It's all phony math.
Approving Billions in Cuts to Social Services, California Reaches a Budget Deal
By JENNIFER MEDINA
LOS ANGELES — Just 10 days before the start of the new fiscal year, Gov. Jerry Brown and the Democratic-controlled Legislature reached a budget deal on Thursday to close a nearly $16 billion budget gap. The agreement came after days of negotiations, with legislative leaders reluctant to make the cuts that Governor Brown said were urgently needed.
That the budget met its deadline for only the third time in the last two decades was seen as a cause for celebration, though the spending plan hardly contained good news.
And even more cuts loom on the horizon if voters do not approve Governor Brown's proposed tax increase, which will be placed before them in November. Besides an array of immediate cuts, the budget includes $6 billion in trigger cuts, coming primarily from the state's education system, if voters do not back the tax measure.
The cuts already in the deal rely on limiting eligibility for welfare and other changes to social services programs. The deal will put a 24-month limit on the state's welfare program, although it allows for some exceptions in counties with high unemployment. It also cuts the number of spaces available in state-subsidized child-care programs.
"This agreement strongly positions the state to withstand the economic challenges and uncertainties ahead," Governor Brown said in a statement. "We have restructured and downsized our prison system, moved government closer to the people, made billions in difficult cuts, and now the Legislature is poised to make even more difficult cuts and permanently reform welfare."
The Legislature is expected to vote on the deal next week.
Under the governor's tax proposal, the state would receive $6.9 billion in taxes from an increase in sales tax to 7.75 percent, up from 7.5 percent, and a surcharge on income tax for those earning more than $250,000 a year. If voters reject the plan, an additional $6 billion will be carved out of the budget next January, primarily from the state's primary schools and higher education system.
But Mr. Brown's tax plan will have to compete with a rival tax increase proposal backed by the state's Parent Teacher Association, which would use the revenue to send more money to public schools.
Last year, the Legislature passed an optimistic budget plan and later had to cut nearly $1 billion when the revenue did not come in as expected. Then, in May, Governor Brown announced that the state's budget gap had grown to $16 billion, rather than the $9 billion his administration had projected in January.
Optimistic revenue projections have troubled the Legislature for the last several years, as the state has grappled with a financial crisis of a seriousness not seen since the Great Depression. When Mr. Brown took office last year, he pledged not to rely on gimmicks that many had criticized the Legislature for using in the past.
"As always, the negotiations were tough," Darrell Steinberg, the State Senate leader, said in a statement. "But we move forward together with a state budget that's structurally balanced, setting us on the path to putting this nagging deficit behind us."
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