Brown outlines priorities in final California budget
Jan 14 2018
Wednesday proposed a $131.7 billion General Fund budget plan for 2018-19 that fills the state's Rainy Day Fund to its constitutional target, fully implements the state's K-12 school funding formula two years ahead of schedule and provides $4.6 billion for the first year of a 10-year transportation improvement plan.
California Governor Jerry Brown speaks with Chinese Minister of Science and Technology Wan Gang (not pictured) during their meeting ahead of the Clean Energy Ministerial global forum in Beijing on June 6, 2017.
The state receives 70% of its revenue from income taxes and half of that comes from the top 1%, making the state dependent on capital gains earned in the stock market and resulting in huge revenue swings, Brown said.
But now Brown and his administration want special treatment - the same favor that was bestowed upon Republican-led Florida earlier this week, when Secretary of the Interior Ryan Zinke announced that the Sunshine State would be exempt from a new policy proposal to open oil and gas drilling and exploration on the Outer Continental Shelf. The sole way of preparing is to observing your spending amount each year and accumulates the emergency fund.
"Whether that investment manifests as paying down pension obligations, continuing to combat the housing crisis or saving more in the rainy day fund, it is crucial that we use this opportunity to help solidify our state's financially solvent future", he said.
Brown has focused much of his second stint as governor on stabilizing the state's long-term budgeting during a period of fiscal prosperity.
Brown doesn't reflect any changes to federal tax law in his budget plan, which he finalized in mid-December before Congress passed its tax overhaul.
"If it were to pass, it would be a blow to California's economy", Brown said of the repeal drive.
"There is a lot more flexibility than is now assumed by those who discuss the California rule", Brown said.
The proposed budget now moves on to state lawmakers who have until June 25th to approve a spending plan.
The famously frugal governor noted a "healthy one-time surplus" in his budget, but warns that the state "faces uncertain times, including the ramification of the recently enacted federal tax bill".
It's a far cry from the dire budget he faced when he took office eight years ago, when the Great Recession had hobbled general fund revenue by $15 billion, compelling budget cuts and furloughs for state workers.
The Legislature's Democratic majorities have signaled that they think some of the surplus should be used to bolster social programs, particularly those for the very poor.
Another goal includes providing more funding for education.
Asked about how his spending priorities over the past seven years might affect his legacy, Brown deflected.
The governor's budget assumes next year's fire season will be typical.
One of these critical services, Dodd said, was education.
State senate leader Kevin de León introduced legislation last week that would allow California taxpayers to donate to a fund and deduct 100% of the donation, essentially turning state tax payments into a deductible charitable contribution.
Such a change would likely need to be reflected in the state budget, even though it's meant to be revenue neutral.
In 2015-2016, 43 percent of the state's more than 2 million community college students qualified for free tuition as low-income students through a fee waiver now called the California College Promise Grant.
The Legislative Analyst's Office projects general fund revenue of $135 billion for the upcoming budget year, nearly $40 billion more than the state collected eight years ago.