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Yes: 154 • No: 46
CaliforniaAB 1022025-2026 Regular SessionHouseWALLET
Budget Act of 2025.
Sponsored By: Jesse Gabriel (Democratic)
Signed by Governor
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Bill Overview
Analyzed Economic Effects
203 provisions identified: 161 benefits, 14 costs, 28 mixed.
More civil legal aid funding
The state sends $35,392,000 to the Legal Services Trust Fund for civil legal aid, with up to 10% for joint court projects and up to 2.5% for admin if ordered. It also provides $5,000,000 each year for grants through the Access to Justice Commission, with preference for rural and underserved immigrant communities. Grantees can spend these funds through June 30, 2027. Starting in 2025–26, CARE Act grants run in three‑year cycles with limits on funding cuts (25% for the first cycle; up to 50% in later cycles). Schedule (7) funds follow set splits: up to 5% admin transfer, then 10% to joint court/legal projects and 90% to statutory distribution.
Keep CalWORKs and benefits on time
The state can borrow up to $500 million to cover CalWORKs and similar payments when federal or local money is late. The loan is repaid when those funds arrive. For 2025–26, the Department of Finance can approve extra spending if caseloads, payment timing, rules, or court orders drive costs up. If costs exceed the budget, the department reports to lawmakers and the item’s appropriation increases to keep checks flowing.
More help paying health premiums
The law gives $192 million to the state subsidy program at the health insurance marketplace. Up to $2 million of that helps cover health care for striking workers, and Finance may add up to $3 million more with 10 days’ notice if reserve funds and revenue allow. It also makes up to $190 million available to lower costs for coverage year 2026, which can reduce premiums for eligible enrollees.
Better pay and staffing in courts
Courts can pay contractual, certified, and registered interpreters for work in and tied to court proceedings. The Judicial Council sets payment rates and rules, not above federal certified interpreter rates, and must report yearly. Another $30 million helps courts hire and keep more official court reporters for family and civil cases, including salaries, conversions to full‑time, and bonuses. Funds cannot replace existing spending on court reporters; unused money returns to the General Fund.
Big boost for UC student needs and programs
The state provides $4.78 billion to the University of California with targeted support for students. It funds food security ($15.8 million), student mental health ($21.3 million), rapid rehousing ($3.7 million), summer‑term aid ($4 million), and ongoing supports for foster youth ($6 million), Underground Scholars ($4 million), and undocumented students ($5 million). It also funds UC medical education ($12.9 million), a firearm‑violence research center ($4 million), and student academic preparation ($22.5 million ongoing). Separate funds support UC medical school projects ($21 million), labor research ($13 million ongoing), vectorborne disease surveillance ($1 million ongoing), and legal services for undocumented and immigrant students, faculty, and staff ($1.823 million). UC must meet reporting deadlines on several of these programs.
Cal Grant amounts and extra help
The law sets Cal Grant maximums: $4,000 for new students at non‑WASC for‑profit schools; $8,056 for new students at WASC‑accredited for‑profit schools; $9,358 at private nonprofits; $1,648 for the Cal Grant B access award; $2,462 for Cal Grant C tuition/fees; $1,094 for Cal Grant C books at community colleges or $547 elsewhere. UC and CSU awards match 2025–26 systemwide tuition and fees. Students with dependent children get up to $6,000 more for Cal Grant A/B or up to $4,000 more for Cal Grant C at community colleges. Former or current foster youth get the same added amounts.
Equity programs for community college students
The law funds major student equity programs. It provides $189.3 million for EOPS and $34.6 million for CARE, with at least $5.0 million for textbook help. It gives $13.3 million for Puente (requires a $200,000 private match), $39.4 million for MESA (at least $280,000 per college), at least $1.8 million for Middle College, and at least $9.2 million for Umoja. Up to $54.1 million is prioritized for foster youth services, and $10.8 million supports Veteran Resource Centers if colleges meet standards. It adds $1.1 million to expand A2MEND charters, $35 million for Rising Scholars (multi‑year grants and technical help), and $10 million in one‑time grants for LGBTQ+ student supports (up to $900,000 per district, spendable over five years).
Faster training and credits at community colleges
The state invests $290.4 million in the Strong Workforce Program and $22.9 million for priority sector projects. Up to 10% can fund state technical help, and training dollars must have at least a 1:1 private match. It provides $20 million to expand online and systemwide‑transferable courses and to support a common learning system. It funds $5 million each year for credit for prior learning so students can finish sooner and pay less. It adds $8.5 million for nursing program support and $4.9 million for services that reduce nursing student dropouts.
Middle Class Scholarship covers 35%
For 2025–26, your Middle Class Scholarship covers 35% of your remaining financial need. The Legislature plans about $918,038,000 in 2026–27 to pay 2025–26 costs. Finance will use a General Fund loan for cashflow, with interest waived.
More funding for school-run preschool
The law provides $1.866 billion for the State Preschool Program run by local school agencies. It funds quality ratings, family literacy, family fee cuts, more slots for three‑year‑olds, higher cost‑of‑care rates, and Prospective Pay tools. If California wins a federal Preschool Development Grant, the Department of Finance can add spending authority after a 30‑day notice to budget leaders.
More special education funding and services
The law provides $1.482 billion in federal IDEA funds to local education agencies. $69 million is reserved for educationally related mental health services, paid at an equal rate per pupil. It also funds ADR work, parent and in‑service training, inclusion grants, technical help, accessible materials, and transportation. Some funds are one‑time and are available only until June 30, 2028.
More state grants and teacher aid
The Student Aid Commission receives funding for Cal Grants, loan assumption programs, Cash for College, and Cal‑SOAP. $2.4 million is ongoing for Inland Empire Cal‑SOAP projects. The law sets aside $7.5 million for Dream Act Service Incentive Grants. It adds $50 million to the Golden State Teacher Grant Program. It also reuses $6.112 million for foster youth college savings, available until January 1, 2029.
2025 Earned Income Tax Credit set at 85%
For tax year 2025, the state Earned Income Tax Credit uses an 85% adjustment factor. The state provides $36.149 million to process returns, audit, and update systems to run the credit.
Big boost for transportation projects
The budget adds about $1.94 billion in 2025–26 for DOT positions and overtime. It also provides $338 million for outside consultants and professional services. The plan cites an average labor rate of $287,000 per full‑time role. This funding supports project delivery, not direct payments to households.
Up to $2.5B for disaster recovery
The Director of Finance can add funds in 2025–26 to help recovery from the Eaton and Palisades fires. The law also covers some Los Angeles County community college recovery and public safety costs during demonstrations. All additions fit under a $2.5 billion cap and must be made by June 30, 2026. Finance must notify the Joint Legislative Budget Committee, and normally wait 3 days before acting.
Funds to run highway projects
The law sets aside $456,461,000 for DOT capital outlay support overhead and corporate resources. DOT can adjust the amount with Finance’s concurrence and must report overhead spending each quarter. This keeps statewide highway project delivery running.
More highway repairs and funding flex
At least $234 million must go to major highway pavement contracts, without replacing other planned funds. Transportation may swap in federal funds for State Highway Account dollars and must notify fiscal leaders within 30 days. The High‑Speed Rail Authority is exempt from full cost recovery for certain services but still pays functional overhead.
State loans for transit and wildfire recovery
The Director of Finance can offer General Fund loans up to $1 billion for eligible Los Angeles County entities and up to $750 million for entities outside LA County. The loans support wildfire recovery in LA County and help keep transit services operating. Loan terms, including full repayment and a guaranteed repayment mechanism, are set in a 2025 trailer bill. Some parts take effect only if 2025 legislation authorizes a regional measure to support transit operators.
Water funds extended through 2027
The state makes up to $165 million from a 2022 budget schedule available again. These funds can be spent or committed until June 30, 2027.
Wildfire program funds extended
CAL FIRE can use up to $51.804 million from a prior budget item until June 30, 2027. It can also use up to $50.9 million from another prior item until June 30, 2026. This extends time to obligate more than $100 million for wildfire and related programs.
