On May 14, 2026, Governor Gavin Newsom released the May Revision of his proposed 2026-27 state budget based on new information about state funds after taxes have been collected. You can read DRC’s response to the May Revision here.

We are disappointed that Governor Newsom’s May Revision reduces access to the services many people with disabilities need to survive and thrive in California. For years, elected leaders have threatened services for people with disabilities during each budget cycle. This is especially true for people with disabilities who have multiple marginalized identities like those who are Black, Indigenous, and people of color as well as immigrants and the LGBTQ+ community.

The governor boasts a proposed balanced budget with no deficit in 2026-27 or 2027-28. However, this was done by cutting programs meant to serve people with disabilities. The governor’s proposed budget presents a crisis for people with disabilities who are already facing extreme federal cuts that threaten access to the resources and services they need to live with dignity. Cutting services is a policy choice. Instead, the state can and must find new ways to raise enough money to cover Californians’ needs. 

You can read the governor’s summary of the May Revision here. By June 15, the California Legislature must pass a final budget that has been negotiated with the governor. Learn more about the California budget process here.

The following are some of the key proposed budget items that impact Californians with disabilities and the programs that assist them.

Healthcare/Home and Community-Based Services

Medi-Cal

Last year, Congress passed H.R. 1 which made extreme cuts to funding for vital health and human services. As a result, California could lose up to $30 billion in funding for Medi-Cal each year, with as many as 3.4 million people losing coverage. The governor’s proposed budget still does not account for these federal cuts or backfill these services. 

Below are some items still in place from the January proposed budget. 

• More paperwork: The budget adds federal work reporting requirements for immigrants accessing state-only Medi-Cal, a program not impacted by H.R. 1. It also requires them to renew their eligibility twice as often. These changes will result in even more people losing access to Medi-Cal.
• Humanitarian immigrants: Humanitarian immigrant groups such as refugees, asylees, and domestic violence survivors would lose access to full-scope Medi-Cal. Instead, they would be moved to restricted-scope Medi-Cal which only covers emergency and pregnancy care. In the January proposal, this would have started October 1, 2026. The May Revision pushes the start date out until July 1, 2027 and moves these enrollees to Fee-for-Service Medi-Cal from January 1 through July 1.

The May Revision proposed devastating new cuts to Medi-Cal. 

• Asset limit: The May Revision proposes to bring back the Medi-Cal asset limit for disabled adults and seniors of $2,000 for a single person or $3,000 for a couple. This would start January 1, 2027 or later, cutting around 62,000 people off Medi-Cal in the first two years. This deeply inhumane approach demands extreme poverty to continue receiving critical health care. DRC and many others fought tirelessly for years to get this asset limit removed. This cut is estimated at $278.3 million in the first year and $495.6 million in future years. 
• $50 Medi-Cal premiums for some: Adults age 19-59 with “unsatisfactory immigration status” (UIS) would have to start paying $50 each month to access Medi-Cal starting July 1, 2027. Some groups considered UIS have Deferred Action for Childhood Arrivals (DACA), have temporary visas, or are undocumented. This financial barrier is another attack on healthcare access for communities that are already struggling. This is an estimated cut of $427.3 million in 2027-28 and $314.3 million annually starting 2029-30.

In-Home Supportive Services (IHSS)

In-Home Supportive Services (IHSS) is a Medi-Cal program that allows people with disabilities and older adults to access help with services like personal care, housework, and accompaniment to medical appointments. This allows them to continue living in their homes. This January proposed budget made several changes that are likely to make it harder to access care through the IHSS program. These changes are unfortunately still present in the May Revision. 

• More IHSS cost for counties: The proposed budget would shift $233.6 million in costs for increased IHSS hours from the state to the individual counties running the IHSS program. Currently, if a person becomes eligible for more IHSS hours, the state is responsible for paying the cost of those hours. With this budget proposal, that cost would shift to the counties. While the full impact is unclear, counties are already facing serious financial challenges, and this change may cause them to lower the amount of IHSS hours approved for individual recipients.
• Cutting the IHSS Backup Provider System: The budget proposes to eliminate the IHSS Backup Provider System beginning in 2026-27, with a cost savings of $3.5 million. This program is meant to provide temporary backup care for IHSS recipients when their primary provider is not available.
• Limit use of IHSS Residual Program: The budget proposes to immediately end a person’s IHSS benefit when their Medi-Cal is discontinued. This is a change from the current system which allows IHSS benefits to continue temporarily by moving individuals who have lost their Medi-Cal into the IHSS Residual program. This change is a cut of $68 million in 2026-27.

Even worse, the proposed new asset limits are expected to cut $62.6 million in 2026-27 from IHSS alone. The cut will take this vital program away from 18,900 Californians over the next two years.

Other Healthcare

Premiums for Californians purchasing health coverage through Covered California (California’s Affordable Care Act marketplace) are expected to increase by an average of 97% because of H.R. 1. The May Revision proposes $110 million each year in new funding to help more people afford this monthly cost to keep their health coverage.

Mental Health and Behavioral Health

The governor’s proposed budget cuts community-based behavioral health services and advocacy while directing hundreds of millions of dollars to coercive and harmful programs like CARE Court. Below are behavioral health funding cuts in the governor’s proposed budget that would be particularly damaging.

