Gov. Gavin Newsom's state budget proposal for 2026 includes a $350 billion plan that includes little new spending but also avoids major cuts. Newsom is eager to safeguard programs that have defined his tenure as the leader of the nation’s most populous state and one of the world’s largest economies. The proposal also includes a $5 billion education grant for teacher training and $100 million to help Los Angeles-area homeowners rebuild after the devastating wildfires last year.
Gov. Gavin Newsom speaks about his state budget proposal Thursday, May 14, 2026, in Sacramento, Calif. The proposal includes little new spending but also avoids major cuts.
Newsom is eager to safeguard programs that have defined his tenure as the leader of the nation’s most populous state and one of the world’s largest economies. As he gears up for a possible presidential run in 2028, Newsom is promoting the budget as fiscally responsible because it protects California’s progressive programs while also builds up the state’s rainy day funds. The state’s spending has grown more than $100 billion since 2020, according to the legislative budget analysts.
Newsom can’t seek a third term and will leave office in January. Revenues, driven mostly by the booming stock market and artificial intelligence industry, are $16.5 billion higher than projections in January, according to Newsom’s office. The budget proposal will officially kick off the final stretch of negotiations between Newsom and Democrats in the Legislature, who have to pass a spending plan by the end of June. Newsom used his presentation to blast President Donald Trump and his policies.
The May budget proposal will also include a $5 billion education grant for teacher training and $100 million to help Los Angeles-area homeowners rebuild after the devastating wildfires last year
California Budget Programs Fiscally Responsible Progressive Artificial Intelligence Industry Booming Stock Market Teacher Training Wildfires President Donald Trump Federal Funding Cuts High Costs Gas Energy Tax Credits Taxes On Corporations Fees For New Small Businesses Small Businesses Premiums Healthcare Program Adult Patients Without Legal Status Initial Public Offerings AI Companies Ipos Loss Of Government-Sponsored Health Subsidies Budget Deficits Budget Holes California Legislature Final Stretch Of Negotiations Spending Plan End Of June Tax Credits That Could Generate $850 Million A Fees For New Small Businesses Fees For New Small Businesses Fees For New Small Businesses Fees For New Small Businesses Fees For New Small Businesses
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