Governor Jerry Brown shared some news Californians aren’t used to hearing: the state’s deficit is gone. The governor announced Jan. 10 that he was proposing a balanced state budget and lauded sacrifices in the past two years he said have led to a “healthier financial trajectory.” The governor, however, did make it clear that, while the deficit might have been erased, a “mountain of debt” still remains. The 2011-2012 and 2012-2013 budgets provided three dollars of spending cuts for every dollar in temporary tax revenues approved by the voters in November 2012 via Proposition 30.
The governor’s projections are at odds with a report from the Legislative Analyst’s Office, which stipulated that despite revenue from Proposition 30, the state still faces a $1.9 billion shortfall. Brown is therefore massaging his balanced budget figures with a healthy dose of optimism.
Brown’s plan calls for a small increase in education funding, with an increase in state funding for UC and CSU by an additional $250 million. Also, funding for K-12 and community colleges increases by $2.7 billion next year, and by $19 billion by 2016-2017. In terms of education, Brown stated, “This is real investment. The money is going in under new conditions. We’re investing in schools, but we’re doing so in the context of local flexibility and local control.”
Funding for social service programs will not be restored, but the budget increases local assistance realignment grants from $24 million to $27.5 million in FY 2013-14. Brown noted that by end of 2016 the state could potentially reduce its debt to less than $5 billion. He maintains he’s focused on the importance of the state living within its means and wants to advance a “progressive agenda that is consistent with the money that is available.”
“Fiscal discipline is not the enemy of democratic governance, but rather its fundamental predicate,” he said in a statement to the media.
As to that “mountain of debt,” as of this week, according to the U.S. Debt Clock, the state’s debt was at $427 billion, with a debt-to-GDP ratio of 20.5%. The state is legally obligated to pay billions of dollars withheld from schools, local governments and healthcare providers as lawmakers struggled repeatedly to balance the books, though deferral payments to education have basically been written off by the governor.
It also owes Wall Street for bonds sold to balance the budget. Sacramento has also racked up tremendous debt for retiree pensions and healthcare, now totaling more than taxpayers spend each year on all state programs combined.
When he released his budget plan, Brown presented a timeline for repaying nearly $28 billion the state owes to government programs that it raided for cash or deprived of funds over the years, as well as. Payments of $4.2 billion would be made in the budget year that begins in July. Subsequent payments, growing to as much as $7.3 billion a year, would continue into 2017. What happens to rest of the debt remains to be seen.
State takes aim with new gun laws
In addition to President Barack Obama’s recent 23 executive orders and proposals to revamp the nation’s gun laws at the federal level, state lawmakers are also locking and loading. California consistently ranks as having the most restrictive gun laws in the United States, but in the wake of the slayings on Dec. 14, 2012, at the Sandy Hook Elementary School in Newtown, Conn., state Treasurer Bill Lockyer has called on the state’s public employee retirement programs, which wield enormous investment power, to examine their holdings and divest in companies that make guns, particularly assault-style weapons, that are illegal in California.
Gun rights advocates say leaders are overreacting. New restrictions, they say, would not affect criminal behavior but would only make it more difficult for law-abiding gun owners to exercise their Second Amendment rights.
Sen. Kevin de León (D-Los Angeles) wants to introduce a bill to require annual permits ranging from $25 to $50 for anyone who wants to buy any type of ammunition available. Applicants for permits would have to be at least 18 years old and undergo a background check.
State Sen. Leland Yee (D-San Francisco), plans to introduce three gun-related measures: banning a feature on magazines that technically classifies them as non-detachable; requiring firearms to be stored with a trigger lock and in a locked case; and requiring annual registration and background checks for gun buyers.
Democrats aren’t the only one with gun plans. State Sen. Ted Gaines, (R-Roseville), wants a lifetime ban on gun ownership for anyone deemed by a court to be dangerous because of a mental disorder or illness. Current law allows for such people to petition a court for the ability to possess a gun after treatment.
Locally, Eastern Sierra Armory owner-operator Clayton Mendel said, “For the first time I am genuinely worried about what ill conceived and poorly written legislation they’ll be pushing through as a kneejerk reaction.” –San Bernardino County Sun/San Francisco Gate