Since the coronavirus force millions of businesses to close their doors and shrink their workforces. However, the number of first drizzle. Time applications has now friday morning we sought out the day with some clouds and declined for six straight weeks, suggesting that a then becoming partly sunny into dwindling number of companies the afternoon hours. A lot more sunshine compared to are reducing their payrolls. Meanwhile here in our states, the last few days. And then into friday evening we there are 1. 2 million will gradually thicken of the cloud cover. Our next system coming on board californians collecting in the pacific, this is saturday, 5 00 p. M. Unemployment insurance, chances of rain, a better bet including most of the staff at by saturday, 9 00 p. M. The brown sugar kitchen in oakland. The owner had to let 34 of her and some scattered rain showers into sunday morning. Workers go when restaurants were ordered to shut down back in march. Usually, anyone receiving jobless benefits much the lots of clouds, lots of actively looking for work and scattered showers across the must accept any job offer. Bay area sunday morning and but the state has just released then it looks like hold off on a new set of guidelines that now allow some people to turn that shower chants into monday. With this pattern setting up, down some jobs. If you have a Health Condition that puts you in a that could destabilize things high risk group, that is considered a legitimate reason. Some people now are making enough that we could have a few thunderstorms by that time frame. Once again, that would be more from unemployment than in sunday into monday. Highs this afternoon, lots of some jobs that are still open. 60s and lower 70s for warm spots. The chance of some scattered showers or missed or drizzle. Tomorrow is warm. Lots of 70s out there. Right now we are waiting for increasing clouds saturday. Governor newsom to give his daily updates. The governor scheduled to reveal his revised budget now off and on showers and it looks that theres an estimated 54 billion spending deficits, the like that chants could continue budget expected to include a 10 pay cut for all state into monday. Keep the umbrella nearby in the next few days. Thank you, mark. Workers. Back in january, the governor the School District and the and build a 222 billion city of oakland have launched a spending plan that included a nearly 6 alien dollarhave multimillion dollar effort to close the digital divide. Dropped and unemployment just this morning the city and payments have skyrocketed this School District along with the Oakland Public Education Fund will be the first time newsom, as governor, has had to deal and Tech Exchange announced their plan to help students and families. They launched a campaign to with the budget deficit. Raise 12 1 2 Million Dollars to state lawmakers have to approve supply a computer and internet the budget by june 15th. Access to every oakland student we will bring you that News Conference live as soon as it gets underway. The number of coronavirus cases in need. Here in california continues to spivak we know they will never grow. The latest numbers show 73,000 get this time back as students. We have got to equip every child with the tools, the connectivity, and the support to be lifelong learners and to be digitally literate. People tested positive across the state. There are now close to 3000 people who have died right here in the bay area. There are more than 10,000 cases with 374 deaths. Four people were killed in an overnight crash in san jose. This happened in the southbound half of the Public School students in oakland dont have access to the internet and its even more important now to be connected because schools, of lanes around 10 30 last night. Course, are doing distance according to the chp, speed and learning due to the covid19 pandemic. Governor newsom still alcohol played a role in this answering questions from crash. The suv was carrying six people reporters right now. We are strumming that for you on our website at ktvu. Com. And traveling at a high rate of speed when the driver lost thats it for us at noon. Our next newscast is coming ups control, causing the vehicle to flip several times. Officers arrested the driver on suspicion of dui. A coronavirus researcher shot in more california counties have been given the green light a love triangle. To start reopening up their economies by diving deeper into guard killed for telling a customer to wear a phase two. 17 counties have been given the mask. Hit a father of nine in okay to open more quickly than the rest of the state. It includes reopening sitdown restaurants and some instore shopping. It does not include any the back of the head. Counties right here in the bay area. S coming up next. Most are Rural Counties in the sierra. We list on our website for you at ktvu. Com. Governors across the state doubling down on testing and contact tracing. We are going to sacramento right now, Governor Newsom [siren] logic. Clearly the time had an expectation that this was serious, but none of us had a sense of how serious. The focus appropriate at the time was Public Health. As you can see from this slide, not only is the state of california impacted by what is to come, but the entire nation and of course the worlds economy. You can see here in this chart, u. S. Recession thats been induced because of covid19, 26. 