ARTICLE
The past few months have been quite horrifying for California with wicked wild fires burning thousands of acres in northern and southern California leaving communities reeling to find ways to rebuild. The fires have left our California hillsides scarred in ashes and thousands of homes and structures destroyed. Then, almost exactly as predicted, Mother Nature unleashes the first heavy rains of 2018. They have marred a neighborhood where, as of yesterday morning, 300 people were stranded in their homes in Montecito’s Romero Canyon neighborhood. Closer to Santa Cruz in Monterey County, parts of Highway 1 are impassable again. This follows the rains from last winter which was the wettest year in memory for our region. This article is not about the weather conditions or climate change, but the looming economics for our state. Governor Brown and the State Department of Finance have released the 2018-19 budget. It shows some remarkable economic growth in December, but also cautions. “California has faced ten recessions since World War II and we must prepare for the eleventh. Yes, we have had some very good years and program spending has increased steadily,” said Governor Brown in his budget letter to the Legislature. “Let’s not blow it now.” Keeping the state on a path to long-term fiscal stability, Governor Edmund G. Brown Jr. today proposed a $131.7 billion General Fund budget plan for 2018-19 that fills the state’s Rainy Day Fund to its constitutional target, fully implements the state’s K-12 school funding formula two years ahead of schedule and provides $4.6 billion for the first year of a 10-year transportation improvement plan. In stark contrast to the $27 billion budget gap of 2011, the 2018 fiscal plan reflects a healthy one-time surplus and increases funding for education, health care and other core priorities. With growing uncertainty about the impacts of new federal policies, combined with a longer-than-average economic expansion, the budget continues to bank higher revenues into reserves and pay down debts and liabilities. State Controller Betty T. Yee reported today, “As the governor’s Department of Finance released its proposed 2018-19 budget, California’s total revenues of $16.25 billion for December were $2.79 billion above June’s budget expectations.” “I can sum up the governor’s budget in one word: smart. The federal tax measure did not just stick it to California’s individual taxpayers — it also likely will have a devastating impact on our state budget, which may mean less money for essential social services such as Medi-Cal, Medicare, and the children’s health insurance program,” said Controller Yee, the state’s chief fiscal officer. “We are not going to know for months just how deep the wounds will be from the president’s massive giveaway, so until we do, Governor Brown is once again wise in exercising caution with responsible short-term spending, boosting rainy day fund reserves, and paying down debt.” What do the local elected officials think about this budget? Assemblymember Mark Stone, D-Monterey Bay: “I am cautiously optimistic about the Governor’s proposed budget. I’m pleased that the proposal includes investments in public education, as well as funding increases to community colleges, the CSU, and the UC higher education systems. Additionally, as the Chair of the Assembly Judiciary Committee, I am hopeful that budget negotiations will produce equal access to justice in the courts. I look forward to working with the Governor, my colleagues, and other stakeholders to ensure that the budget helps Santa Cruz residents and all Californians.” Let’s hope the rainy winter season brings us the right amount of snow and water without disrupting our economy that requires additional state and federal funds to flow in to emergency repairs for floods, fires and other natural disasters. The budget process will move through the state legislature over the next few months and the unknowns about what is happening in Washington DC will be clear as to the impact they have on our state’s budget decisions. Stay tuned as in any election year, politics can play spoiler to making sound fiscal policy decisions.
The past few months have been quite horrifying for California with wicked wild fires burning thousands of acres in northern and southern California leaving communities reeling to find ways to rebuild.
The fires have left our California hillsides scarred in ashes and thousands of homes and structures destroyed. Then, almost exactly as predicted, Mother Nature unleashes the first heavy rains of 2018. They have marred a neighborhood where, as of yesterday morning, 300 people were stranded in their homes in Montecito’s Romero Canyon neighborhood. Closer to Santa Cruz in Monterey County, parts of Highway 1 are impassable again. This follows the rains from last winter which was the wettest year in memory for our region.
This article is not about the weather conditions or climate change, but the looming economics for our state. Governor Brown and the State Department of Finance have released the 2018-19 budget. It shows some remarkable economic growth in December, but also cautions.
“California has faced ten recessions since World War II and we must prepare for the eleventh. Yes, we have had some very good years and program spending has increased steadily,” said Governor Brown in his budget letter to the Legislature. “Let’s not blow it now.”
Keeping the state on a path to long-term fiscal stability, Governor Edmund G. Brown Jr. today proposed a $131.7 billion General Fund budget plan for 2018-19 that fills the state’s Rainy Day Fund to its constitutional target, fully implements the state’s K-12 school funding formula two years ahead of schedule and provides $4.6 billion for the first year of a 10-year transportation improvement plan.
In stark contrast to the $27 billion budget gap of 2011, the 2018 fiscal plan reflects a healthy one-time surplus and increases funding for education, health care and other core priorities.
With growing uncertainty about the impacts of new federal policies, combined with a longer-than-average economic expansion, the budget continues to bank higher revenues into reserves and pay down debts and liabilities.
State Controller Betty T. Yee reported today, “As the governor’s Department of Finance released its proposed 2018-19 budget, California’s total revenues of $16.25 billion for December were $2.79 billion above June’s budget expectations.”
“I can sum up the governor’s budget in one word: smart. The federal tax measure did not just stick it to California’s individual taxpayers — it also likely will have a devastating impact on our state budget, which may mean less money for essential social services such as Medi-Cal, Medicare, and the children’s health insurance program,” said Controller Yee, the state’s chief fiscal officer. “We are not going to know for months just how deep the wounds will be from the president’s massive giveaway, so until we do, Governor Brown is once again wise in exercising caution with responsible short-term spending, boosting rainy day fund reserves, and paying down debt.”
What do the local elected officials think about this budget? Assemblymember Mark Stone, D-Monterey Bay: “I am cautiously optimistic about the Governor’s proposed budget. I’m pleased that the proposal includes investments in public education, as well as funding increases to community colleges, the CSU, and the UC higher education systems. Additionally, as the Chair of the Assembly Judiciary Committee, I am hopeful that budget negotiations will produce equal access to justice in the courts. I look forward to working with the Governor, my colleagues, and other stakeholders to ensure that the budget helps Santa Cruz residents and all Californians.”
Let’s hope the rainy winter season brings us the right amount of snow and water without disrupting our economy that requires additional state and federal funds to flow in to emergency repairs for floods, fires and other natural disasters.
The budget process will move through the state legislature over the next few months and the unknowns about what is happening in Washington DC will be clear as to the impact they have on our state’s budget decisions. Stay tuned as in any election year, politics can play spoiler to making sound fiscal policy decisions.