The Brief

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In 2019, first-year Gov. Gavin Newsom inherited a state flush with cash. With a $21.4 billion budget surplus to play with, an ambitious Newsom invested billions in affordable housing, child care and healthcare expansion while paying down the state’s debt and shoring up reserves.

The next governor won’t be that lucky.

When Newsom unveils his last spending plan as governor Friday, he will do so with the specter of a projected $18 billion deficit — the result of the state’s fast-growing spending, federal funding losses and heightened economic uncertainties under President Donald Trump’s administration.

The deficit could balloon to $35 billion annually in the next few years if state leaders don’t pursue long-term solutions, namely making sustainable revenue increases or cutting spending, according to the Legislative Analyst’s Office, the nonpartisan fiscal adviser to lawmakers.

But neither will be appealing options to Newsom and legislative leaders this year.

They have repeatedly resisted increasing taxes on average Californians and high-income earners alike — a politically dicey pitch to make in a state with high tax rates and increasing revenue. Spending cuts are equally painful to swallow, especially for Democrats running for re-election in November who have fought to expand services, such as Medi-Cal, that may now be rolled back.

For Newsom, a lame-duck governor with presidential aspirations, there is even less incentive to address the state’s long-term budget health through major policy changes, political strategists say.

“It’s not an uncommon occurrence in California for a departing governor to leave a note on the new governor’s desk that they’ve got a budget deficit,” said longtime Democratic consultant Garry South.

But how Newsom tackles the structural deficit will almost certainly have implications for his expected presidential bid. State Republicans, such as Assemblymember David Tangipa of Fresno, are already blaming the budget problem on Newsom’s mismanagement. “A Newsom presidency would be a fiscal and governance disaster of historic proportions,” Tangipa wrote in a December op-ed.

It’s the fourth consecutive year in Newsom’s tenure that the state is projecting a deficit even as revenue grows. In the past, state Democratic leaders resorted to temporary fixes such as internal borrowing, deferring payments, one-time cuts and drawing from California’s rainy day fund to avoid cutting into the social safety net.

But that cushion is deflating: The state’s reserve stands at $14 billion, half its peak balance, after two years of withdrawals. State leaders have borrowed more than $20 billion from other state funds, debts that will come due in later years. Continuing to rely on those options would leave the state “undeniably less prepared” for an economic downturn, the LAO warned.

“Eventually you are going to run out of Band-aids,” said Steve Maviglio, a Democratic strategist who worked for then-Gov. Gray Davis during a massive budget deficit. Newsom "has used every trick in the book, and after a certain point, there’s nothing left.”

More healthcare cuts to come?

Newsom has not indicated whether he’ll consider cuts to Medi-Cal, the state’s primary health insurance program for low-income residents. But as the state’s most expensive program, it is an attractive target. More than half of the $200 billion program’s funding comes from the federal government.

Last year, as Newsom and legislators scrambled to close a $12 billion budget gap, they froze new Medi-Cal enrollment for undocumented immigrants, charged immigrant enrollees a $30 monthly premium and delayed cutting certain benefits. The cost of Medi-Cal has been rising faster than expected, forcing the state Legislature to allocate $6.2 billion midyear to prevent a shortfall.

The decision was contentious, with some healthcare advocates and Democratic lawmakers slamming their leaders for creating a “two-tiered healthcare system” that deemed immigrants less worthy of quality coverage.

“That was an incredibly disappointing backslide,” said Amanda McAllister-Wallner, executive director of Health Access California, which advocates for universal healthcare.

This year, Trump’s budget reduced the federal government’s share of funding to Medi-Cal, requiring the state to pay more to provide the same benefits. California is projected to spend at least $1.3 billion more to implement that change, a figure that could reach $5 billion by fiscal year 2029-30, the LAO estimated.

The Martin Luther King Community Hospital in Los Angeles.

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Assemblymember Mia Bonta, an Oakland Democrat who chairs the Assembly Health Committee, said solving the state’s budget crunch shouldn’t come at the expense of health care.

“California needs its state and federal leaders to look for more innovative solutions to fill the gaps, make healthcare affordable, and keep our families healthy,” she said in a statement that did not offer specific alternatives.

Any cuts to Medi-Cal could bring political consequences for Democrats who often pride themselves on expanding social services. Rolling back Medi-Cal could hurt Newsom’s legacy, too, since it was under him that the state began offering Medi-Cal to immigrants.

