Gov. Gavin Newsom revealed his plans to resolve California’s “budget problem” May 14 with the release of his revised proposal, which includes underfunding Proposition 98.

The governor projected a $12 billion shortfall for the state. The May revision updates Prop. 98 funding levels for TK-14 schools to $98.5 billion (2023-24); $118.9 billion (2024-25); and $114.6 billion (2025-26), representing a $4.6 billion decrease over the three-year budget window.

Newsom proposed funding the cost-of-living adjustment at 2.3 percent, which applies to most categorical programs with the exception of State Preschool. The budget revision also proposes a $1.8 billion Local Control Funding Formula deferral to July 2026.

The cuts result from economic uncertainty due to federal policies, Newsom said during his press conference. He said his administration will maintain key programs such as Universal Transitional Kindergarten. He proposed doubling the minimum Expanded Learning Opportunities Program grant from $50,000 to $100,000, and the Universal School Meals program remains fully funded at $90.7 million.

“We are going to continue our unprecedented investments,” Newsom said.

ACSA’s Senior Director of Governmental Relations Iván Carrillo said on Legislative Lunch Break that the underfunding of Prop. 98 is concerning for both ACSA’s legislative advocates and its membership.

“We know there are immediate needs our schools have. That was our top priority during our Legislative Action Days,” Carrillo said. “This is unprecedented and it’s troubling to us ... the budget framework comes with a high level of risk.”

He said that ACSA appreciates many of the proposed investments in educational programs and emphasized the need to be “strategic” when it comes to budget asks.

“Some of what we like is built upon this as well,” Carrillo said. “(But) when you pull back in one area, it has impacts on other areas of the education side of the budget.”

ACSA advocates will continue working with Newsom and the state Legislature to negotiate the budget up until the June 15 statutory deadline.