12/23/2024

Gov. Gavin Newsom embraces an untested idea on how California’s rainy-day fund should work

Then, in his budget proposal last week, new Gov. Gavin Newsom asked lawmakers to set in motion plans to add even more to the fund — a total of $4.1 billion more over the next four years.

To those who would suggest that that’s more than Proposition 2 says the account can hold, Newsom pointed to a legal opinion — little talked about until now — that argues there are no real rules governing extra or “voluntary transfers” of tax revenue.

That would mean not only no rules on how much extra money can be put in, but no rules on how it must be spent.

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