http://www.sacbee.com/content/politics/story/14057606p-14888764c.html
Gov. Arnold Schwarzenegger today proposed a $125.6 billion state budget that would use a windfall of new tax revenue to increase school funding and pay back debt.
The governor's spending plan for the fiscal year that begins July 1 marks a departure from his first two budgets, which emphasized austerity. Because of a robust economy, the Department of Finance expects the state to end the current fiscal year with billions of dollars more than expected.
"This budget continues California on the path toward fiscal responsibility and economic recovery," Schwarzenegger said.
But even with the good economic news, the governor proposed cuts for social programs, including a decrease in welfare funds that counties were already slated to get this year.
In his budget, about 8 percent larger than last year's, Schwarzenegger recommended a $4.3 billion hike in education funding, including $1.67 billion to pay back money borrowed to help balance the budget in 2004.
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GAAS:021:06
FOR IMMEDIATE RELEASE
01/10/2006
Governor Schwarzenegger's Budget Continues Fiscal Responsibility and Prepares for Strategic Growth Plan
Budget Adds $4.3 billion to Education, Special Attention to Children's Health Care
Days after outlining a Strategic Growth Plan for California in his State of the State address, Governor Arnold Schwarzenegger today released his state budget that will pave the way for the plan's investments in critical infrastructure while maintaining the fiscal discipline that has helped foster the state's economic recovery.
"This budget continues California on a path toward fiscal responsibility and economic recovery," Governor Schwarzenegger said. "This budget does not raise taxes, it continues to pay down our inherited debt, it puts gas tax revenue into roads and highways where it belongs, it makes critical investments in our schools, children's health care and emergency preparedness, and it cuts the structural deficit by more than two-thirds from when I took office - from $16.5 billion down to $4.7 billion."
California has added 440,000 new jobs since the Governor took office, spurred on by reforms in workers compensation, tax relief to vehicle owners, the curbing of frivolous litigation and holding the line against tax increases. This economic recovery and the spending control the Governor has exercised in earlier budgets have produced additional revenues the state can use to increase investment in education and health care.
"We have made tremendous progress toward eliminating the structural deficit," the Governor added, "and at the same time we are protecting local government, protecting education and health care, and not raising taxes.
"We will continue to lower the deficit this year by repeating what worked so well last year: taking some of our one-time revenues and using them for one-time purposes." The Governor's budget includes pre-paying $920 million in loans from the Prop 42 transportation account that is due next year, an early repayment of nearly $500 million toward what was borrowed under Proposition 57, and fully funding the Budget Stabilization Account as required under Proposition 58.
This fiscal responsibility and continued progress in addressing the state's structural deficit paves the way for California to address another critical need - planning for the future and renewing investment in the state's system of infrastructure. Governor Schwarzenegger outlined his Strategic Growth Plan in last week's State of the State address and the budget he released today prepares California to begin to implement it.
The Governor noted that the state's economic recovery has produced additional revenue and, as a result, "we can also focus on the things that are important to California families. Like education."
"K-14 education funding will increase by $4.3 billion, an increase of $660 per student, bringing total per pupil spending to nearly $11,000," announced the Governor. "But it is not just the amount of money that is important. It is about how that money is spent. This budget focuses on the quality of education in our classrooms."
The Governor's budget proposes that California restore art, music and physical education to our schools. It focuses on teacher training and recruiting math and science teachers, and for the first time, it provides $428 million dollars to fully fund Proposition 49, the After-School Education and Safety Act, as required by the voters. "This will make California the only state in the nation to offer comprehensive after-school programs," the Governor said.
The Governor's budget also provides funds for the following high priorities:
- Providing sufficient funding to eliminate student fee increases scheduled for this fall at the University of California, Hastings School of Law, and the California State University. In addition, the budget reflects no fee increases at California Community Colleges, and increases Cal Grant resources for students attending private institutions.
- Fully funding the second year of the Governor's Compact with Higher Education.
- Fully funding Proposition 42, and making early repayment on a prior-year loan from Proposition 42, for a total of more than $2 billion for improvements to California roads, bridges, and highways.
- Fully funding health and human services caseload increases, and expanding funding for Healthy Families and MediCal to cover more children.
- Providing more than $20 million in public safety initiatives to combat gang violence, methamphetamine production, sexual assault, and financial and identity crimes.
- Establishing a Statewide Emergency Preparedness Initiative to enhance the state's ability to respond rapidly to a natural or man-made disaster.
- Addressing climate change, air pollution, and other environmental priorities.
"This budget will make people's lives better, today and tomorrow," the Governor concluded. "It continues our efforts to restore fiscal integrity to California, it focuses on improving the quality of education and health care for our children, and it continues to build our critical infrastructure as we plan for our future."
The Governor's $125.6 billion budget plan for the 2006-07 fiscal year, which includes $97.9 billion in proposed General Fund spending, is available on the Department of Finance's Web site at http://govbud.dof.ca.gov/.
REMINDER: Link here to the briefing paper issued on the Governor's Strategic Growth Plan. Please note the Existing Funding Section of Attachment 1 under the heading "Existing and New Funding Sources, Transportation and Air Quality" has been updated for State and Federal Fuel Excise Tax and Weight Fees and Proposition 42. In addition, page 11 of the main document contains clarification of the telemedicine funding for UC.
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Any fool on the street knows of the R.E. boom in the last year (& increase in "assessed" tax base).
For those in state government to not have anticipated additional revenue clearly demonstrates incompetence.
(Denny Crane: "I Don't Want To Socialize With A Pinko Liberal Democrat Commie. Say What You Like About Republicans. We Stick To Our Convictions. Even When We Know We're Dead Wrong.")
Almost $8B in proposed fees, reducing General Fund expenditures buy about the same percentage.
The 2006-2007 budget proposal from the governor includes $97.9 billion in general fund spending and $25 billion in spending from special funds...
Where is the other 3 billion?
General Fund 97.9
Special Funds 25.0
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122.9