State Starts Fiscal Year with A Budget in Place — For a Change

On the last day of the fiscal year, Gov. Jerry Brown signed a $120 billion spending plan that he and his fellow Democrats say reduced the state’s chronic ongoing gap between revenues and spending commitments by 75 percent.

The spending blueprint also largely holds state spending on public schools at last year’s levels although some $2.1  billion in payments from the state are deferred.

Last year’s budget agreement wasn’t reached until a record 100 days into the fiscal year.

Brown vetoed some $270 million in spending, most of it relating to transportation and outside the state’s cash-starved general fund.

“The 2011 budget act makes substantial progress in reducing (the state’s annual) deficit through the combination of ongoing spending reductions and an improved revenue outlook,” Brown’s budget summary says.

“Despite eliminating most of the structural deficit, the state continues to face major long-term challenges and must address the remaining structural problem.”

Overall, more than 55 percent of the budget gap the Democratic governor now estimates at $27.2 billion was closed by $15 billion in spending reductions.

Nearly $1 billion in fees were increased – including a boost in annual vehicle registration fees of $12.

The remaining $8.3 billion of the budget solution came from what Brown calls “improvement in the state’s revenue outlook.”

Since he announced his revised budget in may, the state has taken in more than $1.2 billion more than expected in sales, income and bank and corporations tax receipts.

Brown believes by the end of the fiscal year beginning July 1, revenues will be a total of $4 billion more than estimated in May.

If not, the budget contains a series of $2.5 billion in triggered spending reductions, nearly $1.8 billion coming from public schools.

Just over 1 cent of the state’s share of sales tax is transferred to local governments to pay for the transfer of a variety of public safety tasks from the state to counties.

Included is incarcerating non-violent state inmates in county jails and giving counties the responsibility for handling parole violators.

-30-