An improving budget situation

On May 13, Governor Brown released his revised budget proposals, based on revenues received during the first quarter of 2014. The release of the “May Revise” has become an eagerly awaited yearly ritual in the Capitol, one that seldom fails to generate controversy.

This year, California’s financial picture is improving. Revenues are up approximately $2.4 billion, but unanticipated increases in Medi-Cal and other health costs related to the implementation of Obamacare will consume an additional $1.2 billion. The Governor wants to increase education spending by about $300 million, with much of the increase going toward unfunded liabilities in the State Teachers Retirement fund.

A bi-partisan agreement has been reached to create a rainy day fund, subject to voter approval, with long-term plans to begin paying down the $340 billion in unfunded mandates we have largely been ignoring. Obviously, with this huge amount of debt looming on the horizon, an improving revenue picture does not mean the Legislature can return to its old spending habits.

Fortunately, the Governor has also recognized the “temporary” taxes included in Prop. 30, passed by voters in 2012, are really temporary. This year’s financial windfall, based on a shaky economic recovery and temporary taxes, simply will not last. It is never prudent to spend one-time money creating new programs that will ultimately put the state back into an even deeper financial hole. Hopefully, the Legislature has learned its lesson; we can’t tax, spend and borrow our way to financial solvency. That road leads to ruin.

By Calif. State Assemblymember Marie Waldron (R-75th District)

3 Responses to "An improving budget situation"

  1. grunt   June 5, 2014 at 8:24 pm

    $1.2 billion (after Obamacare) $350 billion in debt, revenues to decrease after the temporary tax increase, and he commits $300 million in new spending. The only way out of debt is to decrease spending. In two-three years we will be in a negative revenue-spending problem, again. We, the people, must start electing people who will make the hard decisions and reduce the overall spending – not just reduce the increase, as is the norm, nor continue new spending,

    Reply
  2. Robin Leigh   June 9, 2014 at 9:37 am

    When a state has the short fall CA does and is driving businesses and people out by the droves how long do you honestly think it’s going to take before the entire state tanks?! Many municipalities here are in serious trouble; We are the state of choice among illegal aliens who are draining the coffers dry (with complicit co-operation from the state government) and NO companies are looking to open their doors there which would expand the employment base. Not only are the personal and business taxes prohibitive, regulations and bureaucracy for employers are onerous. Yes, CA is a beautiful state…to VISIT…not to work or live. And the residents here will soon discover just how unsustainable their policies and politics have made it so…and it’s entirely self-inflicted!

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  3. California Dreaming   June 12, 2014 at 6:59 pm

    Marie Waldron is truly a breath of fresh air. I think she is one of the very few politicians that really is honest about what needs to happen.

    Reply

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