Dan Walters

Opinion: Brown tries to hold line on spending

The election is over, the Legislature will soon reconvene and interest groups are starting to beat their drums – signals that the Capitol will soon begin its annual spasm of Darwinian combat known as the state budget.

Gov. Jerry Brown, of course, is the main player and he and his fiscal advisers will soon finalize a proposed 2015-16 budget for the Legislature.

It’s a proposal that will be affected by Proposition 2, which voters, at Brown’s behest, passed this month, creating a new rainy-day fund that would partially cushion the budget from future economic and revenue downturns.

The Legislature’s budget analyst, Mac Taylor, said this week that with revenue running above estimates in this fiscal year, the state could end up next June with more than $4 billion in reserve, but with half of it locked up by Proposition 2.

That would, as Brown intends, temper ambitions for new spending, but there’s an even greater curb on spending the expected revenue surge next year, Taylor says, and it’s another ballot measure, Proposition 98, passed in 1988.

That constitutional law dictates how schools are to be financed, and Taylor says that under its provisions, K-12 schools and community colleges will be entitled to “virtually all of these higher revenues” not soaked up by Proposition 2.

That would suit Brown just fine, because he publicly and privately has discouraged budget stakeholders and their legislative allies from seeking big spending increases.

He argues that spending restraint, debt repayment and reserves should prevail because another recession will inevitably strike the state, and he points to the passage of Proposition 2 and his own landslide re-election as signs of public support for prudence.

As Taylor was issuing his report Wednesday, Brown drove his position home to the University of California by opposing UC President Janet Napolitano’s somewhat extortionate proposal to increase tuition if UC doesn’t get more state aid.

Brown told Napolitano and his fellow regents, in essence, that they have enough money to operate and need to do a better job of spending it.

They ignored him and approved the tuition hike, indicating that what should be a fairly easy budget process, given rising revenue, won’t be friction-free.

The university’s plaint that it absorbed big support cuts during years of recession and revenue declines and now should get some relief is being echoed by other major spending stakeholders, particularly advocates of health and welfare services for the poor.

Brown has not been particularly receptive to their pleas, either, at one point saying he wanted permanent retrenchment in the array of services.

Entering his final term and hoping to leave state finances in the black as a legacy, Brown is even less susceptible to pressure from spending advocates.

Call The Bee’s Dan Walters, (916) 321-1195. Back columns, sacbee.com/dan-walters. Follow him on Twitter @WaltersBee.