In a reduced climate budget, Newsom pivots to flood response and cuts drought

California Gov. Gavin Newsom proposed an increase to state spending on flood threats after a record-breaking winter, while retaining previously proposed budget cuts to his climate and environment budget.

The governor’s budget update delivered Friday included $290 million in new funding for flood protection, of which $125 million was pulled from emergency drought response. Another $165 million was earmarked for flood control, business relief and floodplain restoration in the San Joaquin Valley.

“Here’s the new commitment: Flood protection,” Newsom said in a press conference. “We have a posture of drought to flood, reinforcing this weather whiplash.”

Friday’s proposal is part of a $306.5 billion budget that California must manage under the weight of a growing shortfall. Newsom said in January that state faced an estimated $22.5 billion gap after years of surpluses. That deficit increased to $31.5 billion in May. The Legislature must pass a budget by June 15. Newsom must sign it by July 1.

The state’s proposed $48 billion budget for climate measures this year was pruned in January from $54 billion over five years for its many water, energy, electric vehicles, transportation and wildfire programs.

The $6 billion cut, which slashed EV and residential solar programs, drew outcry from environmental advocates. They warn that the state could lose momentum as it tries decarbonize the economy and stave off the worst impacts of climate change.

Newsom said he hopes to offset some of these reductions with federal funds and a climate resilience bond reserve.

In addition, Newsom said that a key to the success of climate and energy projects will be an overhaul of the state’s permitting system. He said that next week he would preview a legislative package that could cut project timelines by up to three years.

“The world we invented, it’s now competing against us,” Newsom said. “We’re never going to advance our transition to clean energy in time to address our climate goals unless we are able to build these damn projects.”

Flood response measures

After three of the driest years on record, Californians were reminded of their state’s propensity for flooding during periods of high rainfall and rapid snowmelt. It’s that reality, coupled with years of advocacy, that brought the issue to the forefront.

“We’re really glad that the administration has taken it to heart, especially to protect people in the San Joaquin Valley,” Julie Rentner, president of River Partners, an organization that collaborates with flood management engineers to restore river ecosystems.

In addition to the budget is money to raise the Corcoran levee to protect the nearby city and a pair of state prisons from ongoing flooding in the Tulare Lake basin. The estimated cost for raising the 14.5-mile levee is $17.2 million.

Part of the flooding package is $40 million for floodplain restoration, which scientists and advocates have long argued will help reduce flood risk by allowing overflowing rivers to spread out, slow down and sink into the ground.

“We expect there will be a significant impact related to this investment in the Valley right away. You’re talking about expanding floodplains by hundreds to thousands of acres and getting as much as possible of this ‘Big Melt’ back into the ground to replenish aquifers,” Rentner said.

Environmental activists dismayed

Much of the proposed flood funding comes from a pot of money intended for drought response before this winter’s atmospheric river storms. To the displeasure of other environmental advocates, previous cuts to energy and transportation programs remain in place.

“We’re very behind,” said Melissa Romero, the senior legislative manager of California Environmental Voters. “We really can’t afford to have climate be something that only gets funded during budget surplus years.”

Romero and Brandon Dawson, director of Sierra Club California, both questioned in interviews before Friday’s announcement why the governor would retain certain cuts in environmental measures instead of placing more of the burden on oil and gas industries to deal with the deficit.

Dawson acknowledged the need for cuts given the economic outlook, but did not agree with everything the governor proposed to decrease funding from.

After the May budget release, Dawson said that “funding was not restored for key initiatives in equitable building decarbonization, rooftop solar, and coastal resilience. These investments would protect California’s most vulnerable communities at a time when they are still recovering from floods, droughts, and other natural disasters.”

Romero and Dawson stressed that the budget proposal was a “moral document” reflecting the state’s commitments.

Romero wants the state to restore corporate tax rates cut by the Trump administration. They want the state to review tax breaks that benefit oil and gas companies and to eliminate subsidies, as indicated in a May 8 letter sent from dozens of environmental groups to the governor.

“What we hope to see, after seeing the announcement today, is all of our elected leaders to be willing to end corporate handouts and restore corporate taxes to fund climate action in the state budget,” Romero said after the budget announcement.

Climate resilience bond

Newsom spoke Friday about a climate resilience bond to be approved by voters in 2024.

Wade Crowfoot, secretary of the California Natural Resources Agency, said in a call with reporters that the budget revision would shift certain funds into a general obligation bond, repaid from state or local general funds or a tax, assuming voters agree.

Among investments Crowfoot mentioned for this bond are $169 million to stabilize the Salton Sea; $60 million for the Sustainable Groundwater Management Program; $50 million for dams and flood management; and $20 million for agricultural-land repurposing.

“I know all of us are committed to partnering with the Legislature to develop a compelling proposal for the voters to pass a general obligation bond,” Crowfoot said. “Californians have a really strong track record in supporting such investments, particularly given the accelerating climate impacts.”

Before the Legislature now are an Assembly bill that could put a $4.5 billion flood response bond and a Senate bill for $6 billion climate resiliency bond on the 2024 ballot for voters to approve.

Dawson of Sierra Club said that the proposed bond was “unreliable.”

“The details of this bond remain uncertain,” he said, “and are subject to negotiation with the Legislature.”