposed the measure as a tax on essential digital tools. CDTFA also presented an administrative request tied to the software tax, and later a $10 million budget reduction reflecting lower operational needs. The committee then heard a federal conformity proposal for new children’s tax-deferred accounts, which LAO supported, and a proposal to cut the first-year LLC/LP minimum tax from $800 to $400, which Finance said would aid small business formation but LAO argued was poorly targeted and would reduce revenue. Another major item was a permanent business tax credit limitation beginning in 2027, capping credits at the greater of $5 million per corporation or 50% of pre-credit liability. Finance said it would raise about $850 million in 2026-27 and more in later years, while LAO noted it would mainly affect large firms using the R&D credit and could also touch California Competes and other programs. Public testimony split sharply between business groups opposing the cap and advocates supporting it as a progressive revenue measure. The committee also heard FTB’s CalFile realignment proposal, which would retain a smaller staff to continue improving the free filing system and return most of the prior funding to the General Fund. The hearing concluded with the California Arts Council’s request to reauthorize the Keep Arts in Schools voluntary contribution fund, which brings in about $221,000 to $266,000 annually for arts grants and teacher stipends. Members and advocates supported the item but also urged larger arts funding, including the Performing Arts Equitable Payroll Fund. The Governor’s Office of Business and Economic Development then presented proposals for the California Civic Media Program, CA RISE reappropriation, and a reversion of unused Chips for America facility funds; LAO supported the latter two but was cautious about new civic media spending. Members raised concerns about the civic media program’s scope, including the exclusion of broadcast and the lack of a specific ethnic media set-aside, while GoBiz said funds would begin going out in the fall if approved.

Transcript Highlights:

• Article two is the Clean Water Fund. they allocated that reduction across they allocated that reduction
• those and start allocating the money. those and start allocating the money.
• <01:06:24.240> out money that hasn't been allocated out money that hasn't been allocated out
• trails uh allocation. trails uh allocation.
• allocation.

Keywords: 1187, senate, all

Transcript Highlights:

• Also below that is what we call soft cost, or owner project cost, which pays for all the design, project
• to be allocated.
• <00:09:29.120> and of all of the construction costs and of all of the construction costs and
• cost which uh pays cost or owner project cost which uh pays for<00:09:38.680> all<00:09:38.920
• <00:09:53.680> to and what is currently been allocated to and what is currently been allocated

Keywords: 919, house, all

Transcript Highlights:

• Proposition 4 allocates $15 million.
• Resiliency sub-allocation. Yeah, sure.
• We have allocated nearly $900 million.
• At the same time, I noticed this morning that this allocation of $668 million is the largest single allocation
• We are paying that cost right now.

Keywords: 988, house, all

Transcript Highlights:

• development set aside or uh allocation development set aside or uh allocation that's<00:12:52.880
• just to help people understand the costs just to help people understand the costs involved<01:04
• Most of the cost of this project... for the cost of $1.25 for the cost of $1.25 billion<01:04:38.599>
• <01:05:24.400> had 2022 it did not open but the cost had 2022 it did not open but the cost
• when we talk about the rise and cost when we talk about the rise and cost delay<01:16:43.159>

Keywords: 1183, house

Transcript Highlights:

• So we've allocated $15 million for that.
• Okay, so it will cost more. It's not that it's costing more.
• Is it cost neutral? It’s cost neutral. Okay.
• It costs neutral? It's cost neutral. Okay.
• 50% of those costs.

Keywords: 987, senate, all

Summary: The hearing opened with Department of Finance and Legislative Analyst’s Office remarks on the May Revision, which both described efforts to reduce large out-year operating deficits through a mix of revenue increases, spending reductions, and reserve use. Finance said the May Revision more than halves projected deficits in later years, while LAO stressed that revenues are at unprecedented levels yet the state still faces a significant structural deficit and is drawing down reserves; LAO urged maintaining at least the administration’s level of budget solutions and adding to reserves rather than new ongoing commitments. The chair echoed concern about cuts to vulnerable populations and noted the tension between service reductions and requests for additional administrative positions. The committee then heard a series of California Health and Human Services and HCAI proposals, including additional legal support for CalHHS to respond to federal HR1 changes; a net-zero transfer of positions for a centralized eligibility/data-sharing platform; 988 crisis line implementation funding and continued work with the Trevor Project to train crisis centers to better serve LGBTQ youth; EMS data system maintenance funding; HCAI implementation of AB 1312 hospital charity care screening; SB 660 data exchange framework funding; CalRx biosimilar insulin reappropriation; and a diaper access initiative that would provide free diapers to newborns in participating hospitals and support a future direct-to-consumer purchasing option. Members questioned the diaper program’s universal design, the use of a Public Contract Code exemption, and the selection of Baby2Baby, with the chair expressing concern about optics and the lack of an income threshold. The committee also discussed distressed hospital funding, with HCAI requesting up to $50 million for another round of grants to hospitals in immediate financial distress. HCAI said it receives annual and quarterly financial reports but the data lag limits real-time monitoring, and the LAO recommended stronger program parameters and turnaround plans. Members argued the repeated need for distressed hospital aid reflects a structural problem, not a short-term gap, and raised broader concerns about hospital reimbursement and patient flow. Other items included reverting $19.6 million in unused opioid settlement funds from HCAI to DHCS for General Fund offset, and a Rural Health Transformation Program request to increase HCAI spending authority to cover the full federal award. Later, DMHC presented funding requests to implement PBM licensing and financial review requirements under AB 116, modernize the managed care complaint system, and build an electronic claims settlement data system under AB 3275. The final major discussion focused on the Behavioral Health Services Oversight and Accountability Commission, which opposed the May Revision’s proposed reduction of its Innovation Partnership Fund from $20 million to $10 million and a $6.7 million cut to community advocacy grants. The Commission argued these programs are core to Proposition 1’s goals of statewide innovation and community accountability, while Finance said the proposal is consistent with Proposition 1’s maximum funding levels and reflects a broader effort to prioritize direct services and use unspent prior-year funds; members pressed for more information and questioned whether the cuts would undermine the new behavioral health framework.

