Dan Walters

Dan Walters

Dan Walters: Real budget numbers way higher than politicians let on

Published: Wednesday, Jan. 16, 2013 - 12:00 am | Page 3A
Last Modified: Tuesday, Feb. 26, 2013 - 8:16 pm

When Capitol politicians and others talk or write about "the budget," they are referring to the "general fund," which Gov. Jerry Brown proposes to be a bit over $97 billion in the next fiscal year.

However, that's never been the entire budget.

Whenever it's passed by the Legislature, it also includes "special funds," as well as "bond funds" and federal funds. And there's been so much recent jockeying on how the state keeps its books that referring merely to the general fund as the budget is not only incomplete, but downright misleading to the voting and taxpaying public.

The tendency has been to shift expenditures from the general fund to new special funds and that has the effect – intended or coincidental – of flattening out general fund numbers and thus making the growth of state spending look smaller than it has been.

One big shift illustrates the point.

Brown and legislators adopted what they called "realignment," shifting responsibility for parole, low-level felons and some social and health services from the state to counties, along with a chunk of the state sales tax, amounting to more than $5 billion a year, to pay for them.

The tax shift was ratified by voters last year as part of Proposition 30, Brown's sales and income tax measure. The shifted revenue was removed from the general fund and routed through a new special fund.

Prison spending dropped a bit in the general fund to $8.8 billion, according to Brown's new budget, but through the tax shift, the state is spending another $2.3 billion on felons, so total spending on "corrections and rehabilitation" has risen sharply to $11.1 billion.

Likewise, while the new general fund budget would spend $2.5 billion on what it calls "legislative, judicial, executive," special funds account for another $2.6 billion, mostly for the courts, and the total for the category, including bonds for new courthouses, reaches $5.4 billion.

And so it goes.

We used to think of special funds as primarily highways and fish and game, but they total more than $40 billion in the new budget. And with $7.2 billion in bond spending, the total reaches $145.8 billion.

But wait, as the TV pitchman says, there's more.

The budget package now before the Legislature would also spend about $80 billion in federal funds, mostly for health and welfare services and education, so the real budget is more like $225 billion, which is the equivalent of 10 percent-plus of the state's economic output.

Moreover, a truly complete budget would also include tens of billions of dollars in "tax expenditures," or what most of us would call loopholes.

It's misleading to talk about a budget that's just a fraction of the real total, and it's high time that the governor, legislators and others frame it more fully and accurately.

© Copyright The Sacramento Bee. All rights reserved.

Read more articles by Dan Walters

Dan Walters, political columnist

Dan Walters

Dan Walters has been a journalist for more than a half-century, spending all but a few of those years working for California newspapers. At one point in his career, at age 22, he was the nation's youngest daily newspaper editor.

He joined The Sacramento Union's Capitol bureau in 1975, just as Jerry Brown began his first governorship, and later became the Union's Capitol bureau chief. In 1981, Walters began writing the state's only daily newspaper column devoted to California political, economic and social events and, in 1984, he and the column moved to The Sacramento Bee. He has written more than 7,500 columns about California and its politics and his column now appears in dozens of California newspapers.

Email: dwalters@sacbee.com
Phone: 916-321-1195
Twitter: @WaltersBee

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