Newsom blames California’s $12 billion budget shortfall on tariffs, Medi-Cal spending on immigrants

When Gov. Gavin Newsom introduced his fiscal year 2025-2026 budget in January, he said California’s finances were improving.

Now, the state is staring down a nearly $12 billion budget shortfall, largely because of market volatility driven by President Donald Trump’s oft-changing tariffs, Newsom said during a news conference Wednesday outlining the annual May revision of the budget proposal.

Plus, the cost of Medi-Cal, the state’s health program for low-income and disabled residents, has ballooned.