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California proposed budget sustains digital ID project funding

California proposed budget sustains digital ID project funding

Modernization of key identity systems in the U.S. state of California is a small but unusually sunny part of the governor’s 2023-2024 budget message: Don’t panic.

And there is much to be concerned with in the state beyond floods, landslides and wildfires. All are stretching California’s Covid-scarred finances as a growing tech industry recession starves the state of tax revenue.

Governor Gavin Newsom did better than most of his also-stressed peers in selling a budget that is creaking under many demands. But he lit up when talking about the state’s digital ID program. Newsom also is pretty happy with modernization in the Employment Development Department.

“Know this, in just a matter of months, we’re finally going to have those digital wallets,” Newsom said as he summarized his budget.

“We’re going to do it like no other state has done it,” he said. A few have started mobile driver’s license and state IDs. “But there’s issues. Ours, we think it’ll be next-level. We’re so excited about what the DMV can look like.”

Newsom was a little less effusive about EDDNext, the state’s modernization project at the unemployment agency, but then, it is inherently less sexy and ultimately will take much longer to accomplish than a digital ID.

Newsom’s spending proposal calls for $198 million in one-time funding for EDDNext. Last year’s approved budget allocated $136 million. Details are few, but the assumption is that identity verification will be a significant part of the upgrade.

He wants to improve user testing, develop data analysis tools and get better at reducing fraudulent benefit claims.

Indeed, a separate, previously approved three-year allotment of $313.4 million is being used to specifically address unemployment insurance and state disability fraud.

The budget proposal, which cuts some spending, calls for steady support in these cases.

“Progress has been made there in the last few years,” said Newsom. “With humility, I say that, pending whatever new analysis” might come along with a less optimistic take.

His budget proposal separately calls for $85 million this year in labor and workforce development as part of an ongoing project to prevent fraud. Officials are looking at improvements to applicant ID verification.

The California governor also continues to push for a single digital ID for state residents interacting with agencies online — much like the national government’s Login.gov program. A pilot test involving the Transportation Department, the Integrated Travel Project, the Monterey-Salinas Transit Agency and the federal General Service Administration, which operates Login.gov, is planned.

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