Bridge loans keep disability services running
The state can loan up to $1.27 billion from the General Fund to Developmental Services. This covers cash gaps when reimbursements are late. The loans are repaid once reimbursements arrive.
2025-26 school funding levels set
Proposition 98 funding is $80.737 billion for 2025–26. School districts get $72.165 billion; community colleges get $7.633 billion; adult education and K–12 workforce get $847 million; other K–12 agencies get $92 million. There is no deposit to the school stabilization account this year. Also, during 2025–26 the Controller moves community college apportionments in Item 6870‑101‑0001 into Section B of the State School Fund.
Higher ed base funding restored later
The law restores deferred 2025–26 higher education compact funding on a schedule. It provides $100.902 million ongoing in 2026–27. It plans a one-time $252.255 million back payment in 2027–28. It provides $151.353 million ongoing in 2028–29.
UC agriculture and school meals research
The UC Division of Agriculture and Natural Resources receives $121.079 million. The UC Nutrition Policy Institute also gets $1.3 million one time for School Meals for All research. These funds add to, not replace, other support for the division.
Budget timing shifts and definitions
The law sets the 2025–26 General Fund revenue estimate at $244.822 billion for constitutional budget uses. It moves $143.839 million of one-time General Fund from 2025–26 to 2026–27. It also includes a clause that repeals this Budget Act if neither AB 131 nor SB 131 is signed by June 30, 2025.
Rainy‑day fund deposit paused for 2025–26
The law suspends a $1.559 billion transfer to the state’s Budget Stabilization Account for 2025–26. This keeps that money out of reserves for the year and leaves more in the General Fund.
More money moved to General Fund
Starting July 1, 2025, $7.1 billion moves from the Budget Stabilization Account to the General Fund. The Director of Finance may borrow up to $1.5 billion from special and other borrowable funds in 2025–26, using only idle money, with repayment later when the source fund needs it. The Controller can also transfer $40 million from the HOPE for Children Trust to the General Fund when ordered.
More holistic help in public defense
The law provides $15,000,000 to improve public defense for low‑income people. Grants can pay for social workers, housing specialists, training, pilots, data, and independent evaluation. Up to 5% may cover state administration. A report is due March 1, 2026, and a final report is due March 1, 2029. Money is available until June 30, 2028 and must add to, not replace, existing funds.
More help for people in court
The law sets aside $15,750,000 for CARE Act legal services, available until January 1, 2027. It provides $25,300,000 to help self‑represented litigants; any unused money returns to the General Fund. Up to $556,000 can be moved to run the dependency counsel program’s administrative work when approved by the Administrative Director of the Courts.
Keeps SNAP and cash aid running
Finance can move funds to pay CalWORKs administrative hearing costs, so appeals keep working. If a disaster is declared and a county asks, the state can take over eligibility and grant decisions and shift funds to do that. If a county does not pay the EBT contractor, the state can pay so transactions continue and then collect from the county. The state may add up to $250,000 to comply with federal ABAWD time‑limit rules. Finance can also approve extra California Food Assistance spending when federal changes raise costs; if costs exceed the item, Finance reports it and the appropriation increases.
More support for TGI wellness
The law gives $16.8 million and $3.2 million to TGI wellness and equity programs. The Controller also transfers $12.3 million and $2.7 million into the TGI Wellness and Equity Fund. Of these funds, $12.3 million and $2.7 million are available for grants to community groups through June 30, 2029.
Protect TANF funding for families
State funds counted toward the TANF maintenance‑of‑effort must be spent only in ways that qualify under federal rules. This protects federal TANF dollars and helps keep benefits for low‑income families.
Help to harden homes against wildfire
The law reserves $3,000,000 for a home‑hardening program, which starts only if later enabling legislation passes. It also gives $9,500,000 to the California Fire Safe Council for county coordinators who focus on home hardening, defensible space, planning, and education.
More affordable housing on state land
Finance can raise spending authority by up to $4,500,000 in 2025–26 to keep redeveloping surplus state properties as affordable housing. The increase can cover up to three years of operating costs.
$50 million plan to grow Sonoma State
The law gives CSU $50 million. Sonoma State gets $45 million for a turnaround plan, including $16 million over two years to expand a BSN program by spring 2027, $5 million to grow the Career Center by spring 2027, $5 million to launch data science by fall 2027, $2 million for environmental science, $8 million for athletics over three years, and $9 million for enrollment and programs over three years. Another $5 million helps low‑enrollment CSU campuses with outreach.
Apprenticeship support set at $10.32/hour
The law sets apprenticeship reimbursement at $10.32 per hour. It also sets aside $30 million for the California Apprenticeship Initiative. Regular apprenticeship funds can be used through June 30, 2028. Initiative funds can be used through June 30, 2031.
Backstop for injured workers’ benefits
If the Subsequent Injuries or Uninsured Employers programs run short, authorized workers’ comp funds pay benefits. Those payments are repaid to the workers’ comp administration fund when revenues arrive. This keeps injured workers’ checks coming.
Better pay and health for part-time faculty
Districts get funds to raise part‑time faculty pay, allocated by prior‑year FTES with adjustments for small districts. Exact raises are set through local collective bargaining. Districts also receive incentive funding to expand employer health insurance for part‑time instructors.
Community college funding stability and support
Schedule (1) payments offset certain mandated cost claims for districts. The Chancellor can use unused growth funds to cover shortfalls in the funding formula. Up to $500,000 repays colleges for federal aid returns when fee‑waiver students fully withdraw before the census date, and up to $100,000 funds a maintenance allowance. Student Equity and Achievement funds are apportioned under existing rules. The law also provides $685,000 for the statewide course numbering system, $7.5 million for technical assistance and $20 million for statewide workshops (with a $1 local match per $2 when districts request help), and up to $3 million each year for textbooks or digital content for incarcerated or detained students by September 1.
CSU graduation help and transparency
CSU gets $35 million ongoing for Graduation Initiative 2025 to close equity gaps for low‑income and underrepresented students. CSU must report by March 1, 2026 and yearly on how mental health and basic needs funds are used, including campus budgets, CalFresh participation, students served, service metrics, and outcomes.
Hire more full-time college faculty
Community colleges get $50 million to hire full‑time faculty systemwide and $100 million for districts to move toward 75% full‑time faculty. The Chancellor’s Office must consult fiscal and legislative staff before distributing funds. Another $10 million supports equal employment opportunity plans and tools to diversify faculty, staff, and administrators.
Housing, childcare, and coaches at community colleges
The law funds $20.6 million for rental help and wraparound services for homeless and housing‑insecure students. It provides $75.8 million for basic needs, including $32.5 million for student mental health and $43.3 million for basic needs centers and coordinators. It adds $11.5 million for childcare, at least $6.1 million for student work‑study wage reimbursements, and $769,000 for job placement. It also gives $5 million for student success coach grants. Annual reports on outcomes are required.
Immigration help and Dreamer services on campus
Community colleges can contract with the state social services department so qualified groups provide immigration legal services on campus. The Chancellor’s Office also provides $11.6 million for Dreamer Resource Liaisons and student support, including career pathways and economic mobility help.
Keep Cal Grants and aid on time
Finance can lend up to $125 million from the General Fund to the Student Aid Commission when federal TANF reimbursements are late. The loan must be repaid within 90 days and interest may be waived under state law; it is only allowed after social services confirms no TANF resources are available. Finance may also add money for Cal Grant awards from the state’s special fund after a 30‑day notice to budget leaders.
More before- and after-school programs
The state provides $4.525 billion to expand before‑school, after‑school, intersession, and non‑school‑day programs under Education Code 46120. This starts in the budget year covered by this act. The law also gives a one‑time $5 million grant to Save the Children for after‑school programs in rural school districts.
More College Promise aid and outreach
The state funds the California College Promise with $91.2 million. It also pays for $0.91 per unit reimbursements (at least $14.0 million) and a 2% reimbursement (at least $14.19 million). The law funds $5.3 million for statewide outreach, including $2.5 million for bilingual outreach. It allows up to $45.2 million for direct help to applicants (at least $50,000 per campus) and up to $5 million to maintain financial aid technology.
