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 gov