Brown preps California budget revision amid tighter revenue

By Jonathan J. Cooper

SACRAMENTO (AP) — As Gov. Jerry Brown prepares to release his revised state budget this week, he's hearing a chorus of calls from Democratic lawmakers, liberal interest groups and even some Republicans urging him to significantly boost spending to help California's poorest residents.

Brown's budget comes after tax collections in April, the state's biggest revenue month, fell $1 billion short of expectations and cast uncertainty on what the state can afford.

The governor is required to release his budget by Saturday. He then hands the process over to lawmakers who have a month to mold their own spending plan by June 15.

In January, Brown proposed a $122.6 billion spending plan that avoided sweeping new initiatives or substantial increases in ongoing programs, even as the state saw a revenue spike thanks to an improving economy.

Instead, warning that a recession may be imminent, Brown urged spending the surplus revenue to rehab state buildings and pre-fund employee retirement benefits — costs that can more easily be curtailed if revenue plummets. He also wanted to set aside an extra $2 billion in a rainy-day fund.

"It would be short-sighted in the extreme to now embark upon a host of new spending only to see massive cuts when the next recession hits," Brown told lawmakers then.

By law, about half the state's spending goes to K-12 education and higher education. One of every $5 in Brown's January budget went to health care, and 9 percent was for prisons.

The state has already committed to about $1 billion in new spending since January. Much of it was part of an agreement to modify health insurance taxes to fund Medi-Cal, the publicly funded health plan for the poor. The agreement included promises to boost funding for developmental disability services and save money for future health care costs for retired state workers.

Other new costs include raising the minimum wage by 50 cents Jan. 1 on its way to $15 by 2022, which will cost $3.6 billion annually once fully implemented. New state-worker contracts also will cost more than planned after the administration made labor concessions to corrections officers that it's likely to match for other union bargaining units.

Despite the governor's reluctance to bless new ongoing costs, legislative Democrats are pushing several initiatives to help people they say continue to struggle through the economic recovery.

"We're very focused on assuring that people get access to food, people get access to shelter, and much of the devastation that was done in 2008 gets slowly repaired," said Assemblyman Phil Ting, D-San Francisco, who heads the Assembly Budget Committee.

The Senate wants $2 billion to build more than 10,000 permanent housing units for the homeless. The money would come from Proposition 63, a 2004 ballot measure that increased taxes on the wealthy to pay for mental health treatment.

Democrats are also pushing to repeal the maximum family grant in CalWorks, which prevents families from getting additional welfare benefits if they have another child while receiving state assistance.

The legislative women's caucus is seeking $800 million to increase childcare provider rates and offer care to more families. Advocacy group Parent Voices says 194,000 children are waiting for child care.

"California is one of the most expensive states in the country, so I want to be able to provide for them," said Vaea Sanft, 31, a father of two from East Palo Alto who joined hundreds of parents rallying for childcare funding last week in Sacramento.

Republicans have their own budget ideas, though they face long odds in a Legislature dominated by Democrats.

The top legislative Republicans sent Brown a letter asking him to prioritize funding for Denti-Cal, a dental program for people with low incomes. State watchdogs have said the program pays so little that many dentists won't participate.

GOP lawmakers also have proposed a variety of tax breaks they say would make California more affordable.

"We're trying to put the money where it's going to be used efficiently and effectively," said Sen. Mike Morrell, R-Rancho Cucamonga.