5 decrease just in the spring in the nations output, just like that. Almost the blink of an eye, and fiscal terms, certainly a blink of the eye. 60, 70, 80 days later in a completely different position. Not just the state of california, but the entire nation. The good news, though, for those that watch and follow the work that has been done here in this capital, work done by the previous administration, governor brown, the outstanding leadership that he advanced in terms of fiscal stewardship of the state over the last two terms combined with the talents and similar stewardship by legislative leaders, we enter into this moment in a much better place than we have previously entered into any recessionary moment. I say that soberly, not nacvely. I dont say that triumphantly. We are going to be dealing with challenges that we havent faced in sometimes. But it is important to know, when we talked in terms of the surplus that we were debating last year, that operating surplus was in the range of 21 1 2 billion dollars. That was last years operating surplus that we were responsible for balancing. We debated that surplus and we did a lot of things that i think, i hope make this situation a little bit better today. We paid down debt in the final 4. 5 billion of debt from that wall of debts, the infamous wall of debt here in the state of california. At the time, and told 34. 7 billion. The final payment was done last year, 4. 5 billion, completely eliminating that debt. We were thoughtful, perhaps more so than even the last decade and a half of using those surplus dollars very prudently. Even more so than in prior years where 88 of those one time surplus dollars went to pay down one time obligations or to invest in just one fiscal years investment. Meaning they try to reduce the amount of ongoing expenditures. That is the 12 reflected in this slide of new ongoing commitments. In budget terms, that is fiscally conservative approach that we entered into last year, including, by the way, making commitments to paydown long term obligations, pension obligations. Not just paying off that wall of debts. That allowed us to increase our reserves to a record 16. 2 billion. That is just one of a number of reserve accounts in the state, and i will talk about not only that reserve account, or talk about another number of accounts where we are able to put aside money not just in that Rainy Day Fund, but social Safety Net Fund that we had set aside, some 524 million that was set aside in our budget under prop 98 provisions for Public Education system, including some Economic Uncertainty dollars that were set aside. A longwinded way of saying this, we were just asserting physical discipline, we were proving it. So much so that our vibrating increased twice last year and was increased the highest level in over two decades. As a consequence of that, growing costs for the state of california declined. Its a long way, again, of saying we are entering into this time ofs uncertainty in much better place than we entered into it in, for example, 2003. For that matter, 2009 or in more contemporary terms, 2011. We are in a position where i can advanced, at least a commitment to you. The numbers have certainly changed, our values remain. And we are committed despite the headwinds of a 54. 3 billion budget shortfall that we are interested to balance in the current fiscal year and into the next budget year. To advance not only an effort to balance the budget, but also to balance our principles and to advance our values. Those core values, those core principles, i think, are real reflected in this light using next to me. Public education, Public Health, Public Safety, and always an eye on people that have been hit hardest by covid 19. I am not nacve by any stretch of the imagination. As painful as the states budget may be, personal budgets for so many of you watching are even more devastating. You have exhausted your savings, your credit has been completely destroyed, you are desperate to get a sense of not only your fate, but our collective future. Some 4. 6 million of you have filed for unemployment claims just since we are at a time that is simply unprecedented. When i mean unprecedented, we talk in terms of that great recession. That great recession, we had unemployment that peaked at 12. 3 in the Third Quarter in 2010. Some 2. 2 Million People were out of work. I will go back to what i just said, 4. 6 million californians just since march 12 have filed for Unemployment Insurance claims or assistance under our pua program. 2. 2, the peak in 2010. Now, 4. 6 million filing claims so far just since march. We are projecting in our documents we are putting out today in our main revise of that january budget unemployment will peak north of 24 1 2 . One could argue we are already there. We are projecting, though, that as of peak. The budget year we are projecting that we will come in roughly at about 18 unemployment number. This is simply without presidese unemployment numbers, ecbeing felt statistically, but they havent been felt like this since the great depression. These are not normal numbers, even in a state so familiar with bag reduce of revenue increases and declines because the volatility of our tax system. These are simply without precedent in modern times. So, the economic consequence is real, and thats why i just want folks to know that we are very mindful that while this may be in academic exercise of balancing estate budget, this translates very differently to the folks watching that are trying simply to pay the bills, to keep their lights on, to be able to figure out some semblance of optimism about their capacity, get back to work, and, once again, provide for their family and their future. Dreams quite literally being torn asunder in real time. Lives continuing to be lost, including 98 human beings that lost their lives in the last 24 hours related to covid19. These competing and confounding and compounding factors are front and center in terms of our consciousness and in terms of our mindset as we move forward to balance this years budget. Let me now talk about this years budget in more specific terms. The current Budget Proposal may revised putting out reflects a decline of 22. 