California Gov. Newsom introduces 2024-2025 state budget proposal

California Gov. Gavin Newsom introduced the 2024-2025 state budget proposal, totaling $291 billion. The budget features an investment of $19.6 billion in transportation funding and closes a projected $37.86 billion shortfall. 

“Thanks to the record reserves we have built up and a commitment to fiscal discipline over the years, our state is in a strong position to close this shortfall while protecting key priorities and programs that millions of Californians rely on. This balanced budget plan keeps California on firm economic footing while continuing our work to tackle homelessness, keep communities safe, expand access to high-quality education, overhaul behavioral health care and fight climate change. I look forward to partnering with the Legislature to meet this moment with a balanced approach that meets the needs of Californians and safeguards our state’s future.” said Gov. Newsom.  

The proposed budget includes $5.1 billion in funding to support transit activities, including $1.1 billion for the state’s Zero Emission Transit Capital Program and $1.24 billion for State Transit Assistance. Additional highlights of the transit and rail funding proposed in the budget include: 

• $7.7 billion for high-priority transit and rail infrastructure projects that will improve rail and transit connectivity between state and local/regional services that are designed to reduce traffic congestion and greenhouse gas production. 
• $4.2 billion Proposition 1A for the High-Speed Rail Authority to continue building the 119-mile Central Valley Segment from Madera to just north of Bakersfield. 
• $350 million for grade separation projects that support critical safety improvements and expedite the movement of traffic and rail by separating the vehicle roadway from the rail tracks.  

However, to support closing of the significant budget gap facing the state, the budget proposal includes a delay of $3.1 billion from transit and intercity rail programs to align with expenditure schedules. The proposed delay includes: 

• $2.1 billion from 2021-22 to as late as 2027-28 for the competitive Transit and Intercity Rail Capital Program 
• $1 billion from 2024-2025 to 2025-2026 for the formula Transit and Intercity Rail Capital Program 

Additionally, the budget proposes a reduction in active transportation funding by $200 million and delaying $400 million from 2021-2022 to align with expenditure schedules.  

California Transit Association applauded the proposal for “recognizing the importance of public transportation to everyday Californians and the role our agencies play in expanding access to jobs and opportunity, improving air quality and combatting climate change.”  

“In the face of a $37.9 billion funding shortfall, Governor Newsom’s budget proposal introduced today upholds the state’s commitment to provide $5.1 billion in critical funding to California transit agencies necessary to avoid devastating service cuts and advance major transportation and rail capital projects that benefit transit-reliant communities, riders, workers and families across our state,” said California Transit Association Executive Director Michael Pimentel. “This funding not only keeps California moving, but will significantly help advance the state’s landmark environmental, public health and equity goals. As the budget process proceeds, we look forward to engaging the Newsom Administration and the legislature on the details of the governor’s budget proposal, with the goal of ensuring that the final mechanics and timeline for appropriating these funds meet the varied needs of regions and agencies across the state.