Legislative Democrats Begin the Process of Passing a $131 Billion Budget

On June 12, Democrats begin the process of sending a budget to Gov. Jerry Brown.

The Assembly Budget Committee has scheduled a hearing – the lower house says it can be watched or listened to here — to discuss the “Legislature’s plan,” which the committee says differs from the revised budget the Democratic governor unveiled in May by “less than 1 percent in total spending.”

Democrats control both houses of the Legislature so the spending blueprint is their creation and, since only a majority vote is required for passage, the proposal neither needs support from GOP lawmakers nor is likely to receive it.

The Democrats’ plan relies on “difficult ongoing cuts and temporary voter-approved revenues to create a responsible on-time budget that eliminates California’s structural budget deficit,” the Assembly Budget Committee says.

Democrats bank on voter approval of Brown’s November ballot measure to increase taxes on the state’s higher earners and boost the sales tax by one-fourth of one percent.

Of the Democratic-majority’s spending plan to close an estimated $15.7 billion gap between spending commitments and revenues, nearly $6 billion would come from higher taxes which would last for four years in the case of the sales tax and seven years for income tax.

The proposal also includes cuts that would be automatically triggered if voters fail to pass the ballot measure.

By far the heaviest victim of those cuts is public schools whose support from the state would fall by $5.5 billion.

To accommodate the cut, districts would be allowed to reduce the school year by 15 days. As a way to cope with previous budget cuts, schools are already allowed to reduce the academic year by five days.

The University of California and the California State University system would each face reductions of $250 million if Brown’s tax plan fails at the polls.

Brown proposed a $1 billion reserve – Democratic lawmakers cut it down to $614 million, reducing the required amount of spending cuts needed to balance the budget by $434 million.

Democratic lawmakers did not cut as deeply as Brown proposed in CalWORKs, the state’s welfare system, or Medi-Cal, the state’s health care program for the poor.

They did embrace a modified version of Brown’s plan to place persons eligible for both Medi-Cal and Medicare into managed care plans to coordinate their care. Democrats predict initial savings of $611 million from the move.

A copayment of $15 will be required for non-emergency visits to hospital rooms and from Medi-Cal recipients to save $20 million. The idea needs approval by the federal government.

The plan says it “reduces compensation for state employees by an average of 5 percent” to save $839 million, although only $402 million of the total aids the cash-starved general fund.

Democrats rejected Brown’s plan to eliminate the Commission on the Status of Women but, the budget committee says, adopted “reforms.”

Among those “reforms” is changing the name to the Commission on the Status of Women and Girls and “focusing its studies and advocacy on issues such as gender equity in education and business and women veterans and their families.”

Spending in both Brown and the legislative Democrats’ budget is more than $131 billion, roughly $91 billion coming from the general fund.

The commission’s annual budget is $267,000. 



Filed under: Budget and Economy

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