3 in revenue from the january budget. Billion Dollar General oday is fund. Some 203. 3 billion overall budget. The general fund reflects and 9. 3 decrease from the budget act of 2019. The overall budget about 5. 4 decrease from the 2019 act. Back go ahead, mike. We are not able to make the kinds of purchases there once were, only essential people obviously tightening nue projections in terms of decline in sales tax revenue is 27. 2 . We are projecting personal income tax, the pit as its referred to in budget language, to decline by 25. 5 . Corporate tax by 22. 7 . All told in those three main categories, revenue decline over 22. 3 . And so, we start there. That is the baseline, no longer projected surplus north of 6 billion, but now a projected deficit for the current fiscal year and the budget year that we are announcing in advance here today of 54. 3 billion. Let me explain why we believe its 54. 3 billion. We cleaned up the 2018 and 2019 budget year. Not surprising, that showed up as a million. I dont want to lose too many of you on this, but i do just want to quickly some of the foundational challenge that we have. We had some good news there, but in the current fiscal year, obviously some bad news. 9. 7 billion reduction in our projected deficit. Into the next fiscal year we are projecting 32. 2 billion budget shortfall. Roughly 41. 2 billion is the projected deficit. That assumes no increased caseload, no increase cost and expenses to help the most vulnerable californians. One cannot assume that. It is the consequence we added roughly 13 billion to that total. 13. 1 billion to be exact, thus the total budget projected budget for the budget year and 54. 3 billion. So, that is the magnitude of what we are called upon to address. You may say, well, thats the biggest budget deficit weve ever heard in californias history. In a remarkable way, it is not. The economic consequences, the personal and professional consequences, those unemployment numbers certainly are, but the budget numbers are not in this respect. Not only do we come in with more physical health than we had in the past into this recession with more ample reserves and more capacity for deferrals, the abilriate under these circumstances, but also we come in with a substantially larger general fund than we have seen in the past, just to put it in statistical terms, this is cold comfort for those watching, roughly 45 was the budget shortfall in 2003. 58 in 2009. 58 in 2009. You may recall the 2009 budget deficit came in at roughly 60 billion shortfall. 2011 it was about 30. 8 . 31 of the challenge. This year we project roughly 37 . So, this is challenging. This certainly will be a multi [ inaudible ] i say that because i want to begin there. We are not arguing to solve a 54. 3 billion shortfall overnight. We are looking not only [ inaudible ] having some audio problems again from Governor Newsom as he outlines the path forward for california. Saying yes, we are in a 14 in year two, we want to bring down an additional 5. 4 billion. In year three, 2. 9 billion. So, we are committing in the documents we are putting out here today to use all of the 16. 2 billion in the rainy day reserve, but do it over a three year period. Because no matter what we do this year, it wont be enough to address the shortfall next year, and we have to be mindful of our responsibilityto balance the budget every year, but do so strategically. Remember, no Printing Press here in the state of california. We are constitutionally [ inaudible ] its a responsibility to submit and to approve a balanced budget. And that is our requirement through the next number of weeks. It has to be done by july 1st of this year. But again, we are looking at a multiyear strategy, and that strategy will include pulling down that rainy day reserve in a sequential way. 7. 8, 5. 4, 2. 9 billion. I mentioned just a moment ago the rainy day reserve is one of a number of reserve accounts in the state of california, the other reserve account was created a few years ago by the outstanding leadership of our budget chair in the senate, Holly Mitchell. It was her brainchild to put together a safety net reserve, and thankfully she did that with her colleagues, with leadership in the assembly and the senate and the support of our administration, and the previous administration. That reserve account has 900 million in it. We proposed to the legislator that we use 450 million in this budget year and an additional 450 billion in the subsequent budget year. Like the rainy day reserve, we draw down over three years. The safety net reserve we draw down over two years. So, there you have 7. 8 rainy day reserve, 450 million in the safety net reserve. Finally, there was a reserve that was little noticed, but certainly highly debated that was probably never even imagined that we ever see triggered in our lifetime under the prop 98 guarantee. And that is the guarantee that supports that k through 19 Education System. That reserve went into effect a couple of years ago. We started putting money in the reserve. Last year we had 524 million in that reserve. Thankfully, we are going to pull all 524 million of that surplus into paid on this deficit and help support our Education System this year. You have those three reserve accounts roughly all totaling 8. 8 billion. So, that is 8. 8 billion on our way to solving a 54. 