2020 California Legislative Preview

The California Legislature reconvened its two-year session on January 6, and lawmakers have been tasked with passing a budget despite a slowdown in state tax revenue. Gov. Gavin Newsom’s priorities include lifting families from homelessness and poverty, expanding educational opportunities from pre-school to college, and closing the gap on universal health care.

Here are several of the top issues that California lawmakers will likely address during the 2020 legislative session:

Health Care

New state law requires Californians to have health insurance in 2020 or face a penalty on their state taxes. In response, the state is exploring initiatives including universal health care coverage, expanding Medi-Cal to all low-income adults regardless of immigration status, increasing tax credits to the working poor, and boosting subsidies to middle-income Californians to buy health coverage. Lawmakers will address rising drug prices and they will consider Gov. Newsome’s proposal for the state to manufacture its own generic drug label.

California’s aging population is projected to grow to 8.6 million by 2030, and the governor issued an executive order calling for the creation of a Master Plan for Aging. The plan, which acts as a blueprint for state government entities to build environments that promote an age-friendly state, takes effect this year. Several bills have been filed to protect the state’s aging population on a variety of issues including health and long-term care costs, and lawmakers will discuss Gov. Newsom’s $80.5 million budget proposal to extend the state’s Medicaid benefits to undocumented income-eligible seniors.

Gov. Newsome proposed a new vaping tax, $2 for every 40 milligrams of nicotine, and lawmakers will discuss the tax and further restrictions on the sale and advertisement of vaping products, potentially including all flavors, an action that would go further than the federal ban on certain flavors.

Sports Betting 

A U.S. Supreme Court decision legalized sports betting but California has not yet legalized the practice in the state, potentially leaving millions of dollars of tax revenue on the table. In response, lawmakers may propose legislation to add sports betting legalization to the November, where it would require majority approval from voters.

Environment

Gov. Newsom has signed a number of recycling and plastic reduction bills into law, but further restrictions may be introduced to reduce transportation emissions and implement clean fuel standards.

Enormous wildfires continue to displace millions of residents in California, and wildfire prevention and response funding will be considered, including more investments in new equipment and increased staffing for CalFire.

Marijuana

Though California legalized the sale of cannabis in 2017, most of the cannabis market remains illicit. The industry continues to be the subject of debate and lawmakers will likely introduce legislation related to providing banking, easing taxes, and cracking down on sales to minors. Additional federal market regulations may also pose a challenge to California’s cannabis industry.

Education

The state budget includes $80.7 billion in public school funding, including $3.15 billion for long-term relief for school districts facing rising pension costs. A bill regarding student financial need, including improving access to Cal Grants, will return this session.

Social Infrastructure

In response to Gov. Newsom’s anti-poverty priorities, the Legislature budgeted $2 billion for initiatives relating to housing loss and homelessness, including grants to build and maintain emergency shelters, funding for wrap-around care, and increasing the state’s affordable housing financing fund.

Budget

California’s budget continues to be in a good position with a $7 billion surplus projected this year. Lawmakers will discuss allocating the surplus toward building reserves and paying down debt, including the retirement liability for state workers and teachers and pension payments.