California Gov. Gavin Newsom is proposing to use the state’s “rainy day” fund to address the $38 billion deficit, which is a significant shift from the previous $98 billion surplus.
The deficit is attributed to various factors, including increased spending on programs such as healthcare for illegal immigrants and the impact of the pandemic.
Newsom’s budget includes cuts to certain programs, while also allocating additional funds for settling migrants.
NEW: Gov. Gavin Newsom to declare a budget emergency in California, which is required to withdrawal money from the state's rainy-day fund. 🤡
Bracing for a $37.9B Billion shortfall, he's proposing to use $10.4B from that account, along with another $2.7B from other reserves. pic.twitter.com/wroofoHAVb
— BABS D (@Barbara14130169) January 11, 2024
To prevent budget cuts in education, he plans to withdraw from the state’s savings, aiming to maintain current funding levels and commitments.
This approach has raised concerns about the long-term sustainability of the state’s financial situation.
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