Skip to content

Consistent access to health care is necessary for everyone to be healthy and thrive. During the pandemic, millions of Californians with low incomes have been able to keep their Medi-Cal coverage without administrative renewals and regardless of changes to their income. This is because of a temporary “continuous coverage” federal provision.1A provision in the federal Families First Coronavirus Response Act prohibits states from disenrolling Medicaid beneficiaries during the federally declared Public Health Emergency (PHE). The PHE will expire on April 16, 2022 unless the US Secretary of Health and Human Services Secretary extends it again. Despite ongoing hardships due to the pandemic, this federal provision may expire soon, which would disrupt health coverage for many.

Continuous health coverage allows children to receive preventive and primary care
services, which is crucial for very young children. Children who face housing insecurity are particularly vulnerable to losing coverage. When families move, double up with other households, or fall into homelessness, they may not receive timely information or submit paperwork required to maintain coverage, and they could lose continuity of care. About 6 in 10 children under age 5 who are income-eligible for Medi-Cal live in households that pay an unaffordable amount toward housing, placing them at risk of unstable housing and making continuous coverage critical.

The loss of continuous health coverage will particularly affect Latinx children in California.
Latinx children make up about 2 in 3 (66%) young children who are income-eligible for
Medi-Cal and live in households that pay an unaffordable amount of their income toward
housing, exposing the damaging effects of racism.

State policymakers should provide continuous coverage for children on Medi-Cal until at
least their fifth birthday. Every child should have the resources and opportunity to grow up
healthy and thrive.

  • 1
    A provision in the federal Families First Coronavirus Response Act prohibits states from disenrolling Medicaid beneficiaries during the federally declared Public Health Emergency (PHE). The PHE will expire on April 16, 2022 unless the US Secretary of Health and Human Services Secretary extends it again.

Stay in the know.

Join our email list!

Everyone should have the opportunity to be healthy and thrive, regardless of their race, gender identity, sexual orientation, income, or zip code. The California Department of Public Health as well as local public health departments play a critical role in protecting and promoting Californians’ health and well-being.1State departments other than the Department of Public Health often contribute to efforts to protect and promote public health. For example, the Department of Toxic Substances Control protects Californians from toxic substances. This analysis excludes such expenditures. Their core functions include infectious disease control, chronic disease prevention, health promotion, and more. Yet despite these important responsibilities, funding has not kept pace with the cost of preparing for and responding to ongoing and emerging health threats that endanger Californians.

State public health spending was generally stagnant or declining prior to the COVID-19 pandemic – leaving Californians vulnerable. Spending only recently increased largely due to the pandemic. Due to chronic underfunding of public health systems, counties and cities across the state were not adequately prepared to respond to COVID-19 and many Californians suffered as a result. The virus disproportionately impacted Black and brown communities, exposing the damaging effects of racism in California.

The California Department of Public Health as well as local public health departments play a critical role in protecting and promoting Californians’ health and well-being.

The governor’s proposed 2022-23 budget includes a new investment of $300 million for public health infrastructure at the state and local level, which would support workforce expansion, data collection, and more.2Department of Finance, Governor’s Budget Summary 2022-23 (January 10, 2022), 132-134, https://www.ebudget.ca.gov/2022-23/pdf/BudgetSummary/FullBudgetSummary.pdf. The budget also includes $235 million for state-level disease surveillance and IT operations. This commitment is a critical first step in reversing the chronic underfunding of public health systems and ensuring that Californians, especially communities of color, don’t bear the costs of an unprepared state.

  • 1
    State departments other than the Department of Public Health often contribute to efforts to protect and promote public health. For example, the Department of Toxic Substances Control protects Californians from toxic substances. This analysis excludes such expenditures.
  • 2
    Department of Finance, Governor’s Budget Summary 2022-23 (January 10, 2022), 132-134, https://www.ebudget.ca.gov/2022-23/pdf/BudgetSummary/FullBudgetSummary.pdf.

