The 2025-26 California state budget is a missed opportunity to show the nation how the 4th-largest economy in the world can lead in supporting its children, families and communities. If the state budget is a reflection of its values, then The Children’s Partnership is deeply disappointed to see that our state chose not to include funding for supports critical to the health and well-being of many of its most vulnerable constituents, including children, families and immigrants living on low incomes and without “satisfactory” immigration status. To abandon them now in the face of mounting attacks from the federal government is unethical and inhumane.
With that said, we know these are tough choices, and The Children’s Partnership appreciates investments in some key supports for children and families, especially in the area of mental health. However, we can do better.
Here is our analysis of the 2025-26 California state budget:
Moving Backward on Health4All: The budget makes egregious cuts to Medi-Cal, targeted specifically at immigrants so that California’s public health care system will now discriminate against immigrants by design. This includes a freeze on new enrollments for undocumented individuals ages 19 and older beginning in 2026, and making immigrants between the ages of 19 and 59 with “unsatisfactory immigration status” (UIS) pay a monthly premium of $30 beginning July 2027. (Immigrants categorized as UIS include both undocumented individuals as well as many lawfully present immigrants, such as permanent residents who have had a green card for less than five years.) Dental coverage will also be eliminated for UIS adults in July 2026. Taking any kind of health care coverage away from parents means their children will be less likely to receive care, even if their children are still eligible for it. It is especially shameful that state leaders have chosen to do this at a time when immigrant communities—the backbone of our state’s social fabric and prosperous economy—are being violently kidnapped by the federal government and inhumanely separated from their children and families.
$20 Million Increase in Immigration Legal Services: Funding of $10 million to continue the Children’s Holistic Immigration Representation Project (CHIRP), which provides integrated social and legal services to unaccompanied minors, and a $10 million increase for One California, which provides immigration legal services, was included in the budget. However, these contributions are far from a sustainable investment and the $60 million increase originally requested by more than 145 organizations. Federal attacks on immigrant communities—through executive orders, immigration enforcement, and the rollback of civil rights protections—have led to increased fear, confusion and distress for children. Legal and social service providers play a critical role in reducing this harm. California must meet the moment by investing in supports that help children feel safe in schools, access critical services, and plan for their futures without fear.
No Continuous Medi-Cal Coverage for Children Ages 0-5: The state has once again failed to include funding for continuous Medi-Cal eligibility for young children, despite clear evidence that such a policy supports early childhood health and would prevent unnecessary coverage loss, as most young children with Medi-Cal remain eligible throughout their first five years of life. By not funding this policy, our state falls behind when it should lead in supporting our youngest residents.
No Extension of Unwinding Flexibilities for Medi-Cal Eligibility: The flexibilities, which allow auto-verification of certain income and use of other data sources to aid in smoother Medi-Cal renewals, are proven to reduce churn, support administrative efficiency and prevent unnecessary health expenditures. Allowing unwinding flexibilities to expire risks the health care coverage of 450,000 eligible Californians – family members raising our state’s children.
No CHW/P/R Rate Increases: The state eliminated a modest $5 million planned rate increase for community health workers, promotores and representatives (CHW/P/Rs) – essential health providers who serve as a critical trusted bridge between underserved communities and the health care system – contradicting our state’s commitment to health equity.
$2.9 Million in ACEs Aware for Trauma-Informed Care: We appreciate that the state did not sunset the Adverse Childhood Experiences (ACEs) Aware program entirely, but this modest investment falls far short of the $25 million in state funds needed to fully sustain the program. We are disappointed that the final budget did not include the Legislature’s initial bold proposal to maintain nearly full funding for ACEs Aware at $20 million, and instead maintained the much smaller down payment of $2.9 million first proposed in the Governor’s May Revision. However, not providing any funding for the initiative would have had devastating consequences for the long-term health and well-being of California’s families. ACEs Aware has achieved several milestones in building the capacity of Medi-Cal providers to prevent, identify and treat toxic stress in children and families, and has had a profound effect on the rest of the nation as a model for similar programs. We are eager to collaborate as thought partners in securing long-term investment in upstream prevention as our state’s budget outlook improves.