“Democrats are the party of expanding healthcare,” Maviglio said. “To slash it goes against everything they stand for.”

McAllister-Wallner acknowledged she isn’t optimistic about the budget outlook. But she said she hopes the state finds new revenue through taxing corporations instead of making cuts to vulnerable populations.

If “we are addressing this through cuts only, and cuts to the most vulnerable, that’s … not the leadership that we are looking for,” she said.

State leaders could also walk back some of last year’s funding commitments in other areas. While state lawmakers negotiated $500 million for homelessness to counties and delayed it until next year, it is not guaranteed. Newsom, who has blamed the state’s homelessness problem on local governments, could withhold the money.

Newsom also promised last year he’d reach a deal with Bay Area transit advocates over state funding. But last month, in light of the budget shortfall, Newsom urged advocates to dip into previously allocated dollars to save the regional transit network, instead of a $750 million loan the advocates had requested.

Taxing the rich a nonstarter for Newsom

It’ll be hard to muster the political will in Sacramento to raise taxes.

Former Assembly Speaker Anthony Rendon, a Los Angeles Democrat running for state superintendent of public instruction, said he’s long supported higher taxes on industries that have “skated away from taxation for a long time.”

But even the most progressive Democrats in California have had little appetite to raise taxes, he said, because many represent affluent areas such as Silicon Valley where their wealthy donors live.

Even when the state faced a projected $56 billion deficit over two years in 2023, Rendon said Democrats were “shrugging” at the problem and pointing to the state’s reserves as a solution, which he said reflected a culture of reliance on the rainy day fund.

This year, Newsom has already spoken out against a proposed labor-backed wealth tax ballot measure, consistent with his past opposition to similar proposals.

The ballot measure, titled “The 2026 Billionaire Tax Act” and filed with the state attorney general’s office in October, seeks to tack a one-time 5% tax on those with a net worth of at least $1 billion and use the money to fund the state’s healthcare and education programs. The effort is led by the SEIU-UHW, a powerful labor union representing healthcare workers, and St. John’s Community Health, one of the largest nonprofit healthcare providers in Los Angeles County.

State. Sen. Roger Niello, a Roseville Republican and vice chair of the Senate Budget Committee, applauded Newsom’s opposition to the proposed tax increase.

“To have a situation where we have developed an increasing deficit in the face of an economy that is not in recession, and revenues are increasing, it would seem to be silly to solve that by further increasing revenue,” he said.

While taxing the rich is a popular Democratic talking point, backing a proposal like that could mean alienating the wealthy donors Newsom will likely rely on for his presidential run.

There would also be no political gain for Newsom in his last year to stabilize the state’s progressive tax structure, which heavily relies on high-income earners, despite him promising to do so when he took office.

“He’s going to make more enemies doing it than he would not doing it,” Maviglio said.

This article was originally published on CalMatters and was republished under the Creative Commons Attribution-NonCommercial-NoDerivatives license.

Some government funding streams for L.A. County’s public health system are drying up, and officials are turning to private philanthropy to fill the gap.

A new privately funded foundation launched Thursday to strengthen public health services after $50 million in federal, state and local funding cuts to the county’s Department of Public Health since early last year.

“It is really a hard day for our community when we have to ask for private donations to fund a public good, but unfortunately, we've lost too much money to not take this important step,” said Public Health Director Barbara Ferrer.

In February, the county’s Public Health Department closed seven clinics, with six remaining open. About half of the patients seen in those clinics are uninsured, according to county officials. The department also cut hundreds of staff positions.

Ferrer is on the board of the new foundation, The Fund for Advancing Public Health LA, which held its first meeting Thursday.

She said the fund will help the county maintain its basic public health infrastructure, including disease prevention, health promotion, environmental health, and emergency response efforts.

Other board members include several health insurance executives, as well as actors Sean Penn and Danny Trejo. Board member Saree Kayne of the R&S Kayne Foundation pledged $150,000 to the fund Thursday. Kayne said she hopes the donation encourages others to give.

The foundation aims to raise $2 million this year.

More cuts expected

L.A. County Supervisor Holly Mitchell said it’s crucial to have an alternative funding stream to protect services for the county's most vulnerable residents.

“We are saving public health,” Mitchell said. “This fund represents a new approach, one that brings together government philanthropy in the private sector to invest in community-based solutions, protect vulnerable populations, and strengthen our public health infrastructure.”

Officials say more public health cuts are coming, through the federal budget law known as the "Big Beautiful Bill," which slashes funding for Medi-Cal.