Stay in the know.

Join our email list!

Californians deserve to have quality education and affordable health care, child care, and housing. To support such services, California’s tax and revenue system needs to generate adequate ongoing resources. Policymakers must regularly examine the state’s revenue system and revise it as needed to fairly raise enough revenue to support services and investments that help Californians thrive in their communities.

California largely relies on three revenue sources — the personal income tax, the sales and use tax, and the corporation tax. Together, they make up 95% of General Fund revenues. General Fund money may be used for any purpose and is the primary source of state support for health and human services, K-12 education, and higher education.

The personal income tax provides more than two-thirds of General Fund revenue. Individuals are taxed on income from sources such as wages, salaries, investments, pensions, and certain types of businesses. Higher portions of income are subject to higher tax rates, ranging from 1% to 12.3%, plus a 1% surtax on income over $1 million for a mental health services special fund.

more in this series

See our 5Facts: California’s Tax & Revenue System Isn’t Fair for All to learn how elements of California’s tax and revenue system further or impede the goals of economic and racial equity for households, communities, and the state.

The next largest revenue source for California is the sales and use tax, making up about one-sixth of General Fund revenues. The sales and use tax is levied on purchases of tangible goods in the state — not services — or the in-state use of goods purchased elsewhere. The statewide sales and use tax rate is 7.25%, but local governments may levy additional taxes.

California’s third-largest revenue source is the corporation tax, providing about one-tenth of General Fund revenues. This is a tax levied on the California profits of corporate businesses at a rate of 8.84%, or 10.84% for financial corporations. California generally taxes the share of a corporation’s income equal to the proportion of their sales that are attributable to California. The remainder of General Fund revenues come from taxes on insurance company premiums, alcoholic beverages, and cigarettes as well as non-tax revenue sources.

It is critical for policymakers and advocates to understand how California raises revenue and identify opportunities to improve the state’s tax and revenue system to equitably generate enough revenues to support services Californians need to thrive. This Fact Sheet is one of a series of publications looking at: the state’s tax and revenue system, tax breaks for the wealthy and large corporations, and how tax policies can better promote economic security for Black, Latinx, Asian, American Indian, and undocumented Californians, and families with low incomes. 

Stay in the know.

Join our email list!

Californians should be able to take paid time off to care for themselves or their family without risking their jobs or financial security. The state’s paid family leave program was created to help workers balance these career and caregiving commitments, but many California workers are unable to utilize the leave because payment rates are too low. State leaders can ensure workers receive the full benefits of paid family leave by boosting payment rates and ensuring Californians do not have to choose between their job and caring for their family.

Most California workers contribute to paid family leave and are eligible for paid time off – up to eight weeks to attend to a sick family member or bond with a newborn or adopted child.1Workers are eligible for paid family leave if they earn at least $300 during the “base period” (a 12-month period ranging from five to 18 months prior to the claim) while contributing to the state’s Disability Insurance Fund. In addition to paid family leave, birthing parents can take an additional four weeks of paid time off before their due date and six weeks after the birth by using state disability insurance. Birthing parents that have had a Cesarean section receive an additional two weeks of disability insurance. After disability insurance ends, birthing parents can then take eight weeks of paid family leave. State disability insurance replaces wages at the same rate as paid family leave. However, California workers with very low wages receive payments that are equal to just 70% of their earnings, and all other workers receive payments that are equal to 60% of earnings.

Many Californians would struggle to pay their bills on a fraction of their earnings, and these low payment rates block access to paid family leave for workers. This is especially the case for workers with low wages who are disproportionately women, Black, and Latinx Californians.2“Low-Wage Work in California Data Explorer,” University of California, Berkeley, Labor Center (website), accessed February 7, 2022, https://laborcenter.berkeley.edu/low-wage-work-in-california/. In 2020, more than 18 million workers in California contributed to paid family leave and were eligible to utilize the program. Of those who were eligible, 37% were workers with less than $20,000 in annual wages. Of these same workers, only 14% utilized paid family leave.