More CSU help for student needs
CSU gets $15.8 million to expand student mental health services and $26.3 million for the Basic Needs Initiative. $12 million supports foster youth programs. $1 million supplements campus services for students with disabilities and is based on disability counts. Project Rebound gets $11.3 million and must report by April 1, 2026 and every year after. CSU provides $6 million for summer‑term aid to California residents, including AB 540 students. The law provides $8 million ongoing for the AANHPI Student Achievement Program and $1 million ongoing for the Dymally Institute.
More enforcement for worker rights
The law provides $14 million to support the Retaliation Complaint Investigation Unit, with lawmakers signaling ongoing support. It also provides $8.5 million for the Garment Worker Wage Claim Pilot Program, with up to 5% for administration.
More firefighter jobs made permanent
The budget provides $39 million to start converting some Firefighter I hand‑crew jobs to permanent positions. Lawmakers state intent to add $78 million in 2026–27 and ongoing. Another $39 million is set aside to begin converting engine, helitack, and air attack roles, which takes effect only with future legislation and funding.
More funding for teacher credentialing work
The law provides $7.352 million to the Commission on Teacher Credentialing. It funds staff and outreach for grants, the Roadmap to Educational Careers, PK–12 workforce data, and early childhood preparation and licensure. It also backfills $3.4 million lost from declining credential fees and supports professional fitness and recruitment work.
More funding to keep community colleges open
The law increases core funding for community colleges. It adds a 2.30% cost‑of‑living bump and money to grow enrollment by 0.57% for 2025–26. It also restores and reuses past‑year funds to keep payments on time, including repaying deferred apportionments. This helps colleges keep classes and services available.
More support for disabled college students
The law funds at least $3.945 million to fix accessibility issues, at least $943,000 for High Tech Centers, and at least $9.6 million for sign language and real‑time captioning. Districts must provide $1 in local or other funds for every $4 they receive for sign language services.
Set rates for K‑12 mandate grants
The state apportions $272.954 million for 2025–26 using fixed per‑ADA rates. Districts and county offices get $39.09 per K–8 ADA and $76.48 per 9–12 ADA; county offices also get $1.31 per unit of countywide ADA. Charter schools get $20.52 per K–8 ADA and $58.21 per 9–12 ADA. If funds are short, the rates drop proportionally for all.
State employee raises and benefits funded
The law provides $105.146 million from the General Fund, $70.56 million from special funds, and $37.882 million from nongovernmental cost funds for state employee raises and related benefits. The Director of Finance allocates funds by budget order under approved labor agreements or pay schedules. Pending agreements that need a new law must be approved separately.
Targeted funds for schools and libraries
The law reuses prior unspent school funds, including $19.331 million and $131.865 million for specified programs and $2 million one‑time for the California School for the Deaf, Fremont. It funds education department work like special education dispute resolution and charter oversight. The State Library continues $500,000 yearly and adds $800,000 one‑time for the Braille Institute. The law also gives $3.6 million to the Altadena Library District.
Workforce grants extended to 2028
Workforce funds remain usable through June 30, 2028 for several programs. This includes $38,142,000 for statewide reentry grants, $14,088,000 for High Road Training Partnerships, $12,000,000 for well‑capping pilots, $6,062,000 for Prison to Employment, and $2,723,000 for Breaking Barriers.
Youth Corps jobs prioritize AB 540 and DACA youth
The law provides $68.1 million for the California Volunteers Youth Corps. Programs must prioritize outreach to AB 540 students and immigrant youth with federal work authorization, including DACA. Programs cannot ask for unnecessary immigration or citizenship information to decide eligibility.
More state help for small businesses
The law gives $23 million to expand small‑business technical help, available through June 30, 2027. It sets aside $3 million to draw down federal SBDC funds. Up to $650,000 can be added to match a federal trade grant after a 30‑day notice. It provides $17 million for regional social enterprises (with up to 3% for admin) through June 30, 2028. GO‑Biz also gets $7.5 million for the SEED Initiative and reuses several prior‑year funds through June 30, 2026.
$100M for walking and biking projects
$100 million is available for the Active Transportation Program. The state can allocate funds until June 30, 2027. Money can be spent and liquidated through June 30, 2030.
$144M to cities and counties
The law sets aside $144,070,000 for local governments. It reimburses Alpine ($117,000), Mono ($2,381,000), and San Mateo ($76,572,000) for 2023–24 shortfalls tied to tax adjustments. The Controller pays after receiving an allocation schedule from Finance.
Faster funding for wildfire response
Finance can redirect CAL FIRE funds to pay for emergency fire suppression, detection, and revegetation. Item 3540‑006‑0001 money can be used for these costs, with quarterly reports to Finance and the Legislature. Finance can allow extra spending after reports, usually not sooner than 10 days. CAL FIRE can also get a short‑term General Fund loan up to 45% of certain reimbursements, due by November 15 of the next fiscal year. Interest on the loan can be waived and the budget committee is notified within 10 days.
Finance can hire outside help faster
The Department of Finance can hire private firms or individuals for Chapter 496 work and for legal, audit, and advisory help on listed Health and Safety Code matters without following standard contracting rules or DGS review. Finance can also hire consultants, up to $20 million total, to improve state processes. DOF must notify the budget committee within 10 days of any such contract and report each year on proposals and implementation. This authority and funding are available until January 1, 2027.
Funding for reentry and justice programs
Up to $8.4 million is available for the Board of State and Community Corrections to fund Impact Justice’s Homecoming Project, California Justice Leaders, and the Menopause Project. Up to 3% of the appropriation may cover BSCC’s costs to run the grants.
Grants for in-prison rehab programs
The law creates RIGHT Grant 3.0 with $20 million for nonprofit, trauma‑informed in‑prison programs. Eligible groups are 501(c)(3)s that ran in‑prison rehabilitative programs in at least two of the past five years and are offering an existing program. Awards use a point system based on an organization’s budget, with extra half‑points for women’s or underserved institutions and for serving special populations. The department posts the notice by October 1, 2025; applications are due within 60 days. CDCR reports to the Legislature by April 1, 2028, and grantees report by December 1, 2029. The program ends December 1, 2028.
Help for survivors of custody assault
The law provides $3 million to create a sexual assault response working group and an ambassador program for survivors in custody. $2.75 million goes to the Sister Warriors Freedom Coalition for staffing, meetings, whistleblower best practices, and trauma‑informed support. $250,000 covers working group expenses. The group must include department leaders, officers, community groups led by formerly incarcerated people, ambassador reps, and survivors. Funds are available until December 31, 2028, when the program ends.
More funding to support court operations
The state reimburses trial courts for service of process, specified Penal Code costs, and extraordinary homicide trials. $325,000 repays the State Auditor for trial court audits, and up to $1,887,000 covers Controller audit costs. $7,000,000 helps courts pay higher transcript rates. $32,884,000 funds CARE Act implementation. Up to $500,000 can be moved to pay the Judicial Council to run the civil representation pilot.
More pretrial services and clear rules
Courts get $63.95 million for pretrial programs, split by each county’s share of the 18–25 population. Funds can support decision‑making, technology, reminders, ability‑to‑pay checks, services, and supervision. Electronic monitoring is allowed only when less restrictive steps are not enough. $15 million stays available through June 30, 2028, and the Judicial Council can move unspent funds to higher‑need counties. Courts must contract with county departments (not arrest or prosecution agencies), with special permissions in Santa Clara and San Francisco, and must report program and spending data to the Judicial Council.
Short-term loans to climate fund
Finance can lend General Fund money to the Greenhouse Gas Reduction Fund when auction proceeds are late. Loans cannot exceed 75% of the item’s appropriation. Loans must be repaid by June 30 of the same fiscal year. Interest can be waived.
Stronger privacy in state cyber defense
The state cyber center must share threat information while protecting privacy and civil liberties. It must safeguard sensitive and business data. These rules help officials find and stop cyberattacks that threaten health or the economy.
