Jerry Brown: California avoided budget deficit through cuts, new taxes
It’s March, and the Capitol’s occupants have dived into a new state budget, beginning with program-by-program perusals by the Legislature’s budget subcommittees.
Gov. Jerry Brown unveiled his proposed 2017-18 budget two months ago, and since then its “stakeholders” have been assessing its impact and formulating strategies to improve their shares of the pie.
The size of the pie is one issue. The ever-cautious Brown, concerned – or perhaps paranoid – about leaving the budget in the black when he departs two years hence, takes a glass-half-empty view, citing slowing revenue growth. However, the Legislature’s budget analyst, Mac Taylor, believes there will be several billion more dollars.
The dispute will be settled, more or less, when hard numbers emerge after the April 18 income tax filing deadline, but even if there is more, there are obvious conflicts between Brown, who wants to hold down spending and build reserves, and legislative leaders, who want more health and social services spending.
Speaking of which, there’s no universal agreement on the size of the budget.
Brown pegs the “General Fund” budget at $122.5 billion and $179.5 billion if special funds, such as those spent on highways, and bonds are included. But that’s less than half of the true budget, which includes federal funds – especially those for health and welfare services – and such things as the fees on college students and pension checks to retired public employees.
All in, spending totals $421.6 billion, although that figure doesn’t appear anywhere in the budget. One must add up 12 different budget categories to get the total, which is about $11,000 per Californian and equivalent to nearly 20 percent of the state’s economy.
K-12 education is the biggest commitment of state taxes. At $81 billion, including a smattering of federal funds, it would spend more than $13,000 for each of the state’s 6.2 million students – a new number for the perennial debate over where California stands, vis-à-vis other states, in school spending.
Higher education is also very large at $55.1 billion, but much of that comes from student fees and other non-tax income. The University of California’s budget, for example, is $32.8 billion but state taxpayers contribute just $3.5 billion.
Polls indicate that most voters believe prisons and parole are the biggest budget item, but in fact they consume a relatively small $11.3 billion.
The largest category is the $154.5 billion for health and welfare services, especially the $105.2 billion Medi-Cal program of health care for the poor that now covers more than a third of the 39 million Californians, but costs the general fund just $19.6 billion.
The disparity explains why California politicians are very concerned about the fate of the Affordable Care Act and other federal health funds now that Republicans control Washington.
Although the budget assumes that the state will receive more than $100 billion in federal funds, no one really knows what President Donald Trump and Congress will do in the next year – including themselves.