The county Department of Public Health anticipates losing up to $300 million in revenue over the next three years because of the federal budget bill and other potential funding freezes. Federal funding accounts for almost 50% of the public health budget, according to county officials.

Mitchell also led an effort to put a half-percent county sales tax increase to fund public health on the June ballot.

If approved by voters, that proposal, known as Measure ER, is expected to raise about $1 billion a year for county safety net health services, including about $100 million for the public health department.

Board members

The Fund for Advancing Public Health LA announced its founding board of directors, which includes:

• Dr. Barbara Ferrer, LA County Department of Public Health director
• Debbie I. Chang, Blue Shield of California Foundation CEO
• Sean Penn, actor and co-founder of Community Organized Relief Effort (CORE)
• Martha Santana-Chin, LA Care Health Plan CEO
• Saree Kayne, R&S Kayne Foundation CEO
• Danny Trejo, actor and restaurateur
• Jarrett Barrios, an executive at the American Red Cross
• Dr. Deborah Prothrow-Stith, Charles R. Drew University College of Medicine Dean
• Kristin McCowan, an executive at the Los Angeles Dodgers

The Rose Bowl in Pasadena may be a centenarian, but it’s holding up pretty well as it continues to host events on its way to a starring role in the LA28 Olympics.

But before it can host the soccer final, it needs fixes, especially to the infrastructure serving the bathrooms and drinking fountains. Fears of a toilet backup while in the world’s spotlight led Rep. Laura Friedman to seek federal funds for upgrades. On Thursday she announced she secured just over $1 million.

“Two years from now, athletes around the world are going to compete for gold right where we are standing. This is not the time to find out whether or not these pipes are up to the task,” Friedman said.

The planned work, she added, will lead to improved water flow capacity and water drainage, eliminating the risk of backups and emergency maintenance.

The funds came from the House of Representatives Interior and Environment subcommittee. The fixes, an official said, will be completed by the LA28 Olympics.

The funds, however, are a drop in the bucket when it comes to what’s needed to make needed improvements to the Pasadena venue.

Officials, including (left to right) Rose Bowl Legacy Foundation President Dedan Brozino, Deputy Fire Chief of the City of Pasadena Tim Sell, Congresswoman Laura Friedman, and Rose Bowl Stadium CEO Jens Weiden announced infrastructure funding for the 103-year old Rose Bowl.

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“Over the  next 20 years there's about $200 million that we need to put in and that's everything from updating light fixtures to updating gas, water, wastewater lines, etc.,” said Dedan Brozino,  president of the Rose Bowl Legacy Foundation, the nonprofit that supports the Rose Bowl stadium's preservation and enhancement.

Getting venues ready will be expensive

The money is a much-needed win at a time when elected officials in city, county, state and federal offices have been struggling to find the funds to get L.A.-area venues ready for the global Olympic stage in two years.

The entrance to a men's bathroom at the Rose Bowl.

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A $360 million proposal to spruce up asphalt in parking lots around Exposition Park won’t be done in time for the Olympics, as originally planned. Meanwhile, just up the street, there’s concern that a $2.6 billion expansion of the L.A. Convention Center, which is hosting Olympic wrestling, fencing and judo in 2028 won’t be ready for the Olympics.

Additionally, to save money, LA28 organizers moved Olympic diving to the Rose Bowl complex last year because it has two Olympic-sized pools, while the Exposition Park complex doesn't and would need expensive upgrades.

Topline:

About the chick: The chick hatched March 14. The zoo opened its Cape vulture enclosure in February 2025 after years of planning to encourage the birds to roost and nest, welcoming a new breeding pair that year. When it grows to be an adult, it’ll have a wingspan of 8 1/2 feet.

About the enclosure: The L.A. Zoo said it spent years developing the vulture habitat, which was designed to mimic the vultures’ natural environment in South Africa and nearby countries. Dominick Dorsa II, the zoo’s director of animal care, said in a statement the successful hatching is “a testament to the design and construction” of the habitat.

How to see the chick: You can’t for the time being. Zoo officials are keeping it away from visitors until the chick matures, though you can still see adult Cape vultures at the zoo’s enclosure.

Though visitors will have to wait until the chick matures to see it in the enclosure, you can still take in the impressive eight and a half foot wingspan of the adult Cape vultures.