Chart Title: California Workers with Very Low Wages Are Underrepresented Among Those Utilizing Paid Family Leave

In 2020, just 608 out of every 100,000 eligible workers earning less than $20,000 annually took paid time off work to care for their family. Workers earning between $80,000 and $99,999 annually had a utilization rate that was nearly four times higher than for workers in the lowest wage bracket. Eligible workers in the highest wage bracket — earning more than $100,000 annually — also had a comparatively low utilization rate. Despite this, these high earners still utilized paid family leave at a rate that was nearly three times that of workers earning less than $20,000 annually.

Chart title: California Workers with Vary Low Wages Are Far Less Likely to Utilize Paid Family Leave

Policymakers temporarily increased payment rates for the paid family leave program in 2018.3Assembly Bill 908 (Gomez, Chapter 5, Statutes of 2016), https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201520160AB908. This change increased the payment rate from 55% of earnings to 70% for workers with very low pay and 60% of earnings for all other workers. This temporary increase was set to expire at the end of 2021, but state leaders extended the sunset date by one year in the 2021-22 budget agreement. Absent permanent action by state leaders, payment rates will revert to just 55% of earnings at the end of 2022, blocking access for even more workers in California.

Policymakers should follow the lead of other states with paid family leave programs and permanently implement a more progressive payment rate structure.

State leaders can support workers and families while also dismantling economic, racist, and sexist barriers blocking workers from thriving in their workplaces and homes. California policymakers should follow the lead of other states with paid family leave programs and permanently implement a more progressive payment rate structure. A more progressive payment rate structure would fully replace wages for lower-wage workers up to a higher earnings threshold. Currently, full-time workers paid the $15 minimum wage earn too much to receive the highest payment rate of 70%. Boosting payment rates — particularly for workers earning lower wages — would eliminate a barrier in accessing paid family leave and allow more Californians to utilize this critical program to help their families thrive.


Support for this report was provided by the Conrad N. Hilton Foundation.

  • 1
    Workers are eligible for paid family leave if they earn at least $300 during the “base period” (a 12-month period ranging from five to 18 months prior to the claim) while contributing to the state’s Disability Insurance Fund. In addition to paid family leave, birthing parents can take an additional four weeks of paid time off before their due date and six weeks after the birth by using state disability insurance. Birthing parents that have had a Cesarean section receive an additional two weeks of disability insurance. After disability insurance ends, birthing parents can then take eight weeks of paid family leave. State disability insurance replaces wages at the same rate as paid family leave.
  • 2
    “Low-Wage Work in California Data Explorer,” University of California, Berkeley, Labor Center (website), accessed February 7, 2022, https://laborcenter.berkeley.edu/low-wage-work-in-california/.
  • 3
    Assembly Bill 908 (Gomez, Chapter 5, Statutes of 2016), https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201520160AB908.

Stay in the know.

Join our email list!

COVID-19 has disrupted California Community College (CCC) students’ higher education plans, causing many to reduce their course loads or pause their education altogether. The CCCs serve high percentages of students of color and students with low incomes, and drops in enrollment can further narrow educational opportunities and undermine workforce development priorities statewide. While state and federal leaders have enacted policies to mitigate the pandemic’s effects on CCCs, the path forward for community college students requires more long-term investments that address their broader educational and economic needs.1

Chart title: American Indian, Black, and Latinx California Community College Students Experienced the Largest Drops in Enrollment

The number of full-time equivalent students (FTES) at the CCCs declined steeply compared to pre-pandemic levels — nearly 12% overall from fall 2019 to fall 2020, the largest year-over-year decrease in over a decade.2 An FTES represents one student who takes a full course load during an academic year.3 The decline in FTES reflects a drop in the number of students, a reduction in student course loads, or both. While all racial and ethnic groups experienced declines, American Indian or Alaska Native students had the largest drop (23%) followed by the drop in Black students (17%)­. Latinx students fell by 12%, representing over half of the total decline. Reductions from fall 2019 to fall 2020 vary across campuses and student groups. All but six colleges saw declines and ten colleges had drops greater than 25%, and the 19-or-under and the 20-to-24 age groups had declines of approximately 10% and 15%, respectively.

