Assembly's Budget Would Expand Tax Credits, Medi-Cal Coverage

Increasing the earned income tax credit, expanding Medi-Cal to cover all the uninsured, making early education available to all 4-year-olds. Those are among the budget priorities released today by Assembly Budget Committee Chairman Phil Ting (D-San Francisco).

He says the state is on better financial footing now, but still has years of cuts to make up for.

“We cannot ignore the fact that not all Californians have benefited from our state’s renewed prosperity," Ting says.

His committee's budget proposal uses projections from the Legislative Analyst's Office, which assumes $7.5 billion in discretionary funds for the 2018-2019 fiscal year. Of that, Ting proposes putting $3.2 billion in a reserve fund and using $4.3 billion to pay down debts and fund various projects. He says many of the priorities listed in his plan could be phased in and out as needed.

As it's now written, Ting says, the federal tax bill being considered in Congress would not directly affect the state budget. But that could change.

"What the Republicans have said is, based on the increase in tax cuts, they are going to have to cut future spending down the road," Ting says. "They've singled that they are going to start attacking Medicare."

If that happens, it could affect the state's bottom line.

Ting says they are preparing for various scenarios based on what action the federal government might take. But he says right now it's too early to tell what might happen.

This is an early step in the budget process. The governor will release his own proposal in January. The Senate budget committee will release its version as well. All three sides must then negotiate and the Legislature must approve a final version by June 15.