Dan Walters

Dan Walters: How much is California really spending?

Gov. Jerry Brown released his revised budget plan for the fiscal year that began July 1st on Thursday, May 15, 2015 in Sacramento, Calif.
Gov. Jerry Brown released his revised budget plan for the fiscal year that began July 1st on Thursday, May 15, 2015 in Sacramento, Calif. rpench@sacbee.com

It’s time again for some more fun with numbers – big numbers.

They’re the numbers associated with the 2015-16 state budget, which the Legislature and Gov. Jerry Brown enacted last month.

There may be some public confusion over its dimensions. Some news media reported the total as $115.4 billion, others as $167.6 billion.

Both are correct as far as they go. The state’s general fund budget is $115.4 billion, but the second number, $167.6 billion, includes $45.7 billion in special fund spending (such as highway construction and maintenance, financed largely from gas taxes) and another $6.5 billion in bond funds.

Neither number, however, fully explains the enacted budget because it also contains nearly $100 billion in federal aid that will flow through the state, primarily for health and welfare services and K-12 education. That brings the total to $265 billion.

Yet there’s even more when off-budget spending is included.

The budget’s $14.6 billion for higher education covers just the state’s contribution, not spending from tens of billions of dollars in student tuition, research grants and other revenue collected by the University of California and the California State University system. The state covers scarcely 10 percent of UC’s $26 billion budget, for instance.

Nor does the budget include pensions paid to retirees by state pension trust funds, including the California Public Employees’ Retirement System and the California State Teachers’ Retirement System. Payouts total about $30 billion a year, according to Census Bureau data.

And then there’s that little item called “realignment.”

A few years ago, the governor and the Legislature shifted operational control of several health and welfare programs and criminal justice functions to county governments.

The latter responded to pressure from federal judges to reduce overcrowding in prisons. The state diverted newly convicted felons deemed to be nonthreatening to county jails and probation systems, and began releasing state inmates meeting the same criteria to local control.

These shifts now cost well over $7 billion a year, and the state gave counties a share of sales taxes and other revenues to pay for them, which – on paper – reduced state spending. So a real comparison of current spending with that of past years must also take realignment shifts into account.

By the way, even though the state’s prison population has dropped by a third in the last few years to meet judges’ demands, spending on “corrections” has actually increased to well over $11 billion a year.

So how much money will the state, including its colleges and pension funds and realignment, really spend in the 2015-16 fiscal year that began July 1?

A reasonable estimate would be $350 billion, equivalent to a sixth of the state’s economic output and over twice the official budget number of $167.6 billion.

The real question, of course, is whether we’re getting our money’s worth. But that cannot be calculated mathematically.