$100 million for Fresno infrastructure
The state provides $100 million to GO‑Biz to fund the City of Fresno’s Public Infrastructure Plan. The money supports local projects named in the city’s plan and benefits Fresno residents and businesses.
Keep Next Gen 9-1-1 on track, fee cap
The Department of Finance can add funds mid‑year to finish Next Generation 9‑1‑1, but the monthly 9‑1‑1 surcharge cannot go above the January 1, 2025 rate. The Office of Emergency Services must report progress, costs, and fixes by November 1, 2025 and March 1, 2026. Funds also reimburse local agencies and vendors for eligible 9‑1‑1 costs. About $30 million is estimated to keep legacy 9‑1‑1 running through June 30, 2026.
Military cashflow help and cybersecurity funds
The Military Department receives $37 million in advance funds tied to Federal Trust Fund recoveries and must report quarterly to Finance. Up to $1.301 million supports the California Cybersecurity Integration Center. The Director of Finance may approve a short‑term General Fund loan up to $30 million to cover delayed reimbursements, to be repaid when ordered; interest may be waived.
More water project money stays available
The state reopens and extends water funds so work can continue. Up to $14.5 million and up to $1 million are available until June 30, 2027. Up to $20 million in 2021 emergency water items is also available until June 30, 2027. Time to spend a Greenhouse Gas Reduction Fund item and Water Quality Fund items is extended to June 30, 2027. The Water Resources Control Board’s support appropriation now also counts fines and penalties revenue.
More funding for public health work
The Public Health Department receives $16.212 million from the tobacco surtax for public and environmental health. It also gets $13.252 million for local assistance from the same fund. Another $3.505 million is transferred to the department’s Licensing and Certification Program Fund.
More mental health help statewide
The law provides $2 million to the Youth Mental Health Academy for a Los Angeles cohort. It also makes $20 million available for crisis prevention, early intervention, and crisis response through June 30, 2027. The funds support program services, not direct household payments.
More oversight and emergency health contracting
The health department must give yearly updates on Medi‑Cal system modernization. Reports list new contracts, why they were made, and their costs. The public health department can make or amend exclusive or nonexclusive contracts, bid or negotiated, to prepare for and respond to emergencies.
Pay past‑due health plan subsidies
The law pays retroactive premium assistance that is still owed to qualified health plan issuers from 2019 and 2020 budget items. Payments come from the current appropriation. This stabilizes exchange plans and supports continued coverage options for enrollees.
State hospital facility upgrades funded
The law provides $37.198 million for State Hospital capital projects. It includes $2.844 million for Napa electrical preliminary plans and $34.354 million to construct the Coalinga hydronic loop replacement.
Grants to address homeless encampments
The state provides $100,000,000 in grants to address encampments and connect people to housing and services. Up to 5% can pay for state administration. Funds are usable through June 30, 2030.
Housing funds for encampments and land
The law reserves up to 50% of encampment grants for projects on state right‑of‑ways that meet HCD and Caltrans priorities. If a local jurisdiction does not apply by HCD’s deadline, the local continuum of care can apply. It provides $1.44 million for HCD legal work and $2.4 million for the Surplus Land Unit. It also gives $3 million to San Benito High School District for workforce housing infrastructure.
No-interest state loans for CSU
In 2025–26, the Director of Finance can approve a no‑interest short‑term loan to CSU to address cash flow from state payment deferrals. The Director must notify budget leaders at least 30 days before the loan. The law does not fix the loan amount or terms.
State cash flow loans and advances
The law lets the Department of Finance create missing item numbers and pay lump sums in advance, including costs from before this section took effect. It allows short‑term loans to state agencies when federal funds are late, with repayment by June 30, 2026 and at least 20 days’ notice to lawmakers. It also lets Finance shift $109 million from the Health Care Affordability Reserve Fund to the General Fund in 2025–26 as a temporary budget loan.
State bargaining and position cuts
Lawmakers expect state employee unions to meet and confer with the Governor by July 1, 2025 to find savings. Position authority identified in the 2024 budget is eliminated on January 1, 2026, and the linked appropriations are removed.
State cuts if federal funds drop
If federal funding is reduced or ends, the Director of Finance can cut related state appropriations. Agencies must align services to available dollars through June 30, 2026. The Director cannot change who qualifies or benefit rules. Finance must give the budget committee at least 30 days’ notice unless the Chair shortens it.
Stricter checks before new program costs
Agencies must get Finance approval before any rule or directive that adds costs. For changes over $500,000 a year from the General Fund, Finance usually waits 30 days after notifying budget leaders. The Director of Finance will also adjust agency budgets to capture net savings and report changes to the Legislature.
Unspent dam and flood funds return
On June 30, 2025, unencumbered balances for several water safety projects revert: $47 million (dam safety), $15 million (systemwide flood risk reduction), $5.2 million, $2.5 million (systemwide flood risk reduction), and $8.8 million (urban flood risk reduction). This pulls back unspent money at year-end.
Community college payments pushed back
The state defers $408,363,000 in community college payments to 2026–27. The Chancellor’s Office may move money between schedules and set monthly deferrals, but must defer apportionments first.
CSU funding cut if enrollment falls
If CSU enrolls fewer resident undergraduates than the 2025–26 target, the state can cut funding. The cut is $10,983 for each full-time equivalent student below the target.
New rules for cutting preschool slots
If State Preschool slots must be reduced, the law sets the order to disenroll families. Those with the highest incomes under 85% of State Median Income go first, with ties broken by longest time in care and then exceptional needs. Children in or at risk of child protective services are protected regardless of income. The law also provides $1.009 billion for non‑LEA State Preschool and allows a short‑term General Fund loan up to $20 million, repayable within 90 days, to help cash flow.
Faster wildfire purchases and funding shifts
Finance can cut Greenhouse Gas Fund money if auction revenue is short and add the same amount to keep CAL FIRE fully funded. CAL FIRE can start some services July to September without a signed contract. Up to $1.804 million and up to $86.995 million get fast-track buying for food, lodging, training, and safety gear. CAL FIRE can contract up to $65 million a year for exclusive-use aircraft without normal bidding. Some prior funds are extended to June 30, 2026, and small unspent project amounts revert. The Greenhouse Gas Fund dollars in this item are exempt from several usual legal limits.
Parks and climate funds moved around
Parks funding of $13.96 million stays available through June 30, 2028. Some conservation balances are reappropriated and remain usable through dates listed in law. Reimbursements drop by $3.0 million, $750,000, and $1.922 million for named park projects. About $150,000 for Tahoe Conservancy work can be contracted without normal bidding. Some earlier climate and land use grant balances, including $9.8 million, $10 million, and $15 million, revert on June 30, 2025. One Natural Resources budget line is repealed.
Courts keep pretrial share; more funds possible
Superior courts may keep up to 30% of the pretrial program allocation to cover court costs, after contracting with the county and sending the rest to the county department. The Department of Finance may also add extra Trial Court Trust Fund resources to this item with joint legislative sign‑off and notice. This shifts up to 30% of pretrial funds to courts and allows controlled increases when added resources are available.
CSU funding delayed, special rules
A $252,255,000 CSU base increase is delayed from 2026–27 to 2027–28, with a one‑time back payment intended in 2027–28. CSU’s main state budget item is also exempt from two Budget Act sections, changing how that item is handled.
More money to retire old cars
The state can add funds to pay people who retire eligible vehicles in the Enhanced Fleet Modernization program. The Consumer Affairs department must request it. Any increase comes after 30‑day notice and must match real participation and revenues.
Payments for wolf livestock losses
The law makes $2 million available for the Wolf‑Livestock Compensation Program. Eligible livestock owners can apply for payments for wolf losses.
Funds for military retirements
The state allocates $480,000 for military retirement payments under Military and Veterans Code Sections 228 and 256. Eligible military retirees receive these payments.
HIV care and ALS support funds
The law provides $4.5 million and another $500,000 for HIV prevention, care, and treatment services. It also gives $3.5 million to the ALS Network for wraparound care for people with ALS and their caregivers. These dollars support services for eligible individuals.
