SACRAMENTO – Today, the California State Senate passed the three-party agreement on the 2026-27 budget. The agreement comes after weeks of negotiations between the Senate, the Assembly, and the Governor’s Office. California remains committed to protecting all of our communities and to ensuring our budget is balanced, allowing the state to continue funding critical programs. The budget bills will now head to the desk of Governor Newsom for a final signature.

“This budget meets the moment. It balances the budget over the next two years, cuts the state's structural deficit in half, and maintains approximately $36 billion in reserves to help California navigate continued economic uncertainty and the fiscal challenges at the federal level.

In a year that required difficult choices, the Senate proposed a framework that -- similar to the final budget -- remained focused on protecting the services Californians rely on. We delayed proposed Medi-Cal reductions, protected In-Home Supportive Services for seniors and people with disabilities, invested in financially distressed and public hospitals, and preserved access to health care for millions of Californians. We also maintained funding to address homelessness, continued California's commitment to cleaner air in underserved communities through AB 617, and expanded access to affordable child care and universal preschool. We also continued our commitment to strong civic institutions by funding California's journalism fellowship program. As local newsrooms continue to contract, these fellowships will help develop the workforce needed to sustain high-quality local journalism.

We made responsible decisions that protect Californians today while putting the state's finances on a stronger footing for the years ahead."

Senator John Laird, Chair of the Senate Budget and Fiscal Review Committee 

The final budget includes several priorities for the Senate, including: 

• Investments to add 22,770 new childcare spaces in 2026-27 – bringing the state closer to reaching 206,800 additional childcare spaces. 
• Maintains core funding for In-Home Supportive Services by rejecting all proposed cuts to the program.
• Continues providing funding for the Victims of Crime Act (VOCA) program to maintain support for crime victims.
•  Safeguards programs like HHAP, CalFood, and immigration legal aid services.
• Supports K-12 education by settling up Proposition 98. 
• Laying the foundation for the Fair Share from Big Corporation program to reduce the taxpayer subsidies for big corporations with employees enrolled in taxpayer-funded Medi-Cal instead of company-provided health plans. This program is expected to generate billions for healthcare.

“The Senate began this budget process by introducing a foundation that would not only address the long-term deficit but also mitigate the devastating cuts by the federal government. The bill signed today does both. I am proud of the work accomplished in the Legislature to make sure California continues to protect healthcare, working families, and affordability.”

“The Senate began this budget process by introducing a foundation that would not only address the long-term deficit, but also mitigate the devastating cuts by the federal government. The bill signed today does both. I am proud of the work accomplished in the Legislature to make sure California continues to protect healthcare, working families, and affordability. 

Senate President pro Tempore Monique Limón

WHAT YOUR SENATORS ARE SAYING

Senator Sasha Renée Pérez, Chair of the Senate Budget Subcommittee No. 1 on Education: “The finalized state budget provides record-level Prop 98 funding to support our students’ success. It includes funding for universal school meals so children will be prepared to learn, continued funding for the Middle Class Scholarship, and critical expansion of funding to support new immigrant students. This budget also provides paid pregnancy leave for K-14 school employees. The Senate worked closely with our colleagues in the Assembly and with Governor Newsom to deliver this responsible, balanced spending plan that maintains large fiscal reserves while supporting the wide range of critical services Californians rely upon.”

Senator Eloise Gómez Reyes, Chair of the Senate Budget Subcommittee No. 2 on Resources, Environmental Protection and Energy: "As someone who has spent my life in the Inland Empire, I know that environmental investments are about far more than protecting our natural resources - They're about the air our children breathe, the health of our communities, and the quality of life we leave to future generations. Those same principles guided our work throughout this budget process and has resulted in a final budget that invests in the building blocks of healthy communities. I’m proud to support it, and I look forward to completing our work when the Legislature reconvenes later this summer.”

Senator Caroline Menjivar, Chair of the Senate Budget Subcommittee No. 3 on Health and Human Services: “In a year when Californians faced unprecedented threats to the programs they depend on most, I am proud the Final Budget pushes back against proposals that would have devastated critical health and human services for everyday Californians. I’m especially thrilled to have voted to create what would establish the first in the State ability to have corporations pay their fair share. Should the framework be implemented next year, we’ll finally be able to shift the tax burden from Californians to corporations in covering Medi-Cal costs. From filling the gaps that H.R. 1 has left in health care, securing 22,770 new childcare slots, and delivering relief to families struggling to put food on the table, we held the line.”

Senator Melissa Hurtado, Chair of the Senate Budget Subcommittee No. 4 on State Administration and General Government: “Families across California are working hard to make every dollar stretch. Government should be held to that same standard and demonstrate that it’s spending existing resources wisely. Those principles guided our work in Senate Budget Subcommittee No. 4 throughout this process. We focused on five priorities: making California more affordable, strengthening fiscal integrity, modernizing procurement and contract accountability, investing in cybersecurity and critical infrastructure, and ensuring public investments deliver real, measurable results. I’m proud those priorities are reflected throughout this year’s budget, from stronger procurement oversight and investments in cybersecurity and public safety to greater government accountability, consumer protection, food security, affordable housing, and other strategic investments that better serve Californians. I am incredibly proud of what we accomplished and grateful for the leadership of President Pro Tempore Monique Limón and Budget Chair Senator John Laird throughout this process. Together, we advanced a budget that protects taxpayer dollars, invests in our communities, and lays a fiscally responsible foundation for California’s future.”

Senator Laura Richardson, Chair of the Senate Budget Subcommittee No. 5 on Corrections, Public Safety, Judiciary, Labor, and Transportation: “As chair of Senate Budget and Fiscal Review Subcommittee 5 on Corrections, Public Safety, Judiciary, Labor, and Transportation, I can say that this budget is a success for all Californians. Today’s budget provides critical funding for programs, such as the Clean California Coordinators to reduce litter on our highways and homeless encampment coordinators to provide outreach services to remove encampments along freeways. It also includes funding for the public and distressed hospitals to keep emergency rooms open. Lastly, the budget provides funding to support additional judges and courthouses statewide so cases can be heard in a timely manner because justice delayed is justice denied.”