California Gov. Gavin Newsom has proposed a $322 billion budget without a deficit, a welcome change after two years of significant budget shortfalls in the nation's most populous state.

But the budget Newsom announced Monday is mostly a placeholder as California waits to see if incoming President Donald Trump will follow through on threats to revoke billions in federal dollars, which could force lawmakers to make painful cuts to essential programs.

California will not have a budget deficit next year, Gov. Gavin Newsom announced on Monday based on projections from his finance team. The budget picture Newsom describes is a major turnaround from the $47 billion deficit last year and the $32 billion shortfall the year before.