More support for seniors and caregivers
The law provides $400,000 from a public health fund for local supportive services through the Department of Aging. It also requires Alzheimer’s Research Centers funds to go to direct services like screening, case management, disease management, and caregiver support.
Rapid rehousing for CSU students
The law provides $6.8 million to help homeless and housing‑insecure CSU students. Campuses can fund case managers, emergency housing, grants, and rental help, and must partner with community groups. Money is allocated based on need. Campuses must report use and outcomes each year.
CSU fee waivers for Medal of Honor families
The law funds $5.5 million ongoing for CSU fee waivers. Waivers cover Medal of Honor recipients, their children, and dependents of service‑injured veterans who attend CSU.
Easier transfer and course matching across colleges
The law funds $1.38 million for the HBCU Transfer Pathway. It adds $698,000 for transfer and articulation work and common course numbering. This helps students move credits and transfer more smoothly.
Faster teacher credentials and oversight
Finance can raise the Teacher Credentials Fund after a 30‑day notice if demand or legal costs rise. The Commission must report processing times twice a year, and the Attorney General must report on representation and costs. The Commission and Education Department must share data (without personal IDs) to spot teacher misassignments.
Grants to recruit more STEM teachers
The state provides $3 million for the STEM Teacher Recruitment Grant Program. Up to 5% may cover administration with Finance’s approval. Funds are available through the 2027–28 fiscal year and sunset June 30, 2028.
More college childcare and caregiver training
Community colleges get funds to train foster, relative, and kinship caregivers, with priority trainings set by law. The Chancellor also allocates funds to certain districts for on‑campus childcare and development, limited to districts that levied childcare override taxes in 1977–78. These dollars can be used only for community college childcare programs.
More worker rights outreach in rural areas
The law funds the California Workplace Outreach Project with $2.6 million, $5.85 million, and $4.55 million to educate workers on labor rights, with up to 15% for administration. It gives $4.36 million to the Rural Strategic Engagement Program and sets $3 million for rural community grants and $2 million for translation, design, printing, and social media. Lawmakers also fund a $500,000 study of the Garment Worker Wage Claim Pilot that cannot collect workers’ personal data.
One-time funds for Cal State Northridge
The law gives Cal State Northridge $806,000 one time for its Student Success and Inclusion Center. The money is for center infrastructure. It does not create individual student payments.
Pay raises for state active-duty military
The law provides $1.805 million so state active‑duty Military Department employees get the same pay increases as federal active‑duty counterparts, as required by state code. Any unspent funds return to the General Fund.
$2M for local community projects
$2,000,000 goes to the Initiating Change in Our Neighborhoods Community Development Corporation. GO‑Biz directs the funds to support local community projects. This is a grant to the organization, not a direct payment to households.
$5M for statewide Belonging Campaign
$5,000,000 funds the Belonging Campaign run by the Governor’s Office of Service and Community Engagement. Money is only for this program. Unused funds return to the General Fund.
Budget moves for health and social services
The Department of Finance can shift funds between listed health items to run workforce programs. Up to $1,382,000 for DHCS’s HR+ project can be spent only after the Department of Technology approves the project paperwork. The law reimburses Public Health $605,000 for lease‑revenue bond rent tied to DHCS space, with the Controller paying per the public works schedule. The Director of Finance may order transfers between two social services items and must notify budget chairs within 10 working days. Finance may also move federal funds so counties can run adoption programs and facility evaluations.
Faster state contracting in urgent programs
In emergencies, the health department can bypass certain procurement laws for urgent needs under a budget item. Sexual‑assault response and ambassador program agreements can skip normal approval steps to move faster. The Department of Finance can also extend its web‑development contract to keep work going on the Governor’s Budget Presentation System through June 30 each year.
Flexible budget moves to keep programs running
The Director of Finance can shift spending and positions between key education and social services items, including moving up to $5 million across schedules to match Early Intervention and Early Start costs. Transfers must keep net appropriations level. For certain General Services costs, amounts can be adjusted after a 30‑day notice and not for costs known at the May Revision. For Human Resources items, transfers require 30‑day notice to lawmakers.
Funding for Climate Action Service Corps
The law provides $9.383 million to run the California Climate Action Service Corps and fund local climate service work. The money supports program staff and local partners, not direct payments to households.
Funds for cultural sites and river
The state provides $2.5 million for the Historic South Los Angeles Black Cultural District, with up to 1% for admin costs, available until June 30, 2028. With tribal agreement, up to $150,000 is available to maintain, repair, or relocate the California Native American Monument. The law also gives $40,000 to the San Diego River Conservancy for program activities.
Funds for legislative budget and analysis
The law provides $13,334,000 for the Legislative Analyst’s Office and the Joint Legislative Budget Committee. Payments are made on certification by the JLBC Chair. The Senate and Assembly may transfer money from their operating funds to this item.
Funds for local legal defense work
Three local government legal offices each receive $2 million, for a total of $6 million. The funds pay for administrative actions, affirmative litigation, and defense against federal enforcement or legal actions.
Funds to carry out SB 1203
The law provides $2.5 million to the Department of General Services to implement Chapter 368 of 2022 (SB 1203).
Funds to cover state legal claims
Transportation has $75.556 million to pay tort claims and awards, with up to $20 million more allowed after notice. Unneeded funds may revert on April 1 each year. Finance may also add money for the Insurance Department’s increased legal costs after a 10‑day notice to budget leaders.
Funds to run Elder Justice Award
The budget provides $186,000 to administer the Elder Justice Award. The money is available to spend until June 30, 2027. This pays program costs and does not create new direct payments to households.
Grants for victims, security, and fire
The law sets aside $25.15 million for targeted grants. $10 million goes to family justice centers for victim legal help and protective orders. $10 million funds World Cup security in the Bay Area and Los Angeles. $5 million improves a Fresno fire training center. $150,000 upgrades a Covelo fire hydrant system.
IT upgrade for public-works enforcement
Up to $9.5 million is available for the system integrator part of the Public Works Strategic Enforcement Project. The funds become available only after the Department of Technology approves the project report and the Department of Finance orders the funds.
Keep UC animal disease labs funded
Funding for UC poultry and livestock disease labs now adjusts each year for UC employee pay and benefit changes. This keeps labs staffed and operating as costs rise.
More flexibility for wildfire response
CAL FIRE may change pilot, mechanic, and parts contracts to meet extra workload. Finance can add money after a 30‑day notice. CAL FIRE gets $2.25 million for repairs and maintenance to support more hand crews, available through June 30, 2030. Finance may approve a short‑term General Fund loan up to 45% of Schedule (2) reimbursements to cover cash gaps, to be repaid by November 15 of the next fiscal year; interest may be waived, and Finance must notify the JLBC within 10 days.
More funding for parks and trails
The State Library Parks Pass Program gets $6.75 million, and the Controller transfers $6.75 million to the State Parks and Recreation Fund. Parks also gets $1.19 million from the Safe Drinking Water, Wildfire Prevention, Drought Preparedness, and Clean Air Fund. Will Rogers State Historic Park restoration gets $3.6 million, available through June 30, 2028. The State Coastal Conservancy gets $261,000; Santa Monica Mountains Conservancy gets $400,000; $5 million funds San Vicente Mountain Park access and wildfire prevention work; the San Gabriel Rivers Conservancy gets $200,000. By January 10, 2027, the Administration must propose a plan to keep the Harbors and Watercraft Revolving Fund in balance.
More help for crime victims
The law provides $97 million to boost local services for crime victims under the federal VOCA program. It also gives $3 million to run these grants. If the Office of Emergency Services does not need some admin money, Finance can move it to local victim grants.
More support for cannabis regulation
Up to $4.1 million pays Office of Administrative Hearings costs for cannabis cases. Finance can add money for cannabis litigation and hearings, up to the Cannabis Control Fund balance, after a need is shown and notice is given. $568,000 reimburses Public Health for lease-rental costs tied to the cannabis lab space in Richmond.
