Governor Gavin Newsom released his 2026–27 budget proposal, presenting modest near-term revenue growth amid continued economic uncertainty and volatility. The proposed $348.9 billion General Fund budget includes a $14.4 billion Rainy Day Fund, of which $4.1 billion is designated for TK-12 public schools. He also announced $125.5 billion for TK-14 education and a 2.41% cost-of-living adjustment (COLA), with ongoing commitments to fully implement Universal Transitional Kindergarten, school meals, and the Expanded Learning Opportunities Program. Governor Newsom continued to caution that uncertainties from wildfires and potential federal actions could lead to significant adjustments in the May Revision. As a result, the Governor’s January budget attempts to build stronger reserves and budget tools to better manage revenue swings.
