Gov. Brown, legislature agree on California budget

File: California Gov. Jerry Brown released a statewide budget.
File: California Gov. Jerry Brown released a statewide budget.
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Gov. Jerry Brown and Democratic legislative leaders have reached an agreement on a state budget that expands funding for subsidized child care and eliminates a controversial welfare policy that restricted cash assistance for more than 100,000 children.

Brown spokesman Evan Westrup says the agreement was reached on Thursday.

A key legislative budget panel quickly scheduled an evening meeting to approve it, setting up votes in the full Assembly and Senate next week.

The agreement includes $400 million for housing construction to help people with low income. But it's contingent on lawmakers approving a controversial proposal by Brown to speed up development in some neighborhoods.

Legislative leaders agreed to Brown's demand to save $2 billion more than required, boosting the state's reserve fund in case of a recession.

Capital Public Radio reported under the budget deal, California will repeal a two-decade old limit on state aid to women who have more children while on welfare.

The compromise budget eliminates the “maximum family grant,” which Democratic lawmakers have called discriminatory. It prevents higher welfare payments to women who have more children. 

The budget deal also includes $100 million for child care and preschool providers to help them pay employees as the statewide minimum wage gradually rises under a law signed earlier this year.

Child care and preschool providers voiced concerns they could not afford the higher salaries without an increase in state funding.

Under the deal, child care funding will gradually grow to $500 million in future state budgets as future minimum wage increases kick in.

The Brown administration says child care spending has always been treated as not required under a minimum wage increase. "This is a big change," says a top administration source.

The governor and Democratic legislative leaders agreed in March to gradually raise California's minimum wage – currently $10/hour – until it reaches $15 an hour in 2022.

Brown initially did not set aside the estimated $200 million it would cost the state to repeal the policy. 

The budget deal sets aside roughly half that amount for the upcoming fiscal year — and then uses money previously committed to county health programs that’s been freed up by the expansion of Medicaid.

This story has been updated.