More time and small funds for conservation
The state directs small amounts to natural resources work: $151,000 for trails, $164,000 for marine wildlife and coasts, $111,000 for green infrastructure, $698,000 for flood projects, and $1,358,000 for bond costs. It also gives $562,000 for Natural Resources Agency administration. Prior natural resources funds are reappropriated and can be used through June 30, 2027 and June 30, 2028.
Public hospital gets easier loan terms
Palomar Health starts loan payments 36 months after the loan date. It must finish paying within 24 months after payments begin. The interest rate is 0%. There is no prepayment penalty.
Rail funding and DOT staffing flex
If the Transportation Commission reprograms old STIP projects, Finance can increase staffing for project support after a 30‑day notice. $2.725 million for DOT equipment stays available to spend through June 30, 2028 and liquidate through June 30, 2030. Sonoma‑Marin Area Rail Transit gets $4 million for freight operations, capital needs, and deferred maintenance.
Shift transit funds; buy cleaner vehicles
The state can move money between two transportation schedules when Finance approves. When replacing vehicles, the transportation department must buy zero-emission vehicles when feasible. If not feasible, it must choose the lowest-emission options.
Stronger crackdowns on fentanyl and crime
The law gives $6.666 million to fight fentanyl production and trafficking, with DOJ able to work with health and military departments. It adds $361,000 for organized retail crime cases; unused funds return to the General Fund. It provides $7.206 million to target violent criminals, gangs, illegal drugs, and illegal firearms. Up to $5 million strengthens CHP investigations of child sexual abuse material and human trafficking. Up to $10 million for law enforcement mutual aid remains available through June 30, 2029.
Support for veterans cemetery operations
The law provides $4.5 million for Southern California Veterans Cemetery operations. It also authorizes the Controller to transfer $4.5 million into the cemetery’s master development fund.
Upgrades to DOJ tech and legal work
DOJ can buy or lease vehicles for investigations, but not military-classified ones unless allowed by law. DOJ can spend $2.428 million to implement Chapter 811 (2024) after it submits a Stage 1 Business Analysis. DOJ gets $3.132 million to connect CLETS to the DMV’s digital platform; if it won’t be ready by June 30, 2026, DOJ must report by January 10, 2026 with a plan. DOJ has $12.318 million for legal workload tied to federal actions and must report each year by August 1 on how it uses the funds.
Inflation-adjusted budget for privacy agency
The California Privacy Protection Agency’s budget adjusts each year by the California CPI change from August to August. The agency must show the CPI calculation in its spending plan.
Privacy rules for volunteer database
The California Volunteers database must follow all state privacy and use rules set by the Department of Technology. This protects volunteers’ personal data and reduces misuse risk.
Stronger enforcement of tenant rights
The law gives $3,000,000 to the Department of Justice to boost work that protects tenants. The money must add to current efforts and cannot replace them. It cannot be used for other section work.
Wildfire risk work for communities and homeowners
The Department of Insurance gets $12.5 million for community hardening oversight and wildfire risk mitigation. Funds support measuring risk for communities and residential property owners and planning mitigation.
Conservation and bioeconomy grants
The law gives $50,000 to the Sierra Nevada Conservancy. It also provides $8,000,000 to BEAM Circular for the California Bioeconomy Innovation Campus in the North San Joaquin Valley to support waste reduction and recycling.
Extra DOT funds for ADA access needs
Finance may add up to $2 million for Americans with Disabilities Act consultant contracts when DOT access requests and grievances exceed projections. The state must give 30 days’ written notice to fiscal committees before using this authority. This helps DOT respond faster to ADA access needs.
Keep libraries and audit panel funded
Up to $4,290,000 is reappropriated to the State Library for payroll for 2024–25 and 2025–26, usable through June 30, 2027. Up to $209,000 is reappropriated to the Education Audits Appeals Panel, usable through June 30, 2026.
Keep state water programs running
The law sets aside $246,000 for the California Water Plan and lets the money move to Fund 0691 for operations. Program 3571 funds must run the Administrative Hearings Office. Program 3575 can reimburse the Department of Justice for legal work after a 30‑day notice. Finance can approve a short‑term loan up to $15,000,000 to keep Water Board operations going until fee revenue arrives; interest may be waived.
Local water and fire recovery funds
The state grants $6,000,000 for local drinking water and irrigation projects: $1,000,000 to San Juan Bautista, $4,000,000 to Monterey County for San Lucas, and $1,000,000 to San Francisco Public Works. It also provides $4,500,000 related to the Eaton Fire: $500,000 for mosquito control and $4,000,000 to the Foothill Municipal Water District for water system impacts.
Lower DOT charges for local projects
The Department of Transportation no longer fully recovers costs from local agencies for project initiation document (PID) work it does. DOT also streamlines PID cooperative agreements to cut admin time and cost. Deprogrammed SB 45 STIP projects that locals keep funding are exempt from full cost recovery, and DOT will not charge overhead on the portion once planned from the STIP.
Modernize unemployment systems and oversight
The state funds $62,117,000 for EDD modernization, available through June 30, 2027. Another $31,059,000 is released only after Finance approval, a 30‑day legislative notice, and technology approval. EDD must send quarterly progress reports to Finance and the Legislative Analyst’s Office.
More time for CAL FIRE funds
CAL FIRE can keep using several prior-year funds longer. Examples include up to $2.691 million for a research project (spend by June 30, 2026; liquidate by June 30, 2029) and up to $10.945 million available until June 30, 2026. Greenhouse Gas Reduction Fund amounts of up to $6.075 million (2018) and $3.422 million (2019) are available until June 30, 2026. Other smaller amounts and transferred funds are extended for encumbrance or liquidation through dates ranging from June 30, 2026 to June 30, 2028.
Transportation funds and high‑speed rail
The state can move $81,176,000 from the Greenhouse Gas Reduction Fund to the Motor Vehicle Account when Finance orders it. The Department of Finance may also add up to $900,000 so Caltrans can accept reimbursements from the High‑Speed Rail Authority for required reviews. Finance must give a 30‑day written notice before making that augmentation.
Financial regulator budget and fee transparency
By March 1, 2026, and each year after, the state financial regulator must report projected and actual revenues and spending for listed subprograms. The Digital Financial Assets subprogram’s first report is due February 1, 2027, then every March 1. After any fee or assessment change, the department must send a written update within six months showing fund balance, spending, and solvency. The first such update is due by February 1, 2026.
More oversight of finance and advisers
The law provides $1 million one time to keep the CalAccount Blue Ribbon Commission working on public banking feasibility. DFPI must file an annual January 10 report with the Governor’s Budget on its Broker‑Dealer and Investment Adviser Program, including staffing, exams, results, and needed staff to meet targets.
Community health worker voice continues
The health department keeps an Advisory Workgroup through June 30, 2026. Most members must be active community health workers or Promotores. The group advises on workforce policy. It does not create new payments to individuals.
Community voice in rural clinic reviews
Vendors who evaluate the Rural Strategic Engagement Program must consult community‑based organizations when designing how to judge clinic success. This adds local input into the evaluation rules.
Extend LGBTQ+ and reproductive funds
The law reappropriates remaining funds for LGBTQ+ and reproductive health programs. The money can be spent or committed until June 30, 2027. It supports services for lesbian, bisexual, and queer women, training and care for LGBTQ+ foster youth, and reproductive rights awareness and research.
Faster contracts for HIV/AIDS programs
Office of AIDS contracts and grants are exempt from Public Contract Code review and no longer need DGS approval before execution. The Office must still follow other public health contract rules. This speeds awards for HIV/AIDS programs.
Faster contracts for TGI health grants
Contracts paid from the TGI Wellness items can skip many state procurement rules and do not need Department of General Services approval. This speeds Department of Public Health contracts and local assistance grants funded by the TGI Wellness Fund.
Funds for disease registries and fitness
Up to $2.997 million is reappropriated for the Parkinson’s and neurodegenerative disease registries. Up to $2.5 million is reappropriated for the Governor’s Fitness Council. These funds are available until June 30, 2027.
