Story perspectives

California Budget Avoids Deficit, Adds $1 B Tax Revenue

5/15/2026

Summary

Story summary

$350 billion budget avoids a deficit in Newsom's final year and next.
Revenues $16.5 billion above forecasts prevented a $2.9 billion shortfall.
It creates $9.7 billion holding account and earmarks $300 million for health subsidies, $5 billion for teacher training, $100 million for Los Angeles homeowners.
Tax changes—small-business fee cuts, limited 2027 credits, and a digital-services tax—raise $1 billion in year one.
Newsom rejected a billionaire tax ballot measure and proposed raising undocumented adults’ premiums from $30 to $50.

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Story summary

$350 billion budget avoids a deficit in Newsom's final year and next.
Revenues $16.5 billion above forecasts prevented a $2.9 billion shortfall.
It creates $9.7 billion holding account and earmarks $300 million for health subsidies, $5 billion for teacher training, $100 million for Los Angeles homeowners.
Tax changes—small-business fee cuts, limited 2027 credits, and a digital-services tax—raise $1 billion in year one.
Newsom rejected a billionaire tax ballot measure and proposed raising undocumented adults’ premiums from $30 to $50.