• Mobile Crisis Response Services: Despite broad opposition since his January proposal, the governor’s May Revision would still eliminate state funding for community-based mobile crisis services beginning April 1, 2027. Mobile crisis response teams are safer, more appropriate, and more effective at responding to mental health crisis calls than law enforcement. These teams provide crisis intervention services in the community that can prevent unnecessary and costly institutionalization. The proposal would shift the financial responsibility to counties, which are already facing significant budget shortfalls due to the Behavioral Health Services Act and other cuts. 
• Community Advocacy and Engagement: The May Revision proposes eliminating the Commission for Behavioral Health’s $6.7 million Community Advocacy Program. This critical program ensures that people with lived experience—including consumers, diverse racial/ethnic minorities, immigrants and refugees, LGBTQ+ individuals, veterans, children, transition-age youth, parents, and families—have a meaningful voice shaping California’s behavioral health system. Eliminating this program would silence community input, weaken accountability, and dismantle culturally responsive, peer-led outreach and advocacy. The result would be a behavioral health system increasingly designed without the participation of those most impacted. 
• Behavioral Health Innovation Funding: The governor’s May Revision proposes cutting the Commission for Behavioral Health’s Innovation Partnership Fund in half—from $20 million to $10 million. This fund is the only dedicated statewide resource for testing, evaluating, and scaling innovative approaches to mental health and substance use services, including community-based outreach, early intervention, peer-led models, and culturally responsive programs. This proposed cut would significantly reduce the number of projects that can move forward, leaving our behavioral health system with fewer resources to meet diverse community needs. 

Department of Developmental Services (DDS)

The Department of Developmental Services (DDS) and the regional center system are not facing specific cuts in the 2026 May Revision. However, we acknowledge that changes to IHSS, the Medi-Cal asset limit, and Medi-Cal for immigrants all could result in cuts to services for people with intellectual and/or developmental disabilities (I/DD). 

The May Revision includes new Trailer Bill Language (TBL) that makes policy changes relevant to people with I/DD. These include: 

• State Operated Facility – Porterville Developmental Center (PDC): The TBL adds a time limit of two years for how long people on 6500 holds can stay at PDC, starting in 2031. There was previously no time limit. With the existing two-year limit on PDC placement for competency restoration, this policy would set a maximum stay of four years, a marked positive difference from the previous unlimited timeframe. 
• State Operated Facility – Canyon Springs Developmental Center: Similarly, the TBL limits certain Canyon Springs commitments to two years, and phases out newly sending people to this facility as of July 1, 2027.
• Tailored Day Services: The TBL updates the Tailored Day Services statute to specify that this service can be received on the same day as supported employment individual placement services.
• Needs Assessment: The TBL starts the process to create a standardized needs assessment to eventually replace the Client Development Evaluation Report.

The Department continues to work on TBL from the January proposed budget, including the Access Rule update to the complaint process.

Education

The governor’s 2026-27 budget continues to prioritize K-12 education funding through Proposition 98, the constitutional guarantee that sets minimum funding levels for schools and community colleges. Overall, the proposal reflects a continuation of major education investments made over the past several years. 

The proposed budget maintains and expands several education programs focused on student support and equity. These investments matter significantly because students with disabilities benefit greatly from school environments that prioritize whole child support, coordination of services, and family engagement. Specifically, the proposed budget includes: 

• Special education funding: There is significant good news in the May Revision. The January proposed budget included a $509 million discretionary funding increase, and the May Revision adds an additional $1.8 billion. This adds up to an almost $2.4 billion increase, or 43%, over last year’s budget. This increase reflects the increased percentage of California students eligible for special education services and the pressure from school districts and advocates for the state to provide more resources to support students with disabilities. 
• Community schools model: $1 billion is proposed to expand the community schools model, which integrates academic instruction with health, mental health, and social services, and additional funding to fully equalize special education base rates across school districts. 
• Office of Civil Rights: $3.6 million General Fund in 2026-27, and $2.8 million General Fund in 2027-28, and ongoing, are proposed to establish the Office of Civil Rights (OCR). The OCR will provide educational resources, training, and technical assistance to local educational agencies to prevent and address discrimination and bias within California’s TK-12 education.

Housing and Homelessness

Housing 

The governor’s proposed budget does some reorganizing but does not include any new state funds for affordable housing programs. 

• Affordable housing ignored: Despite strong coalition advocacy since his January proposal, the governor’s May Revision still has no new investments for affordable housing programs, including the Low-Income Housing Tax Credits (LIHTC). LIHTC is often the main accessible option because it is the main type of “affordable” housing that has been built since the Americans with Disabilities Act design rules went into effect.
• Reorganized governance: The May Revision has increased emphasis on implementing the new California Housing and Homelessness Agency and the Housing Development and Finance Committee as part of the governor’s Reorganization Plan. The impacts of this reorganization are still to be determined. 

Homelessness

The governor’s proposed budget does not include new funding for homelessness prevention or assistance, but it does include new funding for homelessness enforcement. 

• No new Homeless Housing, Assistance, and Prevention (HHAP) funding: Despite strong coalition advocacy, the proposed budget still has no new HHAP funding. The $500 million mentioned in the proposed budget is carried over from a prior commitment, and is a 50% reduction from previous years. A related trailer bill adds concerning requirements to get the funding that remains, including a requirement for jurisdictions to have policies to evict people from encampments. 
• Increased funding for enforcement: The proposed budget includes $1 billion for the Encampment Resolution Fund, $6.2 million for “homeless encampment liaisons,” and an unknown portion of $40 million for “Clean California” program funding to be used on evicting people from encampments. We know from members of the community that when encampment residents are forced to move they lose everything from critical documents to medicine to family heirlooms – setting them back years, in addition to causing further trauma. And few, if anyone, actually gets connected to housing.