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May Budget Revise

This year’s May Budget Revise was introduced with little fanfare from the Democratic Party or much backlash from the Republicans.  Senate Majority Leader Bob Huff used phrases like “I am glad to see”, “I appreciate”, and "the Governor has been pretty responsible” in his press release.  And while it is nice to see Governor Brown has made fiscal responsibility a priority in his budgeting, as Senator Huff does point out, the reason the Governor can do this is the tens of billions in increased temporary tax dollars the taxpayers voted to send Sacramento.

The Revise reflects spending just over $2 billion above what was laid out in the January budget.  The additional dollars are going to emergency drought relief, meeting the Prop 98 funding guarantee, more help for In-Home Supportive Services, additional contributions for CalPERS, and more staffing for our unemployment insurance program.

It also give additional monies to implementing the Federal Health Care Reform, which will cost the state an additional $1.2 Billion over what was laid out in the January budget.  The state will see a 46 percent increase in Medi-Cal enrollment for 2014-15 taking the percentage of the state’s population that is covered to 30 percent. 

OCTax applauds the creation of a rainy day fund that will actually be used for future roller coaster revenue cycles.  But managing dollars is just one aspect of governance.  What California needs is leadership that will look beyond simply budgeting.  We cannot continue to rely on the volatility of capital gains and at the same time have members of the state legislature compete with each other to see who can introduce the bill most likely to drive businesses and taxpayers out of our state.

By Carolyn Cavecche, President & CEO of Orange County Taxpayers Association

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