Gov. Jerry Brown’s revised budget proposal, released Thursday, contains too much spending and not enough fiscal discipline.
The proposal calls for $124 billion in spending from the general fund, and $183.4 billion in total state expenditures. Though this would be a slight 1.4 percent increase from last year’s general fund budget, it nevertheless represents record spending levels.
“Over the past four years, we have increased spending by billions of dollars for education, health care, child care and other anti-poverty programs. In the coming year, I don’t think even more spending will be possible,” Brown said in a press release. “We have ongoing pressures from Washington and an economic recovery that won’t last forever.”
“Make no doubt about it, cuts are coming in the next few years, and they’ll be big,” Brown added later at a news conference.
Brown deserves credit for taking some measures in recent years to build up rainy-day funds, pay down the “wall of debt” he identified and push some pension reforms, though even these have been modest steps. Dealing with a spendthrift Democratic majority in the Legislature may have diluted some of these efforts.
Changes since Brown’s initial budget proposal in January include adding in the first $2.8 billion of the 10-year, $54 billion gas tax hikes passed last month, providing $400 million of the $600 million additional annual cost to counties stemming from the end of a state health care program, restoring rate increases to child care providers that the previous proposal had planned to postpone for a year, and providing another $6.5 million to the Justice Department to fight the Trump administration over sanctuary cities and other issues.
Under the proposal, K-14 education funding would increase by $3.2 billion over last year, for a total increase of $27.3 billion (58 percent) since fiscal year 2012-13. Yet, has the quality of education increased by 58 percent over the past six years?
Bright spots in the governor’s budget proposal include a much-needed $6 billion supplemental payment to the California Public Employees’ Retirement System and a boost in the state’s rainy-day fund, from $6.7 billion last year to $8.5 billion — which would be about two-thirds of the way to the constitutional goal of 10 percent of tax revenues.
And though the governor’s budget projects a relatively small $400 million deficit, it is incredible that there is any deficit at all, given all of the tax increases Californians and the Legislature have passed in recent years (and still more tax/fee increase and bond proposals on the horizon).
Brown’s concerns over the next inevitable economic correction come just one day after State Controller Betty Yee issued a warning over a shortfall in state revenue.
“April is usually the state’s biggest tax filing month, so lower-than-expected personal income tax receipts are troubling,” Yee said in a statement. “[T]his is another signal that we may…