The pressing issue of homelessness took center stage at the California State Assembly’s first budget hearing on Jan. 22.
Governor Gavin Newsom announced his 2020–21 budget Jan. 10, and will be finalized this summer after a series of hearings examining its proposals.
According to Budget Vice Chair Jay Obernolte (R-Big Bear Lake) and legislative analyst Gabriel Petek, California is entering its eleventh year of economic expansion—the longest in state history since World War II.
Newsom’s $222.2 billion budget is balanced and includes $153 in the general fund, said Chief Deputy Director of the Department of Finance Vivek Viswanathan. He projected operating surpluses in the following three years and $21 billion in reserves by year’s end.
While the overall tone of the hearing was positive toward the budget proposals, Assemblymembers noted some shortcomings in plans to address homelessness, and a heated discussion arose around groundwater management.
Homelessness
Assemblywoman Luz M. Rivas (D-Arleta) commended Newsom’s prioritization of the homelessness crisis. “We’re all feeling this crisis statewide,” she said. “I feel a sense of urgency that our state be effective in resolving this crisis. And I think the investments in this budget show that the governor also feels that.”Rivas suggested restructuring and streamlining the entities overseeing the homlessness programs funded in the budget.
Assemblyman Richard Bloom (D-Santa Monica) also said he was happy the budget emphasized help for the homelessness. However, he said, “the $75 million package falls short of what we should be doing.”
Bloom wants to see more rent subsidies. He said that 133 people are being housed per day in Los Angeles County, but 150 are becoming homeless because they can’t afford the rent.
“These are ongoing issues that are not really one-time concerns,” he added. “I want to urge the administration to find an ongoing supply of funds to address these issues that are not going to go away this year, they are not going to go away next year, and we’d like to foresee the time when we reach equilibrium … on this issue.”
James C. Ramos (D-Highland) said crisis residency treatments for mental health issues need to be extended. “We need crisis residency treatment longer term [in order] to help make sure that we’re getting people equipped … to be successful in the homes we’re trying to get them to,” he said.
Committee Chair Philip Y. Ting (D-San Francisco) said the budget plans for addressing homelessness are good, but he noted the realistic limitations they will encounter. “Even in this administration’s tenure, we probably won’t be able to solve the problem just given how long it takes to construct housing, how long it takes to construct permanent supportive housing,” he said.
“Even if everything went perfectly during all of our tenure, we could only hope to really make a dent going into the next administration, frankly.”
Sustainable Groundwater Management Act
The most combative exchange between the Assembly and the Department of Finance centered around the impact of the Sustainable Groundwater Management Act (SGMA) in the San Joaquin Valley.SGMA is a three-bill legislative package that was signed into law by former Governor Jerry Brown in 2014. The motive for the law was to bring groundwater basins into balanced levels of pumping and recharge by about 2040.
Assemblyman Devon J. Mathis (R-Visalia) said some projections have estimated a loss of up to $2 billion.
“Have you guys done any projections on the crop loss due to the implications of SGMA?” Mathis asked, citing a potential 30 percent decline in productivity. “If the San Joaquin Valley becomes a dust bowl because of loss of water due to SGMA [and] environmental regulations…and our row croppers don’t plant, your entire budget could be shot. Is that on your radar?”
Sergio Aguilar, principal program budget analyst for the Department of Finance, said he was “not aware of specific numbers on crop loss.”
Aguilar mentioned several SGMA-related investments in the budgets—including a $395 million bond set aside for SGMA implementation—before Mathis cut him off.
“If we can’t move the water, none of those other programs are really going to be effective,” Mathis countered. “That’s not going to help with row croppers deciding on whether or not they’re going to plant this season or not. … Put yourself in their shoes. If you had to make a decision today, what are you going to do?”
Mathis contended that the row croppers’ decision could skew the entire budget.
“We don’t have any additional proposals other than the SGMA-related investments and water-related investments that we do include in the budget,” Aguilar said.
“That’s what I think everybody’s afraid of,” Mathis said. “We can talk about how we’re going to have surplus and everything else, but if this actually happens, and the valley actually does a 30 percent drop, it’s going to skew the entire thing.”
Mathis responded to Aguilar’s following interjection by concluding, “So we’re going to spend more money to study what we should have already done. That’s fantastic.”
As the meeting approached adjournment, Tom Lackey (R-Palmdale) commented on the rapidly diminishing number of attendees as he addressed the Department of Finance members.
“You guys have done a pretty commendable job of performing what I would feel comfortable characterizing as the Capital’s version of ‘So You Think You Can Dance,’” he said. “Except, in that competition, the contestants dissipate—not the judges. And it seems like we’ve lost several judges.”
In the sparsely populated room, Lackey lamented that allocations for California’s rape crisis centers had dropped from $5 million to $45,000 over the course of one year.
“With the record-breaking budget year that we’ve been talking about and the positive economic outlook … I find it really troubling that the administration has chosen to defund the rape crisis centers,” he said.
Lackey anticipated Viswanathan’s response by noting the ongoing investment of $1.8 million for various related programs. Still, he said, the drop from $5 million to $1.8 million is a “dramatic reduction.”
Two budget subcommittee hearings are scheduled during the next few weeks. The first, on resources and transportation, is scheduled for Jan. 31. The second, on public safety, is scheduled for Feb. 25.
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