Critical Vote Coming on State Budget




Within the next few days the Legislature is reportedly going to be challenged to vote on a proposed state budget, one that reflects the Governor’s latest proposal along with modifications made by various legislative committees. The package to be voted upon will include the proposal to place temporary tax increases on the ballot for the public to consider. Most predictions are that the necessary Republican votes to approve this proposal will not be there, with the result being no budget.

Much has changed since the Governor introduced his first proposed budget in January that forecast a $ 26 billion State deficit. The Legislature has enacted legislation to cut over $ 13 billion in state programs, and the Governor signed that into law. That took care of approximately half of the State deficit. The economy has picked up, producing more state revenue than anticipated, further reducing the State deficit and benefiting public education. The Republicans have defeated the Governors’ proposals to eliminate redevelopment agencies and move their money to the State treasury, which would help further reduce the deficit. And, at least one lawsuit has been filed to legally challenge the Governor’s plan to confiscate $1 billion of First Five money to the benefit of the State General Fund. The Governor’s May budget revise reflects these budget deficit reductions and seems to give up on the redevelopment agency and First Five money shift ideas.

Some of the Governors’ realignment proposals, shifting programs to the counties along with a revenue source, still have political support but others do not. The State Legislative Analyst has reversed field on at least one proposal – shifting child welfare (child abuse intervention) to the counties 100%, saying the program is too complex with too many federal controls and performance requirements to make it manageable if 58 counties each had their own version of the program. The reality is that the Feds hold states responsible for this program and are not interested in trying to deal directly with 58 counties, so California could probably not get away with this kind of shift anyway.

The latest polls seem to indicate that even if the Legislature did approve the budget package about to be before it, the public would defeat the proposed tax increases at the ballot box. This news raises the question of why, then, try that move?

I have a predication. That is that the Governor will back off on his tax increase proposal, allowing the Democratic controlled Legislature to adopt a budget without any Republican votes and send it to him for signature. It will, to some extent, kick the can down the road with some bookkeeping and borrowing gimmicks, as has been the case for the last several years. The reasons given for doing it this way will include the already enacted budget cuts, the improving revenue picture, and the lack of public support for more tax increases. An unstated reason will be that the Governor will be able to avoid giving Republicans one thing they want in exchange for a budget vote – significant reform of the state pension system.

About Over But Not Out

A retired Orange County employee, and moderate Republican. The editor seriously does not know OBNO's identity as did not the former editor, but his point of view is obviously interesting and valued.