California To Spend $1.8 Billion More On Virus Response

FILE - In this Jan. 10, 2020, file photo, California Gov. Gavin Newsom gestures toward a chart showing the growth of the state's rainy day fund as he discusses his proposed 2020-2021 state budget during a news conference in Sacramento, Calif. Newsom will reveal his plan Thursday, May 14, for how to plug a $54.3 billion hole in the state budget. California's revenues have plummeted since the state has been under a mandatory stay-at-home order to stop the spread of the coronavirus. (AP Photo/Rich Pedroncelli, File)
FILE - In this Jan. 10, 2020, file photo, California Gov. Gavin Newsom gestures toward a chart showing the growth of the state's rainy day fund as he discusses his proposed 2020-2021 state budget during a news conference in Sacramento, Calif. Newsom will reveal his plan Thursday, May 14, for how to plug a $54.3 billion hole in the state budget. California's revenues have plummeted since the state has been under a mandatory stay-at-home order to stop the spread of the coronavirus. (AP Photo/Rich Pedroncelli, File)

By ADAM BEAM Associated Press

SACRAMENTO, Calif. (AP) — California Gov. Gavin Newsom on Thursday took an extra $1.8 billion from the state’s dwindling coffers to pay for more protective gear and extra hospital beds to aid the state’s response to the new coroanvirus.

Newsom expects the federal government will reimburse the state for 75% of that spending. The new spending comes as state lawmakers are debating what government services will be cut to cover an estimated $54.3 billion budget deficit caused by the virus-induced economic downturn.

The Newsom administration says it has authority to spend the money because he has declared an official state of emergency under the state’s Emergency Services Act. The new spending will bring the state’s total to $5.7 billion since March, when Newsom issued the nation’s first statewide stay-at-home order to slow the spread of the disease.

In a letter to state lawmakers, Department of Finance Director Keely Martin Bosler said most of the new spending — $1.3 billion — is to purchase personal protective equipment including masks, gloves and gowns. More than $661 million of that spending will go to Chinese electric vehicle manufacturer BYD, which last month secured a $1 billion contract with the state to deliver 200 million masks per month.

But BYD has had trouble fulfilling that contract. Earlier this month, it refunded the state $247 million after it missed a deadline to certify that the masks it delivered comply with federal standards.

The rest of the money will pay for a call center and the state’s efforts to test people for the virus and track down people who have been exposed to it. It will also buy an extra 3,000 hospital beds and pay for hotel rooms for healthcare workers who treat COVID-19 patients.

The Newsom administration is not done spending. The governor has asked lawmakers for an additional $2.9 billion in the upcoming budget for him to spend as he sees fit on coronaviruis-related expenses. He says he needs the money should the anticipated “second wave” of virus cases hit the state this fall when the Legislature is not in session.

State lawmakers have balked at Newsom’s proposal, saying they don’t want to give up their authority to approve state spending. Assembly Budget chair Phil Ting, a Democrat from San Francisco, is scheduled to hold a public hearing Friday on Newsom’s request.

“I think it’s very important that the administration find a way to balance our ability to respond timely while acknowledging the role the Legislature must play to partner with you to make decisions that are in the best interests of all Californians,” Senate Budget and Fiscal Review Committee chair Holly Mitchell said earlier this week.

Other Republican lawmakers have questioned the governor’s continued use of his emergency powers.

“It’s time to end the State of Emergency and strip the Governor of the power he promised not to abuse,” Republican Sen. Melissa Melendez posted to her Twitter account on Thursday.

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