Loss of income due to job losses has particularly affected community college students.

Research shows that the pandemic affected students’ decisions to cancel or delay their education plans.4 Loss of income due to job losses has particularly affected community college students.5 The added financial stress on students’ budgets has disproportionately impacted Black and Latinx students, with many reporting increased food insecurity and having missed rent, mortgage, or utility payments.6 Moreover, online education challenges such as inequitable access to broadband have also made it more difficult for students to continue their enrollment.7

Policymakers can support community college students of color and those with low incomes by pursuing policies centered on robust retention, housing, food, health, access to technology, child care support, completing transfer requirements, and developing career training. State investments in community college students now will pay off as they continue building their careers, futures, and lives across the state, and ensure that a skilled workforce is available to support the California economy.


This work was made possible through the support of Lumina Fund for Policy Acceleration, a sponsored project of Rockefeller Philanthropy Advisors.

Stay in the know.

Join our email list!

The COVID-19 pandemic has disrupted California students’ and families’ lives — affecting learning, upending social and emotional support systems, and creating a caregiving crisis. Students have also missed out on expanded learning opportunities, such as before and after school, summer, and intersession programs. Expanded learning programs offer academic enrichment for over 900,000 students throughout the year. These programs serve mostly students of color and low-income students as well as English language learners and students experiencing homelessness.1 Many parents rely on these programs for safe and supportive learning environments for their children while they work.

Chart Title: State Funding for Expanded Learning Programs Has Not Kept Pace with Rising Staff Costs

While demand for quality expanded learning programs and the needs of the expanded learning workforce were rising even before the pandemic, state funding stalled. California’s expanded learning system is funded with state and federal dollars.2 The After School Education and Safety (ASES) program provides state funds through grants that go directly to local educational agencies with priority for sites with higher percentages of students eligible for free and reduced-price meals.3 For a decade, starting in fiscal year 2006-07, annual state funding for ASES remained at $550 million. Policymakers increased funding to nearly $650 million in recent years, which allowed for an increase in the daily per student allocation, but that falls short of the level necessary to cover costs — largely due to the increasing minimum wage. Programs that receive ASES grants have struggled to keep their doors open with a per student daily rate that has increased by just 18% since 2006-07, from $7.50 to $8.88. During that same period, the minimum wage has increased by 93%, a much-needed and long-overdue increase that helps ensure that the expanded learning workforce is supported, but that significantly increases ASES program costs at the same time.

Growing demand for ASES grants exceeds available funds, and state and federal pandemic response funds for expanded learning are one-time dollars — leaving the workforce, students, and parents uncertain about their ability to return to school and work. Given the state’s strong fiscal condition, state lawmakers should provide a cost-of-living adjustment to support the expanded learning workforce and make long-term and sustainable investments in ASES funding that can support students’ academic and social-emotional development as well as families’ caregiving needs.

Stay in the know.

Join our email list!

Millions of California seniors and people with disabilities turn to Medi-Cal — known federally as Medicaid — for essential health care because ableist, ageist, racist, and classist policies and practices have blocked them from access to jobs, income, and wealth that can provide health coverage throughout their lifetimes. These Californians face further discrimination due to an asset test in Medi-Cal that unfairly applies only to people age 65 or older or who have a disability.1 The asset test has strict limits and complex rules that discourage savings, weaken households’ financial stability, and benefit homeowners while putting renters at a disadvantage.

