Newsom seals $351.7B California budget, bets on reserves to weather volatility

Governor Newsom and lawmakers reached a $351.7 billion budget deal that uses a windfall from stock gains and new taxes to avoid deep cuts, while boosting funding for schools, healthcare, childcare and housing, and proposing a larger rainy-day reserve via a constitutional amendment. The plan aims to weather revenue swings, but economists warn the fix may be temporary and the state remains structurally reliant on reserves amid a long-term deficit.