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Gov. Brown's Latest Budget Plan: More Cuts

The governor proposed steep budget cuts to make up for the state's $16 million budget shortfall.

Gov. Jerry Brown proposed steep cuts across a variety of programs Monday to close a nearly $16 billion state budget deficit, but Los Angeles Unified School District and university officials said the impact on their budgets will remain unknown until November, when voters weigh in on proposed tax hikes.

"We're going to have to cut deeper," the Democratic governor said in Sacramento while releasing his budget revision.

"But cutting alone really doesn't do it," Brown said. "That's why I'm linking these serious budget reductions—real increased austerity—with a plea to the voters: Please increase taxes temporarily on the most affluent and everyone else with a quarter of a cent sales tax."

Brown said the state's budget deficit ballooned to $15.7 billion since January, when it was estimated at about $9.2 billion. His revised budget includes billions of dollars in cuts—including a proposed four-day work week for some state employees that would reduce them to 38 hours and allow some offices to be closed once a week. There are also proposed cuts in home-care funding and Medi-Cal payments.

Funding for schools and the state's two major university systems will remain in question, however, until the November election, when Brown asks voters to approve a bump in the state's 7.25 percent sales tax rate to 7.5 percent, and to increase the income tax rate on people earning more than $250,000 a year.

If the proposals fail, another $6 billion in cuts will take effect Jan. 1—much of them impacting education.

"This makes all the numbers in the budget dependent on an election that has not happened yet, and thus makes final local budget decisions, extremely difficult if not impossible," LAUSD Superintendent John Deasy said.

"If the measure passes, this will give schools some badly needed funds that have been promised over the past several years. If voters do not pass the initiative, the results are so catastrophic it is simply untenable."

The California State University and University of California systems would each face another $250 million cut in their budgets—likely meaning more program cuts and tuition hikes.

"We very much appreciate the governor's hard work to avoid further direct cuts to higher education despite the steep growth in the size of the state deficit," said Charles Reed, chancellor of the Long Beach based CSU system. "Nevertheless, all Californians should be concerned about the serious long-term damage to student access to the California State University that is posed by the $250 million trigger cut.

"Combined with last year's $750 million cut, no easy options remain," he said.

"It will be extremely difficult to avoid impacts to program quality at our 23 campuses or impacts to access for students and the ability to servethem, with long-term consequences for workforce development and job growth in the state."

Steve Montiel, spokesman for the UC president's office, also said officials there appreciate Brown's effort to maintain funding for the system, but the financial picture for the universities will remain in doubt until November.

"We will continue to seek a long-term funding agreement with the state that will provide the stable fiscal footing needed to preserve the university's quality, access and affordability," he said.

Assembly Speaker John Perez, D-Los Angeles, said Brown's budget proposal "makes clear that a significant budget problem remains."

"We will continue to work with the governor and the Senate to close the remaining budget problem, which will require the Legislature making tough cuts and the voters approving temporary revenues," Perez said. "... Through an open and transparent process, we will craft an on-time, balanced budget by June 15."

Sen. Bob Huff, R-Diamond Bar, said the ballooning state budget was predictable given the spending plan that was approved by the Democratic legislature last year. 

"As state revenues have been increasing, total spending has also increased by $20 billion since the 2007-08 state budget," Huff said. "... Despite an 11 percent unemployment rate, 2 million Californians out of work and California being ranked the worst state in the nation to do business eight years in a row, the governor and Democrats have no proposals to help grow the economy or to help our small business community.

"Republicans believe we must get people back to work, which in turn will responsibly increase our state tax revenues," he said.

Los Angeles County Chief Executive Officer William Fujioka said the governor's latest spending plan was still being reviewed to see how it will impact county programs. He noted, however, that the county has seen more than $1.4 billion in state funding cuts over the past four fiscal years.

"The biggest state budget impact to Los Angeles County, by far, continues to be the shift in responsibility for certain public safety and health-related programs from the state to counties, which was part of last year's budget," Fujioka said. "How these programs are funded, both in this budget and in future budgets, remains a major unresolved issue for our county."

CLaude Todoroff May 15, 2012 at 05:57 PM
Voters plead with Jerry Brown - Please cut your spending and the anti-business climate in California. All they are trying to do is stall long enough is to get the 2/3 super majority in the state legislature so they can pass any and all tax increases. That's why we need to elect Craig Huey in AD66. He understands the problems the state is facing and what to do about it. Please attend the Huey Townhall on May 21st. at the Katy Geissert Library in Torrance.
Ray Waters May 15, 2012 at 07:28 PM
Remember, taxes are the price we pay for civilization. The continued concentration of wealth in the hands of a few will eventually end in disaster for our country. We want better government, then we must pay for it. The wealthy are benefiting the most from deductions and high incomes have certainly have gained the most over the past generation. Craig Huey is typical of those who have benefited so much from the tax structure. Certainly he wants to protect his income by preventing any change that would damage his privileged status.
Steve Hemingway May 15, 2012 at 11:19 PM
There is no example of thrifty and effective spending by any aspect or branch of government -- ever. Our economy was designed around limited government and low taxation. As long as taxes remained a small slice of a large (economic) pie, the system was sustainable. With high taxation and regulation, Industries are fleeing to China and nearly 50 million Americans are presently on food stamps. No matter if you are Dem or Rep, there will be no money for government services no matter how humanitarian. Wake up and smell the joblessness. Taxes are now taking a larger slice of an ever shrinking pie. Have you taught your kids Mandarin yet?
Tom F. May 15, 2012 at 11:46 PM
How many people from third world countries can we afford to invite to join our "civilization?" How can we pay for all of the social services when the number of people on them is limitless? Our young citizens of all heritages are losing jobs to non-citizens and then end up on welfare. Solve the immigration problem, then come back and ask for more money. I totally understand why these people come, and I'd do the same if I was in their shoes, but that doesn't mean that us taxpayers can, or should, support the damage that they do by coming.
jim McGee May 17, 2012 at 05:41 AM
Ray Waters, where do you think this "Concentration of Wealth" is? Is it hidden under the mattress? We have seen that socialism doesn't work and that is apparent in what is happening in EU today.

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