Newsom, top Democrats bargaining over child care raises as California budget deadline nears

As the start of a new budget year approaches next week, Gov. Gavin Newsom and state lawmakers have been hashing out details of a budget agreement.

The two sides are largely aligned on how to spend a multi-billion-dollar surplus, but need to reconcile details of an expansion of health care to more undocumented immigrants and a raise in rates for child care providers, among other issues.

To enact a budget in time for the July 1 start of the upcoming fiscal year, lawmakers need to have the text of the main budget legislation done by Sunday. They will then continue to hash out remaining details, likely for weeks into the summer.

Negotiations over a raise in pay rates for child care providers who are paid by the state to provide child care for low-income families have emerged as one of the main remaining issues.

At a rally Thursday at the Capitol where the providers’ union urged Newsom to agree to raise their pay, both Assembly Speaker Anthony Rendon and Senate President Pro Tem Toni Atkins said they sided with the providers and were negotiating to ensure the budget includes the increase they are seeking.

The union says some of its members make less than minimum wage after expenses, an unsustainable problem. Miren Algorri, a child care provider in San Diego, said 5,000 providers have closed in the last year, and that thousands more could follow if the state doesn’t increase their pay.

“Without a significant increase in rates, more and more providers will close and California’s recovery will stall as parents have no place to leave their children,” she said during the rally outside the Capitol. “How can the state expect providers to keep their businesses open and make ends meet on less than minimum wage?”

In their budget plan, lawmakers provided funding for the rate increase the providers are seeking. But Newsom hasn’t agreed to it in his own proposals.

Newsom’s $268 billion budget plan also differs from lawmakers’ over how much to expand health care for undocumented people. Newsom proposed expanding eligibility for the state’s Medi-Cal program to undocumented people over age 60. Lawmakers’ proposal would drop that threshold to 50.

At the same time, lawmakers and Newsom have been negotiating an extension to the state’s eviction moratorium, which is set to expire June 30. Newsom has said he wants an extension, as have the chairs of the Legislature’s housing committees, who say letting the moratorium to expire could force thousands from their homes before they have a chance to access federal funds to pay back-rent.

The Bee Capitol Bureau’s Hannah Wiley and Kim Bojorquez contributed to this report.

This story was originally published June 24, 2021 at 5:17 PM.