3 billion problem. That is nice, thats roughly 16 or so percent of the solution. The obvious question is, what else are we going to do . We clearly have been blessed by the incredible leadership of Speaker Nancy Pelosi and the strong bipartisan support of our congressional delegation and democrat Republican Leaders across this country. The cares act will provide us an additional 15 of relief in terms of ultimately balancing our budget. 16 relief from reserves, 15 relief from the cares act. In january, i stood up here and i promoted a number of important programs, things that i think overwhelmingly for supported, certainly appeared once again to be embraced by the legislator, focused on expanding our preschool for all programs and investment and further expanding healthcare to those that are currently without coverage. Series of specific proposals that we made in january. The overwhelming majority of those proposals we are now going back. Those are enhancements to the baseline budget. The vast majority, not all, but the vast majority were pulling back. That represents an equivalent 15 of the solution. Reserves, 18 . Federal government, 15 . The pulling back of these new programs that we were hoping to invest in in january provides us an additional 15 . There are three additional categories now that ultimately get us to a balanced budget. Number one area that just a year and a half or so ago that i highlighted was some of the borrowing from special funds and some of the deferrals into new fiscal years that were done in the past, and i made an oblique comment. I said, im looking forward to ending these things and the first budget i submitted upon becoming governor. I also did that and made a side comment. I said, play the tape because its not unlikely that i will be forced by conditions to come back and utilize some of those examples in the future. I never imagined to be back year later under these extraordinary circumstances, but the ability, because we cleaned all of that up, because we had fixed all of that, because we had tightened our belts and are better positioned to go in here, that opportunity affords us about 19 and solutions in this budget. So, we are going to use a little bit of that. We think its very strategic and very prudent under the circumstances because the magnitude of the problem that occurred and manifested so quickly. You have got the 16 in the reserves, 15 pulling back investments from january 15th percent from the federal government, 19 in terms of some of these deferrals and strategies to balance our books in a way that is well known and well described in the past here in the state of california. Afforded because we had cleaned a lot of that up in the past. That leaves us with two areas that were traditionally are defined in terms of balancing budgets. That is, how do you find some revenue and how do you define what is appropriate to cut . Nothing breaks my heart more than making budget cut. We have been making historic investments in the last many years in the state of california, and now being forced back into this position where we are having to make cuts breaks my heart. Because one thing i know about cuts, there is a human being behind every single number. Behind every category is a dream that is either deferred, and some case a dream that is denied. Im sober about it, im not nacve about cuts. 26 of our solutions. And i want to make this crysta clear over the course of the last many many weeks. That is, these are cuts that can be triggered and eliminated with the stroke of a pen. President of the united states, with the stroke of a pen could provide support for speaker pelosis new heroes act, and these cuts would be eliminated. These cuts would be triggered and the language in our budget directly triggers the elimination of these cuts. Its in the control section of the budget act. The reason i use that, and technical terms, i want you to know thats not rhetorical we are quite literally writing it into the budget act and the controlling section that if the federal government does what it must do under the circumstances to help states, large and small all across this nation, that these cuts would go away. When i list off, we are going to have keel team go appear in their going to go through all the details for you as is our responsibility and youre right to know, you will hear of cuts that make none of us proud, but the values nonetheless we are holding onto, i think and hope will. Im going to get to those in a minute as points that that also is not just rhetorical flair. 26 are in the category where the federal government provides the support and relief for states, cities, and counties that those cuts will not go into effect. The final point back is about an 8 solution on net operating losses and tax credits that we want to tighten up. Thats on the revenue side. To with those percentages reflect in budget dollars, that is your 54. 3 billion of scaffolding and architecture around this budget. Let me go back. I talked to you about values. Talk to you about what we are protecting. I want now to make that visible, make that real. Not just again rhetorical. When we talk in terms of values, as i said, numbers change, values dont have to. Values remain. Values i ran on to become your governor, values we overwhelmingly hold dear because regardless of our political stripes. Values that we hold dear precious on the investment in the future. You want to look in the eye of a child to see the reflection of our capacity as a society. Its always reflected in the eyes of young children. Right now those eyes are reflecting back, a 19 billion impact to proposition 98 in the Education Sector and in this budget. 