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What zoo officials are saying: “Welcoming a Cape vulture chick is a thrilling moment for our team and a beacon of hope for African vultures,” the L.A. Zoo’s curator of birds Rose Legato said in a statement. “Vultures are one of nature's most misunderstood marvels, and I cannot wait for our guests to eventually watch this chick grow and learn just how vital they are to our ecosystems.”

About the species: Cape vultures are listed as a vulnerable species due to human activities and encroachment. According to the L.A. Zoo, African vultures are more closely related to eagles and hawks than vultures native to the Americas, like the zoo's California condors that hatched last year.

This story first appeared on The LA Local.

What should have been a celebration for formerly incarcerated youth completing a reentry program at the Boyle Heights Arts Conservatory (BHAC) last week instead ended with seven students and two staff members detained by the Los Angeles Police Department, according to witnesses. 

Now, nearly a week later, BHAC staff and city officials are demanding answers from the LAPD, with some accusing officers of racial profiling. 

According to the LAPD, officers observed a large group gathered on the corner of Cesar E. Chavez Avenue and Mott Street around 4:16 p.m. on March 26. Authorities then requested backup for what they described as “a large group surrounding officers,” LAPD Public Information Officer Tony Im said. 

The group, classified by police as an “aggressive gang group,” consisted of seven 18-year-old students from the BHAC’s Bridge Academy Movement (BAM) program and two BHAC staff members.

The BAM program pays formerly incarcerated youth to complete 200-250 hours in media and visual arts training to prepare them for creative careers. That day, students were set to showcase their work at the BAM program graduation for families and community members. 

Rene Weber, a teaching artist at the BHAC, had been with the students setting up for the ceremony minutes before the incident occurred. 

According to Weber, the students had gone to coffee across the street at Milpa Kitchen as they often did, when staff were alerted that they were being detained. 

Weber said he arrived to find students and a staff member pressed against the wall in handcuffs. 

Video from the scene, taken by a staff member at the BHAC, shows multiple officers surrounding the group. At one point, an officer orders a person to “get on the wall” and displays a stun gun.  

“No, none of that, these are kids right here,” the staff member replies.

Another staff member, Teotl Veliz, recorded a large police response.  

“I counted 12 cop cars, that’s at least 25 cops, and they had a helicopter,” Veliz said. “It was just so comedic, tragically comedic, that it was on their graduation day too.”

Officers established a perimeter with yellow tape along the side of Ashley’s Beauty Salon as local business owners and witnesses gathered around the students. 

“I was just incredibly disappointed in LAPD… because it became so apparent to everybody, all at the same time, that it was racial profiling and nothing else,” Veliz said.

Weber said officers gave shifting explanations for the stop at the scene, including blocking the sidewalk and possible underage vaping. After Weber told the officers that all of the students were 18, they said they would investigate whether the group had any gang affiliation. 

Police have not responded to questions about what led officers to believe that the group was gang-affiliated. 

Weber recalled pleading with the officers to let the group go and explaining to them that they worked across the street. Community members and local business owners also stepped in to vouch for the students. 

“Our job is to help them gain a new perspective on life,” Weber said. “They’re coming out of juvenile detention and they’re turning their lives around. We can do our part in keeping them off the streets and keeping them doing better but what does it mean if they’re going to be profiled and treated exactly the same way?” 

In total, seven 18-year-old students and two staff members were detained. BHAC staff said one student and one staff member were taken to Hollenbeck Community Police Station and released less than two hours later after advocacy from community members and Councilmember Ysabel Jurado.

The incident ultimately resulted in an infraction for smoking a cannabis e-vape on a public sidewalk, according to a photo of the infraction shared with the Beat. LAPD did not provide details about the people taken to Hollenbeck Station or the infraction. 

The graduation ceremony was cancelled that night and is expected to be rescheduled in April. 

“Graduation should be a moment of pride and possibility — not fear,” Jurado said in a statement. “I’m seeking answers about what occurred, and this underscores the need for stronger relationships between law enforcement and community organizations so moments like these are protected, not disrupted.”

Carmelita Ramirez‑Sanchez, the conservatory’s executive director, said she was grateful to the community and Jurado for advocating for the students’ release. Jurado met her at Hollenbeck Station within 20 minutes of being alerted to the incident, she said. 

“They had store owners, señoras, barbers, that ran out and were trying to explain to the police who our kids were,” Ramirez‑Sanchez said. 

Still, she said the incident tarnished what should have been a joyous celebration.

“I imagine that what this does is derail this entire idea that you can be an active participant in your own restorative growth,” she said.