Brown wants to complete budget in 60 days, predicts cuts to education

Source: LA Times

Brown wants to complete budget in 60 days, predicts cuts to education

Gov.-elect Jerry Brown said Tuesday that he wants to complete a budget agreement within two months, an accelerated timeline that would allow a late-spring special election for potential tax increases or other revenue generation.

“I’m going to try to get the budget agreements done within about 60 days. I don’t think we have a lot of time to waste,” he said.

It's unclear whether the 60 days begins now, when he takes office on Jan. 3 or when he unveils his budget. Brown made the remark during a budget forum in Los Angeles, but he demurred when asked by reporters after the forum whether his proposal would contain only spending cuts or whether it would include new taxes.

“We’ll present a budget on Jan. 10. It will be a very tough budget but it will be transparent,” Brown told reporters after hosting a forum about the state’s budget crises. “We’ll lay it out as best I can. We’ve been living in fantasy land. It is much worse than I thought. I’m shocked.”

Brown laid out the timeline during his second budget forum, which was focused on education. Brown and other state officials painted a bleak picture for educators, saying that despite his view that education is a pillar of civilized society, the state’s deep fiscal problems and $28-billion budget gap means there will be more reductions in California’s classrooms.

“This is a really a huge challenge, unprecedented in my lifetime,” Brown told hundreds of educators, union representatives and parents who had gathered at UCLA. “I can’t promise you there won’t be more cuts because there will be.”

California’s K-12 system has been battered by billions of dollars of cuts in recent years, resulting in widespread teacher layoffs, the overcrowding of the classroom, the shortening of the school year and the elimination of many courses and extracurricular programs. Community colleges have eliminated courses and are turning students away. Students in the UC and Cal State systems have seen sharp fee increases.

“These last three years have been terrible,” said Tom Torlakson, the incoming state superintendent of public instruction.

Under the financial picture painted by Brown and other state officials, these conditions are likely to get worse. The state is facing a $28-billion budget gap for the next 18 months, and $20-billion deficits through the 2015-16 fiscal year. With education making up roughly 40% of state funding, much of these cuts will likely come from the state’s schools.

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Read more: http://latimesblogs.latimes.com/california-politics/2010/12/brown-wants-to-complete-budget-in-60-days-predicts-cuts-to-education.html

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Elsewhere, the Democratic treasurer "jokes" about 25% across-the-board cuts.

Alaska and Texas tax for drilling, why can't we? And what about the corporate property tax giveaway with prop-13? Shouldn't that be given a looksee?

Why must the balance sheet always focus on expenses with absolutely no attention to revenues?

I voted for him and I have higher expectations. FYI.

other than the oil companies put huge amounts of money into ads to convince people it would not be a good idea - research 2006 election

Chevron is negoTiating a lease right now for the Richmond Refinery.

Amazing that ads still work in this day and age.

why don't you wait until he attains office before slamming him? i'm sure jerry is going over EVERYTHING with a fine-tooth comb. GAS destroyed us, just like *ush did for the US. let's wait and see how he does.

Why not just call me a hater and be done with it.

you "had higher expectations". that comment denotes past actions, hence my remark.

Jerry Brown will need to work with the attorney general to get some justice for the State of California.

The only glass food or beverage container exempt from recycle taxes, and there are more than a few hitting the trash cans and dumpsters every night.

Hell, the taxes on mine alone could probably pay for a kid's education.

Sonoman

My city's recycling program gladly takes wine bottles, both in the weekly curbside pickups and at their drop-off center. So do the commercial recycling centers I've been to in San Jose. They're just glass. Or do you mean the state should add a fee to wine bottles like it does to soda cans?

(A local winery used to let you bring your own bottles for refilling. I think they stopped after the original owner died.)

he can't change the past and he can't budget on future increases until he can get them.

he knows better than most that Californians have been voting in favor of services and against tax increases (and methods of making tax increases possible through majority votes). thus he likely knows that to pass and maintain any tax increases, he's going to have to sway voters to seeing the wisdom of reformulating our method of revenue collection in this state.

furthermore, there is a basic structural problem in California when it comes to revenue and spending:

1) Property Taxes are based on 1% base assessed upon one's purchase price (the year you bought it or 1977, whichever is later) plus no more than 2% per year. As everyone knows, inflation runs more than 2% per year most years. This also applies to commercial properties which change owners far less frequently. Property taxes can and do get reduced when assessed valuation drops but unlike increases, there is no 2% cap in reductions. The county without me asking, reduced my property taxes last year by about 25% in accordance with my massive loss in property value. So this most stable form of revenue for the State is declining overall because of the way Prop. 13 has left it's structure.