19 billion. I want you to know that we are not just going to roll over and accept 19 million of cuts to Public Education let me be specific and tell you what i mean. We are going to use some 4. 4 billion from the cares act to allow for real discretion in real time and put that money rather than in the general fund, we are going to put in Public Education. 4. 4 billion, to address the issue of learning loss. To address the social emotional challenges that our kids are facing. The trauma and stress their families are facing because of not only lost school time, challenges with Distance Learning, but the anxiety induced this morning to help with Summer School and to help with the flexibility that the districts are going to need to consider on their own on a district i district basis of what they feel is best for them to address the learning loss. That includes possibly extending the school year, bringing that School Year Later into the summer and the like. These will be discretionary money to address some of the shortterm anxiety. Thats 4. 4 billion. Additionally, we had made commitments, top of this. We are going to use one of those payments that was scheduled to pay down the pension obligations. The immediate needs i think require this of all of us. We are going to use 2. 3 billion that was scheduled to be invested for over 30 years. To pay down pensions to address Education System. 4. 4 and another 2. 3 billion. I mentioned at operating losses, i mentioned tax credits. About 1. 8 billion of that 4. 5 billion revenue that would be generated would go into that 98 count, also reducing the stress. Theres an additional 1. 6 billion that comes independent of the state contribution in terms of the cares act that goes directly to k through 14. That money, 1. 6 billion, obviously also goes to reduce the size of that 19 billion shortfall. You start adding this up, now we are north of 10 billion. 10. 1 billion in terms of quicker solutions. Two other things we are committed to do. Deferrals are also in this category which we believe can help alleviate some of the stress related to this system. The reserves that exist within the School Districts and theres this very important point. We are committing 1. 4 of our general fund. I know this can be very technical and im going to lose 90 of the people. 99 of you watching at home. We have something called a maintenance factor. Its a lot of complexities about how proposition 98 was advanced to protect Public Education funding, and we are obvious to those concerns. As a consequence, we are committing as a recommendation to the legislator, all of this as a recommendation to the legislator. We are committing to taking 1. 5 of the general fund, averaging about 2 billion a year going up to 4. 6 billion a year to do a supplemental payment under prop 98 so that the cuts and by the way, the 19. 2 billion and utilizes at about 13 billion. You can ask me a question on that, i dont want to confuse you. With the Additional Support in knowing that commitment will be made, not just advanced of a minimum roughly 2 billion a year, it will communicate very quick really and should that these cuts are not permanent and as a consequence make decisionmaking with that mindset, a lot easier, more flexibility in that space. When we talk about values in education, we mean it. Again, im not nacve. There is a cut. Im not going to touch the categoricals or supplementals. We have an equity lens in terms of our approach and other value we hold dear. The lc ff cuts at 10 clearly are going to be a challenge, and we look forward to working with our district, and weve already been working closely with superintendent of Public Education who has been on my desk but our teams desk and laura hamlet is been working hard on these proposals as well. I just want to congratulate and thank them for all their hard work and i recognize that work is just beginning now that the clarity in terms of the may revise is coming into clearer picture. Let me just make one final point mac on education and move on to two additional items and then answer questions and we will have the detail presentation about my finance team. I care deeply about financial education. I cannot in good conscience be part of dismantling that commitment we had made well over a year ago to substantially improve special education in the state of california. Nothing breaks my heart more than seeing people physical and emotional disabilities, people so often left behind and forgotten, falling even further behind. We are not even close to where we need to be in terms of protecting those folks and as a consequence we are going to annualize that 645 million commitment for special Needs Children and not cut that in this budget under prop 98. Forgive me for that expression. Personal expression, not just a professional one. It is a point of pride and privilege that at least in this may revise that im not going to make that case that that budget be dismantled. That said, we wanted to enhance it even further this year. That will not be denied, but unfortunately because of the budget, may certainly looked to be delayed. As it relates to Public Health, one thing we are not going to delay is our commitment to your health. We talk in terms of dollars and cents, budget is about dollars and cents. Makes sense to some, maybe less to others. We also have to talk in terms of life and death. We have been talking in terms of life and death as the first state to do the state in order to take seriously this pandemic, to flatten that curve so it never increased. We believe we have saved lives. We believe we protected the Public Health for the people of state of california and we are proud in the state to have done more in terms of expanding healthcare to