Some Likely Victims in Gov. Jerry Brown’s Revised Budget

On May 16, Gov. Jerry Brown will present a revised budget plan that he insists will be balanced.

That means after $11.2 billion in spending decreases approved by lawmakers and signed into law by Brown in March, a $15.4 billion hole remains using the Democratic governor’s estimate of the gap between the state’s spending commitments and revenues of $26.6 billion.

State tax collections – income, sales and bank and corporations – are roughly $2 billion above Brown’s January estimate, shrinking the hole to $13.4 billion.

How will that hole be filled?

Brown is mum but it seems likely that at least $2.3 billion will come from public schools.

Brown’s January budget noted that under the formulas governing state support of public schools, kindergarten through Grade 12 spending could be reduced by $2.3 billion.

The Democratic governor chose not to do so, saying schools had taken the brunt of prior year budget reductions.

Brown and lawmakers decided in March to postpone $5.2 billion in payments owed school to future fiscal years but mandated that no more than $2.5 billion could be outstanding at one time.

Rather than cut deeper into school funding, Brown might propose some additional deferrals in his updated budget.

He also could eliminate the bounty program the state operates to encourage schools to have smaller class sizes. That would save an additional $1.2 billion

Currently, many districts do not have the money – even with the state payment – to afford the smaller classes.

Representing 8.3 percent of the budget over which the state has control, the California State University system and the University of California would also see reductions.

Brown has said higher education would face reductions in an “all-cuts” budget but not how much.

In a February letter to Sen. Mark Leno, a San Francisco Democrat, the Legislative Analyst offered a variety of possible reductions for higher education totaling just over $900 million.

Among them reducing UC and CSU personnel costs — $408 million, cut state support for research in half to save $134 million and reduce the money sent to UC and CSU this year by half, a $316 million savings. Brown has said the analyst’s proposals are “one path” but not necessarily his own.

The State Treasurer’s Office has projected the effects of an all cuts budget over time.

Over the next five years, public school funding suffers the most, losing 4.4 percent. The portion of the budget devoted to state prisons would shrink by 2.4 percent over the same period while the cost of paying off the state’s debt would rise.

The largest shift would be a 5.2 percent increase in the costs of Medi-Cal, the state’s health care system for the poor.

(Source: Office of the Treasurer)




Filed under: Budget and Economy

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