California GOP lawmakers urge Newsom to call a special session to address the deficit

The California Legislature is due to reconvene in just under three weeks. That’s not soon enough for Assembly Republicans, who are urging Gov. Gavin Newsom to call a special session to tackle the state’s projected $68 billion deficit.

Assembly Republican Leader James Gallagher, R-Yuba City, and Assembly Budget Commitee Vice-Chair Vince Fong, R-Kern County made the pitch in a letter Thursday, two days after Newsom imposed a spending freeze in anticipation of the massive shortfall.

“The Administration’s initial step to freeze spending is not enough. The budget hole is simply too massive. The Legislature must come back to take action to implement the cuts. The Legislative Analyst’s Office reports revenues to be $26 billion below 2022-23 revenue estimates, and anticipates collections to be $58 billion below Budget Act projections across 2022-23 to 2024-25,” the letter reads in part.

The lawmakers said the situation is complicated by the fact that almost half of the estimated deficit is for a fiscal year that is already over.

“Urgent action now is necessary to roll back one-time and limited-term spending programs in the current year. Californians cannot risk more financial uncertainty, so immediate action now will help maximize the effect of current year solutions, and hopefully avoid the need for more difficult solutions later,” the letter goes on to say.

Newsom spokeswoman Erin Mellon said in a statement that the governor “has maintained strict fiscal responsibility since taking office,” including by building up the state’s reserves to historic levels and paying down debts.

“Federal delays in tax collection forced California to pass a budget based on projections instead of actual tax receipts. Now that we have a clearer picture of the state’s finances, we must now solve what would have been last year’s problem in this year’s budget,” Mellon said.

State lawmakers have said that “everything is on the table right now” to determine how to address the projected deficit, including the possibility of declaring a fiscal emergency, giving the Legislature access to $24 billion in general purpose reserves.

In a recent interview, Newsom said that the budget deficit will be “smaller than has been advertised,” though he did not disclose how much smaller in that interview.

Newsom is set to deliver a proposed 2024-25 budget by Jan. 10, 2024.

“In January, the Governor will introduce a balanced budget proposal that addresses our challenges, protects vital services and public safety, and brings increased focus on how the state’s investments are being implemented, while ensuring accountability and judicious use of taxpayer money,” Mellon said.

This story was originally published December 14, 2023 at 12:26 PM.