California extends CA RISE program with $17M for employment social enterprises

The Senate Budget and Fiscal Review Subcommittee No. 4 on State Administration and General Government convened on March 27, 2025, to discuss key funding initiatives aimed at enhancing economic mobility in California. The primary focus of the meeting was the extension of the California RISE (CA RISE) program, which is designed to support employment social enterprises (ESEs) across the state.

Terrilyn Gray, Director of the Office of the Small Business Advocate, presented the proposal for extending CA RISE for an additional two years, backed by a budget allocation of $17 million. This funding aims to provide direct financial and technical assistance to ESEs, which play a crucial role in helping individuals facing employment barriers. The program, launched in 2023, is noted as the first statewide initiative of its kind in the nation, focusing on building the capacity of these organizations to foster economic inclusion.

Gray highlighted that the current iteration of CA RISE has already supported approximately 13,000 jobs through its initial funding round, which included grants ranging from $100,000 to $500,000 for participating ESEs. However, concerns were raised regarding the effectiveness of the program, particularly in light of the lack of comprehensive evaluation data from the first funding round.

Charles Lassalle from the Department of Finance reiterated the importance of the program in promoting economic mobility but acknowledged the need for ongoing evaluation to ensure its success. The Legislative Analyst's Office (LAO) expressed skepticism about the program's potential effectiveness, citing data from a similar initiative, LA RISE, which indicated that while participants experienced short-term employment gains, they did not achieve long-term job stability. The LAO recommended that the legislature consider rejecting the proposal unless further evaluations and modifications were made to enhance its effectiveness.

In response, Gray defended the CA RISE program's structure, emphasizing its focus on capacity building rather than merely job placement. She argued that the program's design is fundamentally different from LA RISE, aiming to equip organizations with the tools necessary for sustainable employment outcomes for individuals.

The meeting concluded with a call for further discussion on the proposed funding extension, with committee members considering the need for additional data and evaluations to inform their decision-making process. The subcommittee's next steps will involve reviewing the recommendations and determining the future direction of the CA RISE program.