California feud with Trump could impact budget surplus

One of California's chief budget writers says the state is bracing for a much smaller budget surplus next year because of its ongoing feud with the Trump administration about a tax involving Medicaid. Nearly $2 billion of California's projected $7 billion surplus would come from a tax on the companies that manage the state's Medicaid program. But California needs permission from the Trump administration to impose the tax. State Assembly Budget Committee chairman Phil Ting told reporters yesterday that lawmakers aren’t planning on the federal government approving the tax, saying the Trump administration has tried to thwart many of the state's policy goals.