Gov. Gavin Newsom has proposed a 67% reduction in funds to reach a groundbreaking deal with Google to support the struggling California Newsroom, citing financial pressures to promote wider budget cuts.
The California Newsroom is expected to receive $30 million from the state, part of a deal last year, in which Google and the state will jointly contribute within five years to support local newsrooms through the News Transformation Fund. The State Department confirmed Wednesday that California will pay $10 million in the fiscal year 2025-26.
“The only reason for the reduction is more limited/less than the resources expected in the January budget,” said the Treasury spokesman HD Palmer.
Newsom announced Wednesday that the state will face an additional $12 billion budget shortage next year. The revised $321.9 billion plan will also include reducing health care for low-income undocumented immigrants, while select government employees have reduced overtime.
The deal was born from a negotiation that began with a proposed funding bill written by the General Assembly Raising Act Buffy Wicks (D-Ooakland), known as California News Protection Act. It would have required Google to pay annually, and the fund would distribute millions of dollars to California news media based on the number of journalists they use. The California Press Publishers Association (Los Angeles Times) is a member, supporting a greater effort.
Its purpose is to help newspapers, which have collapsed in recent years, allowing journalists to reach less institutions and communities.
The proposal is modeled After the Canadian bill There is Google payment About $74 million per year. Google fought the bill, believing its pass would force the company to remove California news from its platform, thus limiting access to Californians.
Instead, the state and Google agreed in August to provide nearly $250 million to newsrooms, which will fund both projects starting in 2025.
The second initiative is a $68 million commitment to fund AI in the form of a nationwide AI accelerator. The AI funding element of the deal has attracted sharp condemnation from Democratic lawmakers and journalists.
California promised $30 million in 2025, with $10 million each year over the next four years. Google agreed to pay $15 million for the first time in 2025, with a total of $55 million to the News Fund. Google also agreed to enhance its own news program with a separate $50 million grant.
Steven Waldman, president of Rebuilding Local News, said the $30 million commitment to support local news was “moderate” but “a meaningful first step.”
“Cutting local journalism into two-thirds at a time when it collapses across the state would move California in the wrong direction,” Waldman said. “We urge the Legislature to hold open, transparent hearings to assess the impact of this shortage and explore ways to ensure funding matches the scale of the crisis.”