$20 Million Saved for Maternal and Infant Mental Health: While the Governor’s May Revision proposed eliminating $20 million from the Behavioral Health Commission’s Mental Health Wellness Act grants, the final budget act restores this funding for 2025-26. The Mental Health Wellness Act (MHWA), established in 2013, has provided $20 million annually to support local response and early intervention to people facing mental health crises. The MHWA continues to support community-based wellness and prevention programs, with a renewed focus on expanding access to mental health care for young children and families. Current efforts include building out early intervention infrastructure, supporting integrated care models, and bolstering the workforce serving children ages 0-5.
$17.5 Million for 988 State Crisis Response: 988 is the National Suicide Prevention Lifeline and is operated in California by a network of local crisis response centers and dispatchers. The Trump administration recently targeted the LGBTQ+ line operated by the Trevor Project and abruptly eliminated its federal funding. The $17.5 million, while one-time, will temporarily supplement the $12.5 million in ongoing funds for 988 crisis response. (Unfortunately, funds for California’s 988 call centers are separate from the budget for non-emergency “warm lines” that serve as essential early intervention and recently experienced funding cuts.)
$9 Million Reduction for Family Crisis Stabilization: The Family Urgent Response System facilitates county-administered mobile response units to foster family homes during conflicts and mental health emergencies. This system serves as a model for de-escalation and divestment from law enforcement interventions when children and youth are experiencing significant distress. These responses help to reduce hospitalizations and the likelihood that foster youth will be kicked out of their placement. The final budget act reduces the program’s budget by $9 million annually, or about 30% of its budget, the impact of which will likely be reflected in longer response times and greater home instability for foster youth.
Extension of Child Care Enrollment-Based Prospective Pay: The budget extends enrollment-based prospective pay through June 30, 2026, meaning child care providers will get paid ahead of time each month based on how many kids are signed up, not by how many show up each day. This gives providers more predictable monthly income.
Inclusion of a Cost-of-Living Adjustment for Early Care and Learning Programs: Provides a cost of living adjustment (COLA) for all California Department of Social Services child care and preschool programs, using the Care Plus rates from the 2023-2024 budget with $70 million from the General Fund and $19.3 million from Proposition 98. While a COLA raise is appreciated, it may not fully offset the costs providers may incur, especially providers who live in high-cost areas. The state must take further steps to get providers closer to the median wage so they can keep up with rising costs like wages, rent and materials.
No Child Care Slots: This budget does not adopt the Legislature’s initial proposal to increase the number of child care slots. While the 10,000 slots originally proposed would have been a slight improvement, according to the California Budget & Policy Center, our state needs 2 million slots to truly meet the need.
$30 Million Cut to Emergency Child Care Bridge Program: The state will take back $30 million from the Emergency Child Care Bridge Program originally allocated in the 2024-2025 budget and apply it toward the General Fund, as well as cut another ongoing $30 million in the 2025-2026 budget. The bridge program ensures relatives and foster families have adequate support at the time when a child is first placed in the foster care system until they are able to secure longer-term child care solutions. Any reductions to programs that provide care for children in our state is an example of the deprioritization of children and their families. We should facilitate stable placements and address this critical need, as lack of affordable child care can be a barrier to foster care placement.
$40 Million Cut from HOPE Accounts: We are disappointed that the budget cuts $40 million of funding to the HOPE Accounts Program, reappropriating this money into the General Fund. These trust accounts are an investment in the future of more than 55,000 foster youth and children bereaved by COVID and a step toward ending child poverty in California.
We understand our state’s leaders were working under a heavy veil of uncertainty, as the federal government hadn’t finalized its budget when California passed ours. But we did know that unprecedented cuts were likely, and they have now come to fruition with President Trump’s July 4 signature on the bill. So we urge our California leadership to come back to the drawing table and reconsider these cuts made in our state budget – and lead the way in supporting the children who will be California’s future. We know we will, and TCP looks forward to working with our state representatives in ensuring a bright, thriving future for our youngest Californians.
