California Governor Jerry Brown proposed a budget for the 2018-19 fiscal year on Wednesday that would be a 5 percent increase over the current year, with greater spending on education and transportation, while he warned about a likely a economic downturn in the future.
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 worldwide forum in Beijing on June 6, 2017.
As for state deficits, they generally arise when states project high future spending growth even when revenues are stagnating.
Sens. Kevin de León, the state Senate leader, and Holly Mitchell, the Senate budget committee chairwoman, also lauded Brown's budget as financially responsible, but suggested they wanted to see increased funding for education, child care and poverty reduction programs. The sole way of preparing is to observing your spending amount each year and accumulates the emergency fund.
Brown's budget would place $2.3 billion into an operating reserve fund in addition to the money going into the rainy day fund.
"Fortunately, we haven't hit that recession yet, but we will", Brown told reporters to explain why he wants to use the extra money mostly to fatten the state's "rainy day" reserve, raising it to $13.5 billion.
The minimum guarantee of funding for K-14 schools in 2007-08 was $56.6 billion and dropped to $47.3 billion in 2011-12 at the peak of the state budget crisis.
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.
"My Senate Republican colleagues and I are advocating for a pragmatic "2-2-2" framework that ensures the surplus will not be squandered on spending we can not afford", Republican Leader Patricia Bates (R-Laguna Niguel) said in a statement.
Including special funds and bonds, which are pools of restricted money that can only be used for specific projects, total proposed spending next fiscal year is $190.3 billion.
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Gov. Brown also announced $26.7 million for a voluntary home visiting pilot program for young, first-time parents in the CalWORKs program, California's version of the federal Temporary Assistance for Needy Families (TANF) program.
This budget takes into account the passage of Senate Bill 1, the gas tax, which it says will provide $55 billion in new transportation funding over the next 10 years, split equally between state and local projects.
Still, both pension funds are considered seriously underfunded because they owe tens of billions of dollars more in benefits than they have on hand.
Asked about how his spending priorities over the past seven years might affect his legacy, Brown deflected.
Furthermore, as Brown was reminded by one of Wednesday's reportorial questioners, the Democrats vying to succeed him this year have been courting liberal voters by promising all sorts of new and expensive programs if elected, largely mirroring what Democratic legislators want.
One of these critical services, Dodd said, was education.
The governor's budget assumes next year's fire season will be typical. They could then deduct that from their federal tax bill. The plan had its first hearing Wednesday and would allow taxpayers to give a charitable contribution to the state's coffers in lieu of paying taxes.
Personal income taxes came in 25% higher at $11 billion in December.
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.