Gavin Newsom Wants to Raid California’s ‘Rainy Day’ Fund to Help Fill $38 Billion Deficit

California Gov. Gavin Newsom (D) is proposing to dip into the state’s “rainy day” fund to help fill the hole that is the state’s $38 billion deficit — a stunning shortfall, given a surplus of nearly $100 billion that the Golden State had enjoyed just a year before.

As Breitbart News has noted, California received shocking news at the end of 2022 when a $98 billion surplus, partly fueled by President Joe Biden’s “rescue” plan, collapsed into a $25 billion deficit. Later projections predicted an even larger deficit.

On Wednesday, Newsom presented a budget that estimates a $38 billion deficit — which may only be half of the eventual amount.

As CalMatters.org notes, Newsom proposed spending cuts to some programs, such as state initiatives on climate change, and extra funds to help settle migrants that have arrived in California after crossing over the porous southern U.S. border.

But Newsom is also dipping into the state’s savings to prevent budget cuts in areas such as education. EdSource reported:

Gov. Gavin Newsom would protect schools and community colleges from the brunt of an $11.3 billion projected drop in state revenue for education, under a proposed 2024-25 state budget he released on Wednesday. The budget calls for covering all current levels of funding and existing commitments for new and expanded programs, plus a less than 1% cost-of-living increase for next year.

The three-year decline in revenue, both for schools and the overall $38.7 billion in the state general fund, is $30 billion less than the Legislative Analyst’s Office had projected a month ago, easing the burden of balancing the budget and avoiding the possibility of drastic budget cuts or late payments — at least for community colleges and TK-12.

…

Newsom would protect schools and community colleges by withdrawing about $7 billion from the $10.8 billion TK-14 rainy day fund to cover the current year’s shortfall and meet the minimum obligation in 2024-25. The state would not seek reimbursement for what turned out to be funding above the minimum Proposition 98 statutory obligation for the prior two years.

Newsom’s predecessor, Gov. Jerry Brown (D), created the “rainy day fund,” though it did not solve California’s budget problems.

One driver of deficits is the state’s seemingly endless enthusiasm for providing heath care to illegal aliens. As of this year, the state is providing full benefits under Medi-Cal, the California version of Medicaid, to all residents, regardless of immigration status.

At the time Obamacare was passed, expanding Medicaid, Republican fears that it would benefit illegal aliens were dismissed.

Joel B. Pollak is Senior Editor-at-Large at Breitbart News and the host of Breitbart News Sunday on Sirius XM Patriot on Sunday evenings from 7 p.m. to 10 p.m. ET (4 p.m. to 7 p.m. PT). He is the author of the new biography, Rhoda: ‘Comrade Kadalie, You Are Out of Order’. He is also the author of the recent e-book, Neither Free nor Fair: The 2020 U.S. Presidential Election. He is a winner of the 2018 Robert Novak Journalism Alumni Fellowship. Follow him on Twitter at @joelpollak.