those without it and deepening subsidies for those with it into the middle class in any state in this country. And we are not going to back away from that progress. We wanted to make more progress with the january budget. Unfortunately, that progress will be delayed, but the foundational eligibility and the foundational base programs will not be cut. Let me be specific. We made great progress last year to deepen subsidies for the middle class. People earning 4 to 600 of federal poverty. Thats families earning up to 50 million. No state in america provided deeper subsidies, any subsidies frankly. Most provided none. These kinds of subsidies into the middle class. We are not going to walk away from that program, nor are we going to dismantle the support and eligibility and expansions that we had already put into place. However, there are areas where we clearly cant do what we wanted to do. Keeley will talk a little bit about that with prop 56 which may not mean a lot to those watching. Made a lot more to those that understand the reimbursement side of things and some other programs that clearly were just not in a position to do. Those, again, can be triggered immediately back with the support of the federal government. Dont think for a second im not going to keep coming back to that, including before i end this presentation. Foundational he as it relates to Public Health, we are going to keep the system intact. I say that not nacvely. There are areas we are going to have to defer and there are areas we will de there are areas that are part of that 26 in cuts, but terms of those we have already put into place, we are going to hold the line. The subsequent expansions we unfortunately are not in a position to do at this moment. That is Public Health. Public safety, yesterday i laid out in very detailed and prescriptive terms the commitment we have to Public Safety of the states. Remember Public Safety for us is broadly defined. Certainly it is police and fire, Public Safety defined clearly by our Corrections System and our reentry programs and the like. Yesterday we tried to break down the concerns that many have and expressed privately many privately they where walking right back into wildfire season. What are we going to do to address wildfires . We are trying to put out the fire and spread of coronavirus. We, i think, made clear to all of you that we are now walking back from our responsibility to keep you safe, to do many things at once, not just two things at once. You saw that there will be enhancements in terms of the number of cal fire personnel. We still dont have the people and the equipment we need in this state with the hots getting so much hotter and the dries getting so much drier to address Climate Change and address the reality of wildfire management. We are doing a historic amount of Education Management prescribed burns, we talked about that yesterday. The last one will be done in seven days just off highway 17. We are continuing to do our part. The utilities including pg e including to do their part. The work they are doing is creating this only division on wildfire safety and the commitment on this budget to get that division up. Were not going to delay that, its too important. Build that division to hold our utilities accountable, pg e included to make sure they are keeping you safe power shutoffs, the ps ps. We put out all of that yesterday. It is appointment that we are emphasizing here today, Public Safety includes protecting people from wildfires and know that we have now a more robust capacity to do it than even a year ago, still a lot of work to do in this space. Closing, we talk about people, people being hit the hardest by covid19. And i just want to again make this point mac. I talk in terms of the state budget where people obviously are dealing with different challenges as it relates to their own personal finances. The reality at the end of the day is, we need to do more to help individuals that are struggling and in need. We talked about Unemployment Insurance, 4. 6 Million People that tragically have found it necessary to have Unemployment Insurance. Forgive me, those numbers reflect a substantial increase versus what weve seen in the past that require of us a responsibility to meet the needs, not just in the short run, but the long run. That is why in this budget is desire to bring down some 43. 8 billion to continue to provide Unemployment Insurance and pua assurance. That is assistance for people that are selfemployed in the gig economy. I want folks to know we are not walking away from our commitments there and our desire to continue to do more in that space, recognizing that this is a multiyear responsibility. And so, we are looking to architect our solutions over a multiyear period in making sure that the sure you have the resources you deserve, particularly as it relates to working families. People who are able to go back to work but are struggling. Putting 1 billion in the pockets of working families, working poor, people struggling to get into the middle class. I believe its incumbent upon us from a moral and ethical, but also an economic paradigm to continue to support that program without any cuts we also, that by the way provides up to 1000 for individuals with children under the age of six. We are committing to doubling down on the cost. Accordingly, we want folks to know that we are not going to touch the grant enhancements. We worked hard with again senate leaders, Assembly Leaders to increase cal grant supports. We increased the cal to cut tha base in this budget, at least im not proposing to. I hope the assembly could curse. We are going to protect people, protect the Unemployment