The Governor’s 2026-27 State Budget Proposal Scheduled for Release on Jan. 9

CSAC has a finger on the pulse of political and governmental activity in Sacramento and cuts through the noise to deliver the trends, insights, and key developments necessary to keep counties well-informed. Here’s what you need to know about the hustle and bustle at the State Capitol this week:   

Release of the Governor’s 2026-27 State Budget proposal planned for Jan. 9: Where to watch and access state budget information  

During Governor Newsom’s State of the State address this morning, he previewed major themes of his proposed state budget for the 2026-27 fiscal year. One of several topline “teasers” included in his speech notable for county governments is the announcement that state General Fund revenues are now projected to be more than $40 billion higher than previously forecasted by the Administration. This is a marked shift from the updated revenue estimate from the Legislative Analyst’s Office (LAO), which projected an $11 billion increase in revenues across three fiscal years in their Fiscal Outlook (November 2025). While the magnitude of this change is significant, an increasingly upward revision of revenue projections is not entirely unexpected given the most recent monthly cash report from the State Controller’s Office and other economic indicators. This notwithstanding, the LAO still anticipated that the Administration and the Legislature would have to contend with a double-digit deficit during the budget development process. You can read more about California’s fiscal condition here and CSAC’s response to the State of the State address here.  

Tomorrow morning at approximately 10:00am, the Director of the California Department of Finance will fill in all of the details during his presentation of the Governor’s proposal for the 2026-27 state budget at a press conference, which can be viewed live on the Governor’s YouTube channel. You can also view the Department of Finance’s summary of the Governor’s 2026-27 January budget proposal and other fiscal details on their website once it is publicized on Friday.   

Continuing our annual tradition, CSAC will publish a comprehensive overview and analysis of the Governor’s budget proposal and highlight the notable impacts to county governments via our Budget Action Bulletin, which will be published on the CSAC State Budget webpage.  

Next steps for the state budget development process 

In the coming weeks, CSAC will submit letters to the Governor’s Administration, legislative leadership, and budget committee chairs in both houses offering comments to inform budget conversations throughout the spring and summer.  

Concurrently, budget committees in the Assembly and Senate will hold hearings to review the Governor’s budget proposals and craft the legislative vehicles that will eventually become the 2026 Budget Act. Most budget committee work is done through subcommittees that focus on specific policy areas. A list of subcommittees by policy area and their hearing schedules are available on the Senate and Assembly budget committee websites.  

Budget negotiations will begin in earnest later this spring, particularly after the Governor releases his May Revision budget proposal in mid-May, with the tight constitutional deadline for the Legislature to pass the budget bill(s) a scant month later, by June 15. 

How to engage with CSAC’s budget advocacy 

As county leaders, this is the moment to make our collective voices heard on the issues that matter most to our communities, ensuring our feedback is considered during budget deliberations. Individual counties can engage with CSAC’s budget advocacy efforts by: 

• Sending a letter from your county to the Chairs of the Senate and Assembly budget committees. Submitting letters directly to budget committees and meeting with their legislative members to ensure the voices of their communities are heard in addressing their unique needs.  
• Contact your lawmakers to share the county perspective and how the proposed state budget for 2026-27 will affect your county: Senate Roster | Assembly Roster. 

CSAC will continue to publish comprehensive updates on the state budget development process in our weekly bulletin. In the interim, please contact CSAC legislative affairs staff with questions about specific policy areas.