Despite facing a $12 billion deficit, California’s budget for the upcoming fiscal year includes $100 million for infrastructure projects critical to Fresno’s ambitious downtown revitalization goals.

The funding is intended to pay for the construction of two large downtown parking structures under design. The final costs for the projects remain unclear.

“As soon as we have those dollars, we will award a contract,” Mayor Jerry Dyer said Monday.

The inclusion of downtown Fresno funding in the fiscal 2026 California budget, signed by Gov. Gavin Newsom on Friday, comes after the governor’s May proposal skipped mention of help for the city’s infrastructure projects.

The funding will allow Fresno to avoid having to take on extra debt to pay for the projects — an idea local elected officials said they were ready to act on last month.

The money is the second installment of the $250 million Newsom promised Fresno in 2023 to help bolster the city’s infrastructure so it can sustain a revitalized downtown population. Dyer envisions new housing developments to bring 10,000 residents to a bustling downtown anchored by a California high-speed rail station.

An initial award of $50 million in 2023 paid for the ongoing replacement of downtown water and sewer mains. But last year, California’s budget woes caused the state to delay two remaining $100 million awards for two years.

In the meantime, Fresno continued to plan other infrastructure upgrades, including a 900-space parking structure on H Street near Chukchansi Park and a 600-space structure planned to go up at the site of the shuttered CVS pharmacy on Fulton Street.

Delaying the projects “ultimately would have driven up the cost for the parking structures and forced us in a position, as we continued, to have to go bond money for that and incur debt,” said Dyer, who lobbied the governor to release the funds.

State Assemblymember Esmeralda Soria said Wednesday that obtaining the money came down to negotiating with the governor and other legislators.

“It was a negotiation effort, but a recognition from the state that this investment is needed today and not two years from now,” Soria said.

Downtown Fresno projects

The city of Fresno has moved fast to spend the money it already has received.

Construction began last year on $22 million-worth of sewer and water main replacements in downtown and Chinatown and is expected to be completed this fall. In April, the City Council approved a $2.2 million contract for the design of the 900-stall parking structure on H Street near Chukchansi Park.

Dyer said Wednesday the city will immediately begin infrastructure work in the North Fulton area and Cultural Arts District once work is completed on water and sewer mains in downtown and Chinatown.

The mayor said sewer and water main work along Fulton Street is expected to last six-eight months. Within that same time period, Dyer said, construction will begin on the 900-stall H Street parking structure — just steps from Chukchansi Park and the site of the future high-speed rail station.

The 600-stall structure planned to go up on Fulton Street at the site of the closed CVS store will serve an apartment project slated for 464 units, half of which will be considered affordable housing.

In total, Dyer said the city is planning five housing projects downtown that could add 1,500 bedrooms to the area.

“What requires a great downtown is housing,” Dyer said. “If we’re going to continue with vibrancy downtown, it cannot be 8 a.m. to 5 p.m., Monday through Friday, supported by government employees.”