Insurance program, protect the calworks program, protect the ability to do more on the itc. We want to advance those in a public way and remind people we are not going to touch the Cal Grant Program either. We did enhancements for mothers, fathers with kids that wanted to go back to school. There was some conversation about pulling back that program. I just feel like thats exactly the kind of program we need at not just budgetary with our broader needs. Let me sum up here quickly. Also recognize this, you cant have a conversation about budget deficits and you can have a conversation about sacrifice unless you lead by example, and i want folks to know that none of us in State Government will be immune from tightening our belts and committing to help the cause and help support those most in need. So, we are asking across the board for 10 contribution in wages. We will be negotiating and bargaining with each bargaining unit in the state of california. I know this is the last thing that our partners want to hear, but unfortunately we are in a position where its required of all of us. By the way, including me and including my entire staff. We are looking for additional 5 deficiencies in sectors of government across the board. One thing about this pandemic is that it has opened our eyes to possibilities that we may never have seen, even three or four months ago. We talk about work many of you are doing from home and the telework, how the boomers generation is now experiencing the zoomer generation. How we are engaging differently than we ever have conducting business, exchanging commerce differently than we ever have in the past. Government is operating accordingly. Just thinking of the dmv. Just the dmv alone. 97 of the transactions are virtual now at the dmv. Conversations for years and years now with the zen buddhist beginners mind used her to think anew about how we can advance those reforms and do things a little bit differently. You still need the field offices, but we can do a lot of the work very differently than we have in the past. We also can do with without as many cars, not as many cell phones, without as much in our travel budget. Conventions, all of that. We are going to tighten our belts across the board. You deserve a leaner government that is more nimble, more effective, and targets the needs of the most vulnerable, and we are committed in this process to giving you that and finding solutions and new strategies to conduct our business and ultimately to advance our collective calls. Just make a point with higher education, not just k12 education, the ability to utilize distancelearning and to utilize online resources very differently than people even imagined, again, just a few months ago. These prevent themselves this opportunities and also challenges, because change is difficult and i we are committed to advancing that change. We are committed to being more efficient and more effective as we move through this as well. Across the spectrum, we are trying to meet this moment as so many of you are compelled to meet this moment in your private lives. We are committed to advancing our values and we recognize these cuts are devastating to so many people. None of us are nacve about the challenges in front of us and i just want to extend appointment of personal privilege and appreciation to the legislator. They are back in session. We have a very short period of time to make difficult decisions, Work Together in a collaborative spirit. I want them to know, i want you to know if my commitments to them. Again, not to be an ideologue, interested in different approaches, different strategies, the senate just came out with a number of very interesting proposals and i want to thank them for their ingenuity, for their willingness to communicate those, not just privately, but publicly. I want folks to know we are not infallible. We do not have exclusivity on the path. That is part of the dialectic, part of the conversation, back and forth. I am pleased the legislator is back in section. Im grateful for the leaders, the assembly, and the senate. Ive been inconsistent Constant Contact with both of them throughout this pandemic. I could not be more humbled and more grateful for their leadership and stewardship, not only their caucus, but in terms of counseling us to get to this point mac. We are going to need their strong ownership moving forward. The budget chair, Holly Mitchell thanked them for their guidance and counsel. The broader caucuses, republican, not just democratic caucuses. Let me think them in advance for their contribution to this process. Again, very short period of time. Enormous amount at stake. A multiyear approach and well get through this. We will get through it stronger, more nimble, more capable, more resilient than ever. We are not in a permanent state. We are in a state of constant reimagination, and i could not be more proud to be governor of a state that prides itself on reinventing itself and reimagining the future. Not just reimagining the future, manifesting a Brighter Future one what we are not just growing, but one where we are growing together. In that spirit of growth and inclusion and health, we submit this budget, and we do so final words with recognition that the enormity of task at hand cannot just be born by estate. The federal government has a moral and ethical and economic obligation to help support the states. After all, what is the point mac of government if not to protect people, their safety, and the wellbeing of the citizens . This is an opportunity to make real our purpose and advance our values. It is not just the state of california and its governor that is making an announcement