General Legislative Update in Light of COVID-19

Overview

The State Capitol is closed due to shelter-in-place orders and legislative work continues to develop at a slow pace. The Governor and legislative leadership are beginning to narrow policy priorities and focus more on the state budget and mitigating COVID-19 impacts. While the COVID-19 crisis will have a significant negative impact on the state’s finances, the state currently has roughly $19.2 billion in reserves. The Chair of the Assembly Budget Committee confirmed that the state will adopt a budget to meet the June 15 constitutional deadline; however, the Chair stated that the June budget would include no new spending that was not related to the state’s response to COVID-19, wildfire prevention and homelessness.

Timeline

As expected, it was announced earlier this month that due to continued health concerns, the legislature shutdown will continue until May 4, extended from the originally announced April 13. Both house leaders have hinted at remote voting options but are concerned with constitutional limitations. It is likely that the legislative summer recess and other legislative deadlines will be impacted, but it is not yet known to what extent.

Scope of Work

Given the truncated timeline and growing policy concerns related to COVID-19, it is becoming increasingly clear that not all bills will progress this year. The Speaker of the Assembly, Anthony Rendon, stated to expect 600-700 bills to be heard this year versus the 3,000 bills that originally were introduced. Several policy committees have contacted authors of legislation pending in their committees to urge them to reevaluate their bill priorities, but as of this date not all committees have weighed in.

Budget

The Governor has said this year’s budget is “no longer operable” due to the strains COVID-19 have had on the state’s healthcare and unemployment programs. Assembly Budget Committee Chair Phil Ting announced there will be two budgets. One “bare bones” budget will be basically the current year budget that includes funds or adjustments necessary to meet immediate COVID-19 related needs, wildfire prevention and homelessness. Depending on preliminary revenue projections the current year budget also may have to be trimmed. This budget must be passed by June 15 in order to meet the Legislature’s statutory deadline to submit a budget to the Governor. Because tax collections have been extended to July 15, and the Legislature is not able to meet this spring, a second state budget in August will be necessary. By that time the state will have a better sense of how much money there is to spend, and a more normal deliberative budget process can be followed that includes input from all stakeholders.