Keep 2026 state worker health benefits funded
The Director of Finance can adjust the budget to match 2026 health premiums set by CalPERS and dental premiums set by CalHR. Any change must be reported in writing within 30 days to the Joint Legislative Budget Committee and appropriation chairs. This keeps employee health and dental benefits funded.
More funding for primary care training
The law funds primary care residency slots and loan repayment. Up to $18.667 million supports existing slots, $3.333 million adds new slots, and $5.667 million funds teaching health centers. Up to $3.333 million can help newly accredited programs, with unused amounts shifted after June 30, 2027. Up to $333,000 supports the State Loan Repayment Program. It also provides $2.8 million each year for the California Medicine Scholars Program. Funds are available until June 30, 2030.
State partnerships to boost drug supply
The law reuses prior funds so the health agency can partner to make, buy, and distribute drugs and some medical devices. It allows up to $2.87 million and up to $2.75 million from listed items. The funds are available until June 30, 2028.
Upgrades at two health clinics
The law gives $3 million to Northeast Valley Health Corporation for facility work and expansion. It also gives $500,000 to the American Reproductive Centers Fertility Clinic in Palm Springs for repairs. These are grants to providers, not direct payments to households.
Adjust EDD transfers to match needs
The Department of Finance can change transfer amounts so they match the Employment Development Department’s approved plans. This applies to the Unemployment Administration Fund and the Consolidated Work Program Fund. It keeps program funding aligned with actual administrative and program spending.
Court employee and judge benefit funding
The Department of Finance can add funds to pay trial court employee benefit increases in 2025–26. Finance may transfer money to the Judicial Branch Workers’ Compensation Fund to pay claims and administrative costs. The law also makes funds available to cover workers’ compensation costs for trial court judges.
Faster hiring for behavioral health work
The agency may contract with an administrator for BH‑CONNECT workforce efforts to make payments, monitor compliance, help grantees, and report results. These contracts can skip Chapter 6 competitive bidding and some state review steps to speed delivery.
Goods movement training campus funding
The law provides $20 million for a Southern California goods movement training campus. The funds are allowed as advance payments, despite other laws, to speed project work.
Job training in wildfire-hit communities
The law gives $5 million to fund job training and reemployment in parts of Los Angeles and Ventura counties hit by wildfires. This supports workers who lost jobs or need new skills.
More tools and funding for labor enforcement
Labor agencies can use the Uninsured Employers Benefits Trust Fund to fight the underground economy. Several labor and safety funds now clearly include fine and penalty revenue. The Department of Industrial Relations can spend certain workforce funds through June 30, 2030. These steps support wage, safety, and public‑works enforcement.
One-time grants to two colleges
The law provides $20 million one time to California College of the Arts, with a report to the Department of Finance due by November 2026. It also provides $10 million one time to California Indian Nations College.
State job cuts paused until 2026
The Department of Finance must send lawmakers a list of proposed job eliminations by September 30, 2025. If it misses that date, those vacant positions cannot be cut until the 2026 Budget Act. Named agencies must keep certain vacant positions through January 1, 2026, while lawmakers can review and object.
State worker pay and contract transparency
CalHR can fund detailed salary surveys and must send each report to legislative committees and the LAO within 30 days of completion. The Director of Finance can approve a short‑term General Fund loan to CalHR up to 15% of reimbursements, to be repaid by September 30, 2026. CalHR must promptly post all signed MOU addenda, side letters, appendices, attachments, and fiscal summaries on its public website. The Department of Finance must notify the Joint Legislative Budget Committee of any spending from an MOU addendum not in a budget bill and include the addendum and fiscal summaries for 2025–26 and future years.
Study to align training with jobs
The law provides $1 million to evaluate how to expand regional forums where educators, training providers, and employers align programs with job needs. The study is done with the State Board of Education and the Community Colleges Chancellor’s Office.
Wildfire aid for schools and colleges
The law gives $1.8 million to two K–12 districts hit by the January 2025 Los Angeles wildfires. It also provides $8.065 million one‑time to backfill property tax losses for community college districts affected by January 2025 fire emergencies. Funds are restricted to the named districts or districts impacted by those emergencies.
Youth Corps funds for tribes and cities
The law reserves $2 million of Youth Corps funds for California tribal communities through a competitive process. After that, part of the money goes to the 13 largest cities by population share using state estimates. Remaining funds are awarded competitively to other cities and counties, regardless of size.
Funding to modernize tax systems
The Franchise Tax Board gets reappropriations for its Enterprise Data to Revenue Project. Up to $14.54 million is for unplanned work, up to $6.774 million for vendor pay, and up to $2.25 million for a high‑speed printer. Funds are available until June 30, 2026.
Funds to move Treasury staff
The law provides $735,000 one time to move staff and contents into the State Treasury Building. The Director of Finance can approve extra costs, but only after a 30‑day written notice to budget leaders.
More time to use farm funds
Food and Agriculture project funds are reauthorized. Up to $2.971 million supports the Emerging Threats 2 IT Project and up to $17 million supports the Alternative Manure Management Program, available to encumber until June 30, 2026 and liquidate until June 30, 2029. Other items, including up to $900,000 for fairs resiliency and $15,000 for pest management, are available through June 30, 2027.
Tools to manage state cash and markets
Finance can approve a short‑term General Fund loan to the State Treasurer, up to Schedule (2) reimbursements, with repayment within six months and required legislative notice. Finance may authorize up to $1.7 million beyond an item to cover costs from canceled bond or note sales, with Treasurer certification and notice to fiscal chairs within 30 days. The Treasurer may buy proprietary market data and research, capped at $300,000 per agreement, through July 1, 2026 (or until a new purchasing process is in place).
Short-term loan for state real estate
The General Fund can loan up to $2,000,000 to manage state real property when sale proceeds are not enough. The loan must be repaid within 60 days after the close of escrow, using the sale proceeds.
No state funds for deportation defense
Equal Access Fund money cannot pay for legal defense against removal from the United States. People facing deportation cannot get representation from this fund.
Tax collection and filing fees for 2025–26
In 2025–26, the Franchise Tax Board charges these per‑case fees. If subparagraph A applies, the collection fee is $362 and the filing enforcement fee is $131. If subparagraph B applies, the collection fee is $292 and the filing enforcement fee is $116.
Some disaster aid money returned
On June 30, 2025, up to $13 million for a home hardening program and up to $49.65 million for survivor aid grants revert to the fund. Less money remains for those programs after that date.
Unspent CAL FIRE money reverts 2025
On June 30, 2025, unencumbered balances from certain CAL FIRE appropriations return to their original funds: $500,000 (2020 item), $2.96 million (2021 item), and $849,000 (2022 item). This reduces CAL FIRE’s available program funds after that date.
Funds set aside for ACA penalties
Money in Schedule (2) of Item 9800-001-0494 can pay penalties the state may owe under the Affordable Care Act or other individual‑mandate systems. The law does not list a dollar amount here.
Housing and consumer agency funds on hold
Spending tied to reorganizing the Business, Consumer Services, and Housing Agency is paused. Money cannot be used until the Governor’s Reorganization Plan No. 1 of 2025 takes effect.
Limits on CSU payments and health funds
From July through April, monthly state payments to CSU cannot exceed one‑twelfth of the annual amount, excluding certain transfers. On June 30, 2025, any unspent balances from named CSU health‑benefit appropriations return to the General Fund.
Cut to community renewable energy funding
On June 30, 2025, up to $33 million reverts from funds for Community Renewable Generation and Storage programs. This reduces the money available for those programs.
Legal aid grant focus and limits
Grant reviewers must prefer proposals serving rural or underserved immigrant communities and partnerships with community nonprofits. But grant funds may not be used to defend people against deportation. Unused funds will be reallocated under Legal Services Trust Fund rules.
Labor bargaining support and contract rules
Up to $650,000 funds an audit of work by state scientists; any unused funds return to the General Fund and Finance must notify budget leaders of changes. The state provides $3.3 million to support statewide collective bargaining for IHSS providers. Some contract addenda can start after 30 days’ notice if 2025–26 costs are under $1 million and covered within existing funds, but larger addenda need a new law.
