Today, January 10, 2020, Governor Gavin Newsom released his proposal for the 2020–21 State Budget, his second budget proposal as California’s chief executive. The Governor is proposing significant changes and additional investments in several education areas including special education, educator recruitment and professional development, increased transparency for the Local Control Funding Formula (LCFF), and additional funding and opportunities for community schools and low-performing schools.
The Governor has proposed a 2.29% increase to the local control funding formula as a cost-of-living adjustment.
As the Department of Finance has been signaling in recent monthly Finance Bulletins, the 2020–21 State Budget proposal reflects a revised revenue forecast that is $5.8 billion higher from 2018–19 through 2020–21 compared to the 2019–20 State Budget Act. Over the three fiscal years, the personal income tax is down $1.5 billion, the sales and use tax is up $129 million, and the corporation tax is up almost $5 billion.
The budget continues to build additional reserves for the state’s Rainy Day Fund. The Governor’s proposal assumes nearly $2 billion in 2020-21 and an additional $1.4 billion over the remainder of the three-year forecast period. The state’s Rainy Day Fund is projected to be $18 billion in 2020–21 and $19.4 billion by 2023–24.