along these lines. Its governors all across this country. The federal government, we need you. These cuts can be negated. He can be dismissed with your support. This is your moment. I want to think again incredible leadership of nancy pelosi and i encourage my republican friends, those in the other aisle and the senate to help support the states. Help support the cities. Help support counties. Help support america and americans. The hero act is the best is neg i am not nacve about that, but the opportunity to move forward and to make real the values at a federal level will help us make real invisible values here in the state and local level. You want to protect firefighters, support that effort. You want to protect our Police Officers and sheriffs . Protect them by supporting the efforts. You want to protect our nurses and doctors . Protect them by supporting those efforts at the federal level. You wanted to protect our kids and our teachers . Our teachers . Lets support what nancy pelosi is doing. Lets support that federal appropriation. If we do, that will soften the blow and give us a pathway to get back on our feet much quicker and help grow, and once again support the economy as we have supported the recovery of this nation more than any other state over the last decade. Thank you. Now im happy to take any questions. Hi, governor. Public Health Officials on the front line of this pandemic say despite the deficit, its imperative to invest millions more in ongoing Public Health funding for counties across california. They are asking specifically for 150 million ongoing money and it looks like your budget has a small fraction of that, about 4. 8 million. Theres big concern that without a greater investment the state will be ill prepared not only in the coming months, but for the next disaster, the next crisis that the state cant anticipate. Are you open to that conversation . What do you say to those concerns . Federal Government Support the heroes act. Nancy pelosi has put out a pathway, a strategy to illion t states to help support with is to have 1 trillion cities and counties that substantially answer that question very specifically. State of california, as large as we are, nations fit this fifth largest economy, simply cannot do all that is needed at this moment. We need the federal government. We need the federal support. Working together, i am confident we can get that support and that will substantially address that concern. Question, governor. Governor newsom saying an enormous amount is at stake. Indeed, there is. Lives are at stake right now during this pandemic. Jobs are at take, ducation is at stake, homes are at stake. 53. 3 billion budget hole. That is with the state faces right now. But, hey, no one wants to walk through this door of that. But as the governor said, the state in a much better position as it was prepared for this with those extra reserve accounts. 16 billion in the Rainy Day Fund that will be split up over three years, not all at once. Second reserve accounts, the safety reserve accounts with 900 million. A third account with a half billion dollars that we put toward schools. The governor has lots of pots of money here that he is moving around so that massive cuts do not happen when it comes to education. The governor it meeting that there is going to be a problem with learning loss for students out there as we move forward into the summer months and fal months. These students need their lunch meals. The students need computers. If we continue Distance Learning in the future, that is up to the districts. Teachers need to stay because its all hands on deck. We need the teachers here. The governor is definitely moving a lot of things here, but announcing he is proposing a 10 pay cut to all state employees. That is going to have to be negotiated with unions, but he said it all goes away with the federal government stamps and with Nancy Pelosis heroes act and that would bring trillions of dollars into the state of california. Thats right. If we have been listening to the president s comments about the funding, house Speaker Nancy Pelosi has been asking for, it is anything but definite that congress will push it through, that the president will approve it. Have the governor looking to of things, and that is the individual californian who works for the state. We heard the governor referred to a 10 contribution by all state workers. Not directly saying a 10 pay cut, but of course we all know what that is. We talk about teachers and the incredible work they are doing and try to do as we look ahead to what the Upcoming School year might look like. The governor said that even though the numbers have changed, our values of state the same. Public education number one on that list of four key priorities for california and for californians. Public education, Public Health, Public Safety, and people hit hardest by the coronavirus pandemic. All of this happening as there have been some 4. 6 million californians filing for Unemployment Insurance in just the past two months. The latest numbers we have showed that theres 14. 7 percent unemployment in our state. The governor said it could go as high as 22, 23, 24 . We are streaming it for you live at ktvu. Com. If you would like to continue to watch that, we will have more for you later on in our afternoon and evening newscasts. Right now we have to take a peek outside because weather is a big concern when it comes to fire danger. We are happy to say, theres a little bit of help coming our way. Thats right. This time of year could be hot and dry. In fact we are tracking lots of clouds. Some missed and drizzle. Things are really adding up. Take a look atu, as