Boards can use fines; fund loan terms
State licensing boards can count fine and penalty revenue in their appropriations. Loans to the Private Postsecondary Education Administration Fund must be repaid by June 30, 2032, with interest at the state pool rate.
Cover federal penalties and cashflow
The law makes $6 million available to pay penalties the state may owe under the Affordable Care Act or other individual health mandates. The Director of Finance may add up to $1 million and direct payments to the U.S. Treasury or other federal entities; the Controller makes those payments. The Director of Finance may also approve a General Fund loan to DOF in 2025–26 to meet cashflow needs up to the amount of estimated uncollected reimbursements for the final quarter.
Deadlines and transfers for payroll cost funds
On July 31, 2026, unspent balances in several statewide payroll and benefit items will revert and can’t be spent after that date. The Department of Finance can move money between related items to cover approved labor agreements and excluded employee pay. The department can also bill agencies for their share of employer reporting penalties, including CSU and those outside the State Treasury.
Deletes several one-time budget items
The law repeals three specific budget items: 0509-495, 3900-102-0115, and 4140-001-3447. These deletions change budget language but do not, by themselves, set new payments or taxes.
Eminent domain for parking project
Funds for the South East Underground Parking Structure can pay to remove and replace nearby signs. The project may acquire property rights, including by eminent domain under state law. This supports project work but may affect property owners near the site.
Guardrails on pretrial service contracts
Counties may hire community groups to add pretrial services only if strict rules are met. Contracts must show transparency, results, and cultural competence. They cannot replace county jobs, must pay workers wages and benefits like public employees, and cannot set executive pay far above public peers. Counties must consult the court before contracting.
Licensing boards oversight and funding flex
Certain state boards may count fines and penalties as part of their budgets. Finance may add up to $200,000 for athletic inspectors and training after 30 days’ notice. Finance may add funds to cover higher legal costs for private postsecondary oversight after a 10-day notice. The Consumer Affairs Director must report each year by December 31 on the licensing system transition, including costs, plans, and timelines.
Limits on temp staff; 16 new judges
Courts can fund assigned judicial work, but support staff from those funds cannot exceed what three judges would need. Courts must first use available judges. The Judicial Council may convert 16 subordinate judicial officer positions into judgeships in 2025–26.
Moves court balances and facility funds
Finance, after consulting the Judicial Council, can transfer excess unrestricted Trial Court Trust Fund balances to the General Fund, with required notice. The law also appropriates $1,000 and lets Finance increase transfers to the State Court Facilities Construction Fund when revenues there fall short, after 30 days’ notice. These actions shift money between court funds based on needs.
Prior budget items repealed
The law repeals a specific Budget Act line item (6120‑211‑0890). It also repeals Section 19.80 of the Budget Act of 2025. The effects depend on what those provisions previously funded or required.
Rules and deadlines for special state allocations
Certain state allocations are exempt from normal personal‑services contracting and do not need Department of General Services approval. Money can be encumbered or spent through June 30, 2027 and liquidated through June 30, 2029, but projects generally cannot receive funds before September 30, 2025. These funds cannot be used for purposes that count under Proposition 98; if they would, the Department of Finance must not allocate them and must notify lawmakers. The department can extend some earlier budget deadlines to no later than June 30, 2028 with notice.
New rules and reports for state AI
State agencies that use Generative AI must complete a GenAI risk assessment, a privacy impact check, and follow IT project delivery rules. Agencies must send GenAI project documents to the Legislature, and funding requests go through the normal budget process. By March 1, 2026, an administration official must report on the first GenAI pilots, including what worked and how pilots that became contracts were funded.
Health data funding with safeguards
In fiscal year 2025–26, the Managed Health Care department may transfer up to $4.9 million to the Health Care Payments Data Fund after required transfers. Another $6.209 million for the Health Care Payments Database Project is held until the Department of Technology approves a Post‑Implementation Evaluation Report. This supports the data program but delays spending until the report is approved.
CSU transitions and turnaround plans
The law provides $25 million to help Humboldt State transition into a polytechnic university. CSU campuses with long enrollment declines must submit turnaround plans by December 31, 2025, with strategies, five‑year projections, and timelines. The Chancellor’s Office must deliver a combined report by March 1, 2026.
Education funds oversight and reversions
Finance now has final say on budgeting and accounting for the Education Protection Account. Also, $250,000 set aside for the Student Aid Commission reverts to its fund on June 30, 2025.
Rules on CSU funds and aid
The Controller transfers CSU base rental funds per the finance schedule and must send $49,000 to the Public Buildings Construction Fund within 30 days of enactment. If CSU raises systemwide tuition for 2025–26, the Director of Finance may reduce CSU appropriations by the estimated increase in Cal Grant and Middle Class Scholarship costs, after giving at least 30 days’ notice. The Student Aid Commission must report by December 1, 2026 on 2025–26 Cash for College spending, including regional partners, services, workshops, and student participation.
Tighter education advisories and contracts
The Department of Education cannot spend to make statewide pupil test summaries or collect private‑school data for very small schools. It also cannot issue advisories unless the State Board approves them. Visiting educators and some consultants must disclose finances, cannot displace represented civil servants, and cannot be paid more than 10% above comparable civil service pay plus benefits.
Tighter rules on prison reentry grants
RIGHT Grant 3.0 money cannot pay for college classes inside state prisons. Administration costs are capped at 3% of the grant. This narrows uses but keeps more funds for direct services.
Sponsors & Cosponsors
Sponsor
Jesse Gabriel
Democratic • House
Cosponsors
There are no cosponsors for this bill.
Roll Call Votes
Senate vote • 6/27/2025
Item 78 — Senate SFLOOR
Yes: 29 • No: 8
House vote • 6/27/2025
Item 1000 — Assembly AFLOOR
Yes: 59 • No: 17
legislature vote • 6/25/2025
Vote in CS62
Yes: 13 • No: 4
House vote • 3/20/2025
Item 32 — Assembly AFLOOR
Yes: 53 • No: 17
Actions Timeline
Chaptered by Secretary of State - Chapter 5, Statutes of 2025.
6/27/2025SenateApproved by the Governor.
6/27/2025legislatureEnrolled and presented to the Governor at 3:15 p.m.
6/27/2025legislatureSenate amendments concurred in. To Engrossing and Enrolling. (Ayes 59. Noes 17. Page 2331.).
6/27/2025HouseAssembly Rule 63 suspended. (Ayes 54. Noes 19. Page 2329.)
6/27/2025HouseIn Assembly. Concurrence in Senate amendments pending.
6/27/2025HouseRead third time. Passed. Ordered to the Assembly. (Ayes 29. Noes 8. Page 1803.).
6/27/2025SenateRead second time. Ordered to third reading.
6/26/2025SenateFrom committee: Do pass. (Ayes 13. Noes 4.) (June 25).
6/25/2025SenateFrom committee chair, with author's amendments: Amend, and re-refer to committee. Read second time, amended, and re-referred to Com. on B. & F. R.
6/24/2025SenateIn committee: Hearing postponed by committee.
6/11/2025SenateReferred to Com. on B. & F. R.
4/2/2025SenateIn Senate. Read first time. To Com. on RLS. for assignment.
3/20/2025SenateRead third time. Passed. Ordered to the Senate. (Ayes 53. Noes 17. Page 714.)
3/20/2025HouseRead second time. Ordered to third reading.
3/18/2025House(Ayes 53. Noes 17. Page 643.)
3/17/2025HouseOrdered to second reading.
3/17/2025HouseWithdrawn from committee.
3/17/2025HouseReferred to Com. on BUDGET.
2/3/2025HouseFrom printer. May be heard in committee February 8.
1/9/2025HouseRead first time. To print.
1/8/2025House
Bill Text
Chaptered
6/27/2025
Enrolled
6/27/2025
Amended Senate
6/24/2025
Introduced
1/8/2025