Newsom’s 2023-24 budget takes major steps in child care, supplemental security income
Governor Gavin Newsom’s 2023-24 proposed budget includes $230.5 billion for all California Health and Human Services (CalHHS) programs. While a primary focus of the budget for CalHHS is on Medi-Cal, the state plans to invest in several other key areas, including child care, supplemental security income (SSI) and opioid.
The proposed budget maintains over $2 billion annually to expand subsidized child care slot availability by over 200,000 after the state reached a historic agreement with Child Care Providers United – California to collectively bargain reimbursement rate increases.
The budget also projects a 2.9% increase to CalWORKs Maximum Aid Payment levels, with an estimated cost of $87 million for 2023-24. CalWORKs is a public assistance program that provides cash aid services to eligible families that have children in the home. The program serves all 58 counties and is operated locally by county welfare departments. The increased costs are funded entirely by the Child Poverty and Family Supplemental Support Subaccount of the 1991 Local Revenue Fund, and will be updated in the May Revision of the budget. The 2.9% increase is in addition to an 11% statutory increase for 2022-23.
Further investments into youth and children include funding for California’s child welfare system, which provides a continuum of services to children who are at risk or who have suffered abuse or neglect. The 2023-24 proposed budget includes $884.9 million from the general fund for services to children and their families in these programs.
Early Edge California, which serves as a voice for the needs of families and early learning teachers, championed Newsom for protecting early learning investments amidst a multi-billion dollar budget shortfall.
Early Edge welcomed the new funding, which will get the state closer to universal Transitional Kindergarten (TK) to all four-year-olds by the 2025-26 school year, by receiving $690 million for the second year of TK expansion. The expansion will increase access to the program to all children turning five years old between September 2nd and April 2nd.
The TK expansion is expected to be completed in 2025, and $165 million would ensure TK classrooms have smaller student-to-adult ratios of 12:1. According to Early Edge, once the expansion is completed, California will have the largest, free preschool program in the country that will serve about 400,000 children.
“Governor Newsom continues to be a champion for families and children in his budget plans for this upcoming year. We are pleased to see that the goal to reach universal TK in 2025-26 is still on track,” Executive Director Patricia Lozano said. “We are grateful for the Governor’s caution in navigating California through budgetary uncertainties, while continuing to prioritize our state’s youngest learners, as well as the adults who support them.”
While the proposed budget delays preschool inclusion grants for two years from 2022-23 to 2023-24, the budget maintains the implementation of an annual $10 million grant fund from the general fund to support preschool inclusion efforts, such as facility modifications or staff training. The budget maintains the grant program beginning in 2024-25.
The proposed budget for CalHHS also consists of increased cash assistance to individuals living with disabilities and older adults in the Supplemental Security Income (SSI) and State Supplementary Payment (SSP) program, and low-income children and families in the CalWORKs program. SSI is a federal program that provides monthly cash benefits to those who meet the program’s income and resource requirements.
In California, SSI payments are augmented with an SSP grant, and assists recipients with meeting basic needs and living expenses. The SSI/SSP program is administered by the Federal Social Security Administration, which makes eligibility determinations, computes grants, and issues combined monthly checks to recipients.
The budget includes $3.4 billion in general funds for the SSI/SSP program, including the state’s Cash Assistance Program for Immigrants (CAPI), which provides monthly cash benefits to aged, blind, and disabled individuals who are ineligible for SSI/SSP solely due to immigration status. CAPI benefits are equivalent to SSI/SSP benefits. The average monthly caseload for the program is estimated to be 1.1 million recipients in the 2023-24 year. An 8.1% federal SSI cost-of-living adjustment, and a 10.3% SSP increase took effect on January 1st. The maximum SSI/SSP grant levels were brought to $1,134 per month for individuals, and $1,928 per month for couples.
To strengthen and expand the state’s health and human services workforce, the budget maintains over $1 billion of general funds to the Department of Health Care Access and Information (HCAI). These investments include funding for increasing nurses, community health workers and social workers, and supports new individuals coming into the behavioral health, primary care, and reproductive health workforces. This commitment will occur over a longer period of time than expected, according to Newsom, due to the declining general fund revenues.
Another major proposed investment aligns with the evolving opioid epidemic, as California experiences rising rates of opioid use, addiction, and overdose deaths. Building on the 2022 Budget Act opioid response investments, which consisted of a one-time opioid settlements fund amount of $39.1 million, the budget includes an additional $93 million in opioid settlement funds over four years, beginning in 2023-24. The funds would support youth and focus on investments in fentanyl for DHCS and the Department of Public Health.
Under the opioid and fentanyl response, $79 million would go towards the Naloxone Distribution Project to increase distribution to first responders, law enforcement, community-based organizations, and county agencies. The fentanyl program grants would also receive $10 million to increase local efforts in education, testing, recovery, and support services. Another $4 million would support innovative approaches to make fentanyl test strips and naloxone hydrochloride more widely available. The budget also includes $3.5 million of ongoing Proposition 98 general funds to provide all middle and high school sites with at least two doses of naloxone, or another medication to reverse opioid overdoses on campuses.
The administration anticipates receiving additional funds from new settlements with opioid retailers, and once funds are secured, the administration will update the spending plan for settlement funds in the May budget revision, with a focus on opioid overdose medication distribution.
In the coming months, the administration will continue working with the federal government to leverage more resources. Appropriations subcommittees will review the budget by category, and the legislature must pass its own package prior to the governor signing it.