SACRAMENTO, Calif. (KTXL) — Gov. Gavin Newsom is set to unveil his state budget proposal later this week.

Meanwhile, at the State Capitol, budget negotiations are underway. Several city leaders from across the state are urging the legislature and governor to approve funds for recycling and housing program. They also said the state owes them money.

“We’re asking the state to put its money where its mandates are,” said Carolyn Coleman, League of California Cities CEO.

The League of California Cities called on state leaders to use $1.6 billion of the state’s estimated $68 billion budget surplus for a list of what they say are necessities.

The group on Wednesday said first on the list is $500 million to create a housing and economic development program to help finance housing production and incentivize development across California.

“We’re asking the state to do something simple: partner with our cities so we can make real progress toward our housing production goals,” said Cindy Silva, Walnut Creek mayor pro tem.

Next on the list is payback.

The group said the state owes local governments across California more than $933.5 million for state-mandated programs dating back to 2004. About half of that money is owed to cities.

“Cities have carried out dozens of mandated programs and services such as those related to public meetings, identity theft, domestic violence, child abuse, and crime reports,” said Roberto Uranga, Long Beach City Council member. 

Lastly, the group is asking for $180 million to help cities set up another state-mandated program: organic waste recycling. The state regulations went into effect at the beginning of this year.

They said the state funding already provided for this was hardly enough.

“Without additional funding, many cities will be forced to pass on a significant cost of these programs to taxpayers at a time when they can least afford it,” said Gabriel Quinto, El Cerrito mayor.

 Newsom is set to release his revised version of the state budget on Friday.