Legislature Passes Democrats’ Budget Plan, Sends it to Brown
On Tuesday night, California's Legislature passed an eight-bill budget package that closed the state's $9.6 billion deficit just days before the July 1 start of the new fiscal year, the San Francisco Chronicle reports. Gov. Jerry Brown (D) is expected to approve the plan.
The plan relies on an assumption that the state will receive $4 billion in higher-than-expected revenue in the new fiscal year. If the revenue fails to materialize, the budget legislation would trigger deeper cuts to health programs and other services (Buchanan/Lagos, San Francisco Chronicle, 6/29).
In March, Brown signed budget bills that included deep cuts to education and health and human services. He initially sought to close the remaining deficit by imposing additional cuts and holding a special election on taxes. However, Republicans refused to support the tax plan.
Democrats then crafted an alternative budget package that left out the tax measures, allowing them to pass their plan with a simple majority vote. Brown vetoed the plan one day after its passage, saying the package contained "legally questionable maneuvers, costly borrowing and unrealistic savings."
Soon after, state Controller John Chiang (D) announced that he would withhold legislators' pay because an analysis by his office determined that their spending plan was not balanced. A spokesperson for Chiang said lawmakers will start receiving pay again if Brown signs the new budget and the Department of Finance finds it balanced (California Healthline, 6/28).
Details of Newly Passed Plan
Democrats used a simple majority vote to pass the newÂ budget package (Siders, Sacramento Bee, 6/29). No Republicans voted in favor of the measures (Harmon, Contra Costa Times, 6/28). The budget plan does not incorporate the spending cap, pension reforms or other regulatory changes sought by Republicans.
TheÂ package alsoÂ does not include new taxes. However, itÂ would imposeÂ additional spending reductions, including $450 million in unspecified cuts to health programs (San Francisco Chronicle, 6/29).
In addition, if the expected $4 billion in extra revenue does not materialize by the end of the year, the budget package would trigger $2.5 billion in additional spending cuts (Contra Costa Times, 6/28). The additional reductions would target health and human services programs, libraries, prisons and universities (Goldmacher, Los Angeles Times, 6/29).
Some GOP members said the optimistic revenue assumptions prove that Brown's earlier tax proposals were unnecessary.
Sen. Robert Huff (R-Diamond Bar) said, "If we now have the revenue that we needed at the beginning of the year, why is it we keep going back to the voters and asking for yet more?" (Contra Costa Times, 6/28).
Jim Nielsen (R-Gerber), vice chair of the Assembly Budget Committee, said he is doubtful that the extra $4 billion in revenue will materialize. Nielsen added that the newly passed plan is "woefully short" on reforms (San Francisco Chronicle, 6/29).
Headlines and links to editorials on the newly passed budget plan are provided below.
- "New State Budget a Return to Fantasyland" (Contra Costa Times, 6/28).
- "California's Grand Budget Bargain That Wasn't" (Los Angeles Times, 6/29).
- "Budget Balanced With Dubious Fees, Hope" (Orange County Register, 6/28).
- "Budget Resolution Is More Bitter Than Sweet" (Sacramento Bee, 6/28).
- "State's 'Honest Budget' is Tilting at Windfalls" (San Francisco Chronicle, 6/29).
- "Voters Need To Know Final Budget Offers From Both Sides" (San Jose Mercury News, 6/29).
- "Budget of Expectations" (Santa Cruz Sentinel, 6/28).
Headlines and links to broadcast coverage on California's budget situation are provided below.
- "California's New Budget Deal Relies on Strong Economy, $4 Billion in Extra Income" (Chiotakis, "Marketplace," American Public Media, 6/28).
- "Gov. Brown To Sign Pared-Down Calif. Budget Deal" (Myers, "Morning Edition," NPR, 6/29).
- "Governor Plans To Sign Budget" (Myers, "The California Report," KQED, 6/28).
- "California Budget Projects $4 Billion More Revenue; Sets Automatic Cuts if Money Falls Short" (Small, "KPCC News," KPCC, 6/28).
- "California Lawmakers Pass $86 Billion Budget" (Small, "KPCC News," KPCC, 6/28).