2) Income Taxes: for many middle and upper middle class workers, the rate is 9.3% per year. An increase above that is not likely. To be fair, California's rate is highly progressive so that rate only applies to people's last dollars, not most of the dollars that are earned before that. Still, income taxes, volatile, subject to the whims of the economy are not able to raise necessary funds during economic downturns.

3) Sales Taxes: this is one tax that has gone up in recent years and though it's raised some money, it is not even a third of our shortfall.

4) Legislative challenges: While the legislature is far from impressive, much of their ability to affect the budget has been taken from them by voters. Voters have continually approved measures to direct particular revenue streams to those items alone (e.g. gas taxes generally must to go to transportation, etc.). Also, many parts of government operate off fees that their operations impose and those fees fund those operations only. Thus, the legislature is limited to a small part of the budget that is solely funded by the general fund. The general fund is composed of revenue collected that has not already been sent back to the counties for their state mandated programs. During low revenue years, the legislature has little ability, even if they had the will, to alter these basic metrics, especially with a Republican governor and a 2/3rds requirement to pass a budget. With the 2/3rds gone and Brown elected, they will have more power but that alone still won't take care of it.

Why? Fixing this can't be done with a 1% increase here and there. There's a budget calculator online about this where you can adjust all the tax rates and tax policies (many/most require voter, not just legislative approval). Doing almost all the usual revenue enhancements still leaves us with a terrible budget situation.

Thus, to shore up public education without giving up California's social safety net completely will require a new approach to revenue collection, across the board and the changes are so big, that they will require societal support for such big changes as well as the time to phase them in (remember "BIG").

An idea I had was to attempt to enact the changes by equalization district. Currently the state is broken up into regional equalization districts (revenue districts). There are several throughout the state, representing regions. Because it's been impossible to get consensus on big budget changes throughout the state, I think that each equalization district could form its own revenue and spending policies, with the State legislature setting an overall minimum. However, the Bay Area's region would likely support major changes to school funding and taxation and could potentially support a very progressive agenda. If they could do it within their region, they could have the gov't they want because they are willing to fund it. Other areas don't seem to want that model so they would fund less and do less. I think this is more politically palatable to voters than to politicians. The dirty little secret is that wealthy areas support less wealthy areas and the less wealthy areas (not necessarily poor) say they want less government services, however, they don't realize how much they receive. Nevertheless, a ballot initiative that allows several regions in the state to decide their own model of revenue and spending is politically very sale-able. The representatives, however, know how the money flows and might oppose it...but they'll have to lie to to stop it because telling the truth doesn't fit the narrative that anti-taxers like to hear.

We'll see what Brown actually proposes. I think my idea is a winner.

But Brown's got his work cut out for him, but he's imaginative, he's very grounded in realism. He's also totally uninterested in demagoging issues, so I have some hope that he can facilitate voter support of fundamental changes to state operations.

I can hope. :)

I hope everyone sends their ideas to Brown.

I am very glad to see that he is moving fast on this.
I do not believe that he'll disappoint those who put him in office.

I can only hope, too. CA is too good to waste, and a place I love.

Another person I am watching is Kitzhaber of Oregon --- to see if he comes up with anything novel.
He, too, seems to be moving fast.

I forget which Democratic governor up there proposed massive cuts to state services or a tax increase. The tax increase lost and services were cut substantially.

This is the danger of just putting out a tax increase without some sort of strategy for getting it passed.

If memory serves Kitzhaber proposed this back in 2002? Maybe it was Kulongowski who followed him but I'm not sure.

Thanks for the kind words! :hi:

There has to be something to cut besides education. The schools out here are so terrible, I dont understand how they expect any children in this state to grow up to be competent adults. K-12 is crap and then college is too expensive. Nobody wants to acknowledge the long term problems of having massively uneducated youth population. I shudder to think what the schools must be like down in parts of the valley. I'm in the suburbs outside LA where the schools are supposedly great, sadly that's bullshit and even in some of the most wealthy areas in the state , the schools are in really rough shape.

I work with young moms, adjudicated youth, 17 y.o.'s reading on the first grade level, or second; and with seniors getting ready to leave h.s. who can barely write a sentence or read a web page---these kids have had a horrible education in the Nation's Capital, where they have access to the best museums in the world and seeing government at work (or not). I used to be shocked but no more, this is education business as usual.

it's gonna be ugly. we've already been warned. at least this time we can feel confident that we aren't being SCREWED, like with GAS.

i'm retiring in 9 days....maybe it's time to leave my home state for someplace with a lower standard of living. i'm liking oregon and washington.

differ! From my experience, I believe they have a higher standard of living than California, but a lower cost of living.

they do definitely have a great standard of living and no state taxes!