LAO Publishes 2021-22 Preliminary Spending Plan Overview

This week, the Legislative Analyst’s Office (LAO) published its annual California Spending Plan to summarize the year’s state budget. The LAO on Tuesday published the overview of the 2021-22 Budget Act and highlights major features of the budget approved by the Legislature and signed by Governor Gavin Newsom. The report published by the LAO is a preliminary version and reflects actions taken through July 15, 2021.

In its report, the LAO details the status of the state’s General Fund, use of COVID-19-related federal funds received by California, the evolution of the state’s budget, and early budget actions taken by the Legislature and Governor. The LAO summarizes the major features of the 2021-22 Spending Plan by subject area and indicates a series of forthcoming publications this fall will provide greater detail on state investments.

In the health space, the LAO indicates the 2021-22 State Budget provides a total of $3.8 billion in new, discretionary General Fund monies for the fiscal year, $1 billion of which is ongoing, for health-related programs. Notably, California is investing $664 million General Fund ($1.1 billion total funds) for the first half-year of implementation of the California Advancing and Innovating Medi-Cal (CalAIM) initiative, as well as $94 million General Fund ($158 million total funds) for three major expansions to the Medi-Cal program (older undocumented adults, pregnant and postpartum persons, and the Medi-Cal “asset limit” disregard).

The LAO in its report includes the $300 million General Fund augmentation to the California Department of Public Health (CDPH) to improve state and local public health systems beginning in FY 2022-23. Recall, the Legislature and Governor ultimately ended up agreeing to the minimum $300 million amount in final negotiations on the state’s budget package for the fiscal year. Notably, the LAO points out that the average annual General Fund budget for CDPH has been approximately $175 million since CDPH became a standalone department in 2007-08.

The LAO summarizes other investments in housing and homelessness, human services, and education, among other topics. The full preliminary overview of the state’s spending plan is available here.