Enacted Budget – Fiscal Year 2024
Governor Gavin Newsom signed the state’s fiscal 2024 budget into law on June 27. The budget provides for total state expenditures (excluding federal funds) of $310.8 billion for fiscal 2024. This includes $225.9 billion in general fund spending, a 3.7 percent decline from fiscal 2023. The budget is based on a general fund revenue forecast of $208.7 billion for fiscal 2024, representing a 1.5 percent increase from fiscal 2023. The enacted budget projects a $37.8 billion balance (16.7 percent of general fund expenditures) in the state’s rainy day fund accounts (including the Budget Stabilization Fund, Public School System Stabilization Account, Special Fund for Economic Uncertainties, and Safety Net Reserve) in addition to $5.3 billion in the Reserve for Liquidation of Encumbrances, for a total balance of $43.1 billion. The budget includes a package of strategies to close a $31.7 billion budget gap without tapping reserves; these strategies include spending reductions, delayed spending, shifts of spending from general fund to other funds, revenue increases, and internal borrowing. Most of the additional revenue comes from the new Managed Care Organization (MCO) Provider Tax, effective April 1, 2023 through December 31, 2026. For K-12 education, the budget provides for the largest cost-of-living adjustment in the history of the Local Control Funding Formula (LCFF), which when combined with declining enrollment results in a $3.4 billion annual increase in discretionary resources for school districts. The budget also provides $300 million to establish an Equity Multiplier add-on to the LCFF to close opportunity gaps of historically underserved students, while continuing to invest in other K-12 priorities as well. The budget also provides base spending increases for higher education to maintain compacts with both state university systems. The enacted spending plan invests funds in public transit and efforts to address homelessness, while also establishing new accountability requirements for local governments and transit agencies in these areas. Additionally, the budget includes $52 billion in multi-year climate investments and commits more than $800 million across multiple programs to improve public safety.