“Today, California Governor Gavin Newsom unveiled his state budget proposal for fiscal year 2023-24. As expected, the Governor’s proposal reflects a slowing economy as the historic budget surpluses of recent years recede. Governor Newsom’s speech emphasized the need to advance the debt-free college framework. But to do this, California must walk the talk by prioritizing need-based financial aid, which helps students cover the total cost of college, and continue to prioritize full reform in 2024.
“We applaud the Governor and legislative leaders for clearly signaling their intent to eliminate California state taxation of federal student debt cancellation. We look forward to working with state lawmakers to build on this by enacting a permanent end to state taxation of cancelled federal student debt. Doing so will ensure that after January 1, 2026, students who continue to receive federal loan forgiveness through one of the numerous existing paths to cancellation, such as income-driven repayment plans or student relief from repayment after school fraud and abuse, are not stuck with a burdensome state tax bill.
“Today’s proposal signaled the Governor’s continued commitment to the University of California (UC) and California State University (CSU) Compacts and the California Community Colleges (CCC) Roadmap. We appreciate Governor Newsom’s efforts to help students better afford and complete college by investing $3.9 million into the California College Guidance Initiative, $200 million one-time to support community college efforts to increase enrollment and retention rates, continuing transfer reform efforts statewide, and uplifting the importance of the Californians for All College Service Program.
“As our state leaders respond to the evolving economic conditions, investments in the postsecondary education of Californians are key for the state’s workforce development and a thriving economy. We look forward to working with the Newsom Administration and the California Legislature over the coming months to ensure that the final 2023-24 state budget incorporates policies and funding that prioritize racial and economic equity while balancing the state’s fiscal needs.”