Update: Newsom Projects $21.4B California Surplus

SACRAMENTO, Calif. (AP) – California Gov. Gavin Newsom is projecting a $21.4 billion surplus, the largest since at least 2000. That’s about $6 billion more than the non-partisan legislative analyst predicted in November. Newsom says most of the money comes from his projected smaller increase in spending on Medi-Cal, the state’s health care program for low-income residents. He also says tax revenues are better than what was projected under the prior budget. Newsom’s rosier surplus gives him more money to pay down pensions and invest in higher education and housing. Newsom will work with the Legislature over the next six months to finalize the budget. Surpluses often change between the governor’s January budget presentation and the final budget due in June.

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