California Legislature Places Constitutional Amendment to Strengthen Rainy Day Fund on November Ballot

• Noah Marty
• Legislative/Communications Assistant
• [email protected]

SACRAMENTO, CA - Today, the California State Legislature passed Assembly Constitutional Amendment (ACA) 20, the Save For California's Future Act - a proposed constitutional amendment that strengthens and modernizes California's Rainy Day Fund to better prepare for economic uncertainty and safeguard funding for essential public services. The proposal will now appear before voters on the November 3, 2026 ballot.

"Just like California families save for emergencies and unexpected expenses, our state government should set aside funding during good years to protect schools, public safety, and essential public services," said Assemblymember Jesse Gabriel (D-Encino), Chair of the Assembly Budget Committee and author of ACA 20. "By placing this proposal on the November ballot, we are giving California voters the power to create a stronger and more resilient Rainy Day Fund. ACA 20 is an investment in California's future and a commitment to responsible stewardship for future generations."

Authored by Assemblymember Jesse Gabriel, ACA 20 builds on the wisdom of California families by setting aside savings during the good times to prepare for downturns and unexpected challenges. In particular, ACA 20 would:

• Increase the constitutional cap on California's main rainy day fund, from 10% to 20%
• Fully protect guaranteed funding for California's public schools
• Increase the amount saved in the rainy day fund during years when taxes generated by capital gains and other asset-related income reach especially high levels
• Extend the requirement that certain funds be dedicated to paying down state liabilities and expand the types of liabilities that can be paid down, including for schools and federal Unemployment Insurance loans

What California's Leaders are Saying
"Californians live by a simple, bipartisan truth: set money aside when times are good so you're ready when they're not. As California's leaders, we are stepping-up to save more, protecting the health care, school and affordable housing programs families count on. The Save For California's Future Act is what responsible leadership looks like - and future taxpayers will thank us for it." -Speaker of the Assembly Robert Rivas

"Growing up, my family owned a small business. I learned early how saving responsibly allows us to weather the unexpected. I carry that lesson with me today. ACA 20 brings that same financial discipline to our state budget, so we can prepare during strong years and protect families without raising taxes. It is our duty to leave the next generation a stronger California than the one we inherited." -Assemblymember Avelino Valencia (D-Anaheim)

"Californians deserve real results, and this commonsense reform delivers. A stronger budget reserve is good governance, pure and simple, and will strengthen our state for the long term." -Brian Brennan, Executive Director of the 21st Century Alliance

Background on ACA 20
The Save For California's Future Act would deliver greater stability for California taxpayers by creating a stronger financial foundation - one that better prepares for uncertainty and helps preserve the services, programs and benefits that families rely on most.

While the state's economy is among the largest and most dynamic in the world, it is also subject to the same economic cycles and fluctuations in revenue experienced by every nation. Natural disasters, public health emergencies and other unforeseen events can place significant strain on the state budget.

When state revenues decline during economic downturns, insufficient reserves can force difficult choices that disrupt the essential programs and services that California families, workers and businesses need to survive.

Building and maintaining strong budget reserves during periods of economic growth is not just the right thing to do: It protects Californians from sudden reductions in essential services and mitigates the need for drastic corrective actions during periods of fiscal stress.

Just like families save for emergencies and unexpected expenses, California should save during good years to protect schools, public safety and vital programs.