California Sues Trump Administration Over Attempts To Freeze Childcare Funding

Here are the morning’s top stories on Friday, January 9, 2026

• The state of California is suing the Trump administration for freezing billions of dollars in federal child care and welfare funding. The federal government said it was withholding the funds from California and four other Democratic-led states over fraud allegations.
• San Diego is home to the nation’s second largest Somali population. And recent allegations of fraud at Somali-owned child care centers in Minnesota have now spread to their community. Somali childcare providers in San Diego say strangers are now surveilling their centers. 
• Governor Newsom is releasing his state budget plan Friday. This comes a day after Newsom delivered his final state of the state address at the capitol, touting California as “a marvel of invention and reinvention.”

California Sues Trump Administration Over Loss Of Child Care Funding

Attorneys general in five Democratic-led states, including California, filed a lawsuit Thursday against President Donald Trump’s administration after it said it would freeze money for several public benefit programs, citing concerns about fraud in the programs designed to help low-income families.

The states — California, Colorado, Minnesota, Illinois and New York — called the move an unconstitutional abuse of power. The Trump administration announced earlier this week it was withholding their social safety net funding. The funding went toward three federal programs, two of which focus on lifting families with children out of poverty.

The funding freeze stems from a social media video claiming that Somali-run child care centers in Minnesota committed fraud. California child care facilities say they already have safeguards in place  to track attendance, to make sure public funds are being spent on children.

Somali Child Care Providers In San Diego Say Strangers Are Surveilling Their Centers

Samsam Khalif has provided child care in San Diego long enough to watch babies become adults. Some still come back to visit her. She loves her work. Now, she’s afraid. On Tuesday, she was returning home with children in her car and saw two young men with a camera parked outside. She was scared. She circled the block twice, hoping they would leave. She didn’t want to keep the children in the car for too long, so she eventually parked and went inside. She said when the men saw her enter with the children, they drove away. She’s not alone in her experience.

In December, President Donald Trump called Somali people “garbage.” Weeks later, a YouTube influencer began surveilling Somali-run child care centers in Minnesota and making unverified claims of fraud.

The San Diego Chapter of the United Domestic Workers of America said it’s heard of at least seven incidents since Monday of strangers surveilling, harassing, and even stalking Somali child care providers — and the incidents are likely underreported. They encouraged providers to report these incidents to the police as hate crimes and to make sure they get the incident report number.

In Final State Of State Speech, Gov. Newsom Says California Offers Model For The Nation

On Friday, Gov. Gavin Newsom’s office said the state faces a $2.9 billion budget deficit this year, an amount significantly lower than what legislative budget analysts projected.

This comes a day after Newsom used his final State of the State speech to deliver a full-throated defense of the state and his tenure in office — arguing that California can offer an affirmative alternative vision for the future. Newsom mounted a defense of his record on homelessness and climate leadership, while advancing proposals to crack down on corporate homeownership and reform how the state’s education system is governed. He cited a huge growth in revenues — more than $40 billion higher than forecast last year — and touted California’s progressive tax system, which relies far more on top earners than many other states.

Among his specific proposals, Newsom called for new laws to make it harder for private equity firms and other large investors to snap up huge numbers of properties, saying it is driving up housing prices and moving homeownership out of reach. And, he said the state should implement long-talked-about reforms to its education system, moving the Department of Education into the executive branch.

Ahead of an expected run for president in 2028, Newsom continued his sharp criticism of President Donald Trump, calling the federal government “unrecognizable” and corrupt. “For 175 years, California has been a marvel of invention and reinvention, disaster and recovery, grit and ingenuity. We have found a way to build the future, over and over,” Newsom said in a fiery opening to his speech. “But today, that spirit is being tested. We face an assault on our values unlike anything I have seen in my lifetime.”