Medi-Cal limits seniors and people with disabilities to assets of no more than $2,000 for individuals and $3,000 for couples — a restriction that has not changed since 1989. Assets include cash on hand, money in a checking or savings account, a second car, and other resources. In addition, seniors must have household incomes that do not exceed 138% of the federal poverty line — $1,482 per month for a single adult or $2,004 for a couple as of 2021.

State policymakers can eliminate the asset test and help to advance health equity for all Californians.

Policymakers have chosen to exempt certain assets from counting toward the limit. However, by treating resources differently, they have created an uneven playing field. In particular, a primary residence is exempted from the asset test, benefitting homeowners who may qualify for Medi-Cal even with substantial property wealth. In contrast, California renters — who may have other forms of wealth, such as cash savings — do not benefit from significant exemptions. They may be compelled to “spend down” much of their savings to qualify for Medi-Cal — money they could have used for other purposes such as moving costs, emergency expenses, and financing their retirement.

Among seniors who are income-eligible for Medi-Cal, nearly 2 in 3 Asian and Black Californians live in renter households, as do more than half of Latinx and other seniors of color. Homeowners are disproportionately white and renters are disproportionately Californians of color due to the legacy of racist policies and practices in housing, education, and employment.

Chart title: More Than Half of Seniors of Color with Incomes at or Below 138% of Federal Poverty Line Live in Renter Households

State policymakers can eliminate the asset test and help to advance health equity for all Californians. Nine states plus Washington D.C. have increased their Medicaid asset limits, and Arizona abolished its asset test entirely. California’s Legislature has taken similar action to eliminate or increase asset limits in other support programs and can build upon progress made to help families and communities lead healthy lives.


Support for this Fact Sheet was provided by the California Health Care Foundation.

Stay in the know.

Join our email list!

More than 6 in 10 California children under the age of 12 live in families where all parents are working.1 For this reason, child care providers are a critical component of the state and nation’s economic infrastructure, ensuring that children have a safe space to learn and grow while parents work. Many providers in California have stepped up to the challenge of delivering care and distance learning support for families during the COVID-19 pandemic and recession — particularly for children with parents who are essential workers. But the state’s child care system is on the verge of collapse.

Already operating on thin financial margins, child care providers are struggling with a loss of income due to reduced enrollment, while facing dramatically increased costs necessary to keep children and staff safe and healthy. Many providers report losing money and turning to personal savings and credit cards in order to sustain operations.2 Since the pandemic began, many providers have closed their doors in California and thousands will not reopen.3 In addition, nearly 3 in 10 jobs in the child care industry have been lost during the crisis.4 These business owners and workers are primarily women and Black, Latinx, immigrant, and other workers of color. The loss of small businesses and jobs coupled with a decrease in child care supply for working families only exacerbates the economic toll of the pandemic on workers of color, women, and their communities.

Child care providers are struggling with a loss of income due to reduced enrollment, while facing dramatically increased costs necessary to keep children and staff safe and healthy.

Both the state and federal government have provided emergency funding to support child care providers and families this past year, but total support falls far short of the estimated level necessary to sustain this critical industry. The federal COVID relief package enacted in late 2020 included $10 billion in federal Child Care and Development Block Grant funds. California received $964 million of this funding. Policymakers and the administration must ensure that these one-time federal relief dollars are distributed equitably and without delay to avoid additional closures and layoffs as well as to support working families.

The state’s fiscal health is unexpectedly strong despite the current crisis. Policymakers should also invest one-time funds to help strengthen California’s child care infrastructure and dedicate ongoing funding to help families afford care and to pay providers fair rates. Even prior to the pandemic, 60% of Californians lived in a child care desert with limited access to child care providers.5 California’s economy cannot recover from the shocks of the COVID-19 pandemic until children have a safe place to learn and grow, working parents can return to their jobs, and providers are supported in sustaining the critical child care industry.


Support for this Fact Sheet was provided by First 5 California. 

Stay in the know.

Join our email list!