California’s Democratic leaders and Governor Gavin Newsom have agreed on a $297.9 billion budget to address a $47 billion shortfall. This deal includes funding for homelessness programs, prison budget cuts, and a delayed healthcare worker minimum wage increase.

The budget, effective from July 1, 2024, includes an 8% cut in state operations and utilization of reserves to fill the budget gap. Assembly Speaker Robert Rivas and Senate President Pro Tem Mike McGuire emphasized the budget’s focus on housing and social services, despite initial disagreements with Newsom.

The Legislature secured $1 billion for Homeless Housing, Assistance, and Prevention grants, despite Newsom’s initial reluctance. Additionally, $750 million will be cut from the California Department of Corrections and Rehabilitation, exceeding Newsom’s original proposal.

The budget also includes funding for public health initiatives and in-home supportive services for undocumented immigrants. A compromise was reached on health care provider rate increases for Medi-Cal patients, and the state will delay the health care worker minimum wage hike, depending on financial conditions.