Newsom Administration Claims Another '$1.831 Billion Needed' by June 30

Autonomous Spending on Multi-million Dollar Contracts Demands Legislative Oversight. Nielsen Urges Citizens' Representatives - Legislators - to Assert Their Budget Authority over Spending Decisions
Friday, May 22, 2020

In a last-minute call Thursday evening, Department of Finance officials notified the Legislature that Governor Newsom is transferring an eye-popping $1.831 billion to the Disaster Response-Emergency Operations Account to spend through the current fiscal year with only limited details.

“The spending of billions of taxpayers’ dollars must be reviewed and approved by representatives of the citizens of California. It is time for the Legislature to return to the standard separation and balance of power,” said Vice Chair of the Senate Budget Committee Senator Jim Nielsen (R-Tehama). “There is too little transparency, oversight and accountability. The public deserves better.”

Without sufficient evidence to support the need for this massive spending, the letter from the Department of Finance breaks down expenditures as follows:

  • $1.3 billion to procure personal protective equipment.
  • $251.7 million to establish and support over 3,000 hospital beds.
  • $30 million for hotels for healthcare workers and support staff.
  • $159.4 million to cover costs for ongoing state response activities.
  • $98.4 million for statewide testing and contact tracing and tracking.

Californians have answered the call and slowed the spread of the virus. Hospitals are safe, and most have few, if any, COVID-19 patients. The U.S. Naval hospital ship Mercy has returned to the port in San Diego. The field hospital at Sacramento’s Arco Arena will close at the end of the month after the state paid an outrageous $1 million to house fewer than 10 patients.

Senator Nielsen said, “There is no surge in hospital demand in California.”

As the Los Angeles Times editorial stated, “[T]he state is moving from the emergency response phase into one of recovery, the governor needs to start sharing power again with the Legislature, as the state’s constitution intends. That means no more COVID-19 blank checks.”

“Long standing processes and procedures to establish the balance of power in our government must be strictly followed. The Administration must demonstrate why it needs this colossal pile of taxpayer dollars,” Senator Nielsen said.

“These purchases must come before the Legislature.”

BACKGROUND: Following news reports of failed contracts including a $1 billion agreement with Blue Flame, Senator Jim Nielsen (R-Tehama), along with a group of lawmakers, requested a thorough audit through the Joint Legislative Audit Committee of the sole source contracting practices in these multi-million dollar legal commitments.

The letter from the Department of Finance can be viewed by clicking here.