Transcript Highlights:

• Is this allocation paying back that loan? This allocation is not paying back that loan.
• This is for program costs and, again, cash flow needs.
• So we are augmenting that from a $2.8 million allocation to $19.8 million, a $17 million additional allocation
• I'd like to know more about this allocation, the decision to allocate more, and who this is going to
• And is it true... ...costs are rising nationally.

Summary: The Assembly Budget Committee held an informational hearing on SB 100/AB 100, the early action budget bills, with a focus on Medi-Cal funding, wildfire recovery, and several smaller budget adjustments. The Department of Finance explained that the bill would add $2.8 billion General Fund and $8.3 billion federal funds for Medi-Cal, along with other items including wildfire-related local assistance for Los Angeles County, property tax backfills for fire-damaged local agencies, Cal OES wildfire monitoring authority, nonprofit security grants, the Property Tax Postponement Fund, FARMER and Clean Cars for All funding, foster family home insurance claims, Proposition 98 technical assistance for LA wildfire-impacted schools, teacher credentialing authority, and Proposition 4 climate bond appropriations for wildfire and forest resilience projects. Much of the member discussion centered on rising Medi-Cal costs, the recent $3.4 billion cash-flow loan, and whether the new appropriation would cover payments through June. Finance said the new funds were for program costs and cash flow, not repayment of the loan, and that no additional loan authority remained. Members also debated the causes of higher Medi-Cal spending, including expanded eligibility, higher enrollment, pharmacy costs, and federal policy changes. The LAO noted that forecasting errors are not unusual but that current revisions are somewhat higher than typical, though not unprecedented. Several members emphasized that Medi-Cal supports access to care and hospital stability, while others raised concerns about sustainability and future federal cuts. Public commenters largely supported the bill, especially the Medi-Cal funding and wildfire-related provisions. Health and labor advocates argued that the program is functioning as intended by covering more low-income Californians and preventing uncompensated care. Representatives of special districts and the Altadena Library District supported the property tax backfill provisions tied to the Eaton fire. The hearing ended without a vote, with the chair noting that the committee would adjourn for floor session and that the Assembly would vote on one of the early action bills later that morning.

Transcript Highlights:

• So that’s why the cost allocation becomes very important.
• So that’s why the cost allocation becomes very important.
• And so again, if you have a cost allocation...” “...budget.
• So what happens is, again,... ...those cost arrangements are done through the cost allocation plan I
• mentioned, the statewide cost allocation plan.

Summary: The committee met to hear consultants Mason Bishop and Cameron Christie discuss Arkansas’s “one door/no wrong door” workforce and social services modernization effort. Bishop argued that the current system is fragmented across multiple agencies, offices, and portals, making it hard for job seekers and employers to access services efficiently. He said the goal is to create a more integrated system that promotes upward mobility, longer labor force attachment, better employer access to talent, greater efficiency, and faster adaptation to changes such as AI and other economic disruptions. Bishop repeatedly pointed to Utah as a model, describing how that state combined workforce and public assistance functions into a single agency, used statewide cost allocation to blend funding streams, and improved customer service and outcomes after reform. He said Arkansas should consider integrating governance, service delivery, and financing, including possible waivers, a statewide cost allocation plan, and a benefits-cliff pilot. He also said Arkansas’s current local workforce board structure creates duplication and weak coordination, and that Launch is a useful tool but not a full service-delivery system. Committee members asked how the proposal would work in practice, including whether TANF could be used to cross-train DHS workers, how federal waivers might be obtained, how local boards would be affected, and how disabled clients would be handled. Bishop said TANF should be treated as part of a workforce strategy, that federal pilot authority for workforce reform nearly passed but did not, and that waivers are now the practical path. He also said Arkansas could either merge functions more fully or at minimum co-locate workforce staff in DHS offices statewide. No votes were taken; the meeting ended with plans to continue the discussion in August, including a focus on case management and whether the state is managing programs or people.