Should California spend or save its budget boon?

The guv says put California's savings under the mattress, but dems are hot to drop

Greg Lucas' state-politics column Capitol Lowdown appears every other week in SN&R. He also blogs at

Without choices, decision-making is easy. Options complicate.

This year, for the first time in a decade, California has several unexpected billions in the treasury. Pretty awesome compared to $60 billion in the red just three years ago.

“Extra” money means the annual budget bump-and-grind, which commences this month, will be messy.

Just how messy will be fully revealed within the next week or so when Gov. Jerry Brown unveils his updated budget plan. But, as of today, the Democratic governor and lawmakers appear to have at least $4 billion to play with.

“Appear” being the most important word in that sentence.

Brown’s first two budgets attempted to close $15 billion and $26 billion shortfalls. They were passed on time because Democrats had no choice except to cut. To justify their aye votes, Democrats said:

“This sucks on an epic level, totally thrashes lower-income Californians and further hobbles halt and lame oldsters, but, like, what else could we do, bro?”

No sucking in 2013. Happy days have returned to the Capitol. But this brighter day for state policymakers is the result of it being a gloomier year for California taxpayers.

Thanks to voter approval of Proposition 30 last fall, every Californian is paying a quarter-of-a-cent more in sales tax. Another new $5 billion was expected to show up in April because of the higher income taxes Proposition 30 imposes on the fewer than 550,000 Californians earning $250,000 or more.

The state also received $5 billion more than it expected in income-tax payments in January, not usually a banner month. That created such cushy a cushion that Brown’s Department of Finance reported California began April—its largest revenue collection month of the year—with nearly $5 billion more in the bank than predicted.

All of which would appear to create plenty of the aforementioned messiness.

Democratic legislators are soiling themselves with excitement over spending this money on all manner of worthy programs that were sharply curtailed during the years the treasury was bare. Preventative health care for poor kids and their families. Aid to the blind and disabled. In-home assistance for the elderly infirm. The courts. All very righteous candidates for a cash infusion.

Except even though there’s plenty of Democratic votes in the Legislature to authorize a financial airlift to all of these entities, Brown doesn’t want to go there.

Says H.D. Palmer, finance department spokesman, “We’re channeling our inner Larry David: Curb your enthusiasm. Just because we’re over forecast at this time doesn’t mean that’s free money people can spend however they want.”

While the Initialed One’s remarks represent a pretty harsh buzzkill for Democratic lawmakers, there’s some wisdom to the Brown administration’s hesitancy. State bean counters can’t explain the January revenue spike. Does a January feast this year mean forced fiscal fasting in the next budget year?

Then again, all spending options but one might be eliminated and the whole mess cleaned up because of something voters did 25 years ago.

That’s when Proposition 98 was approved. It requires a minimum annual amount of state investment in public schools—about 40 cents of every buck the state receives. But like so many things in politics, it’s not that simple.

Prop. 98’s formulas say that if there are large spikes in income for the state—like this year—and if the state has been shorting schools—as it surely has—then Sacramento’s fiscal freebooters might need to fork over every penny in unexpected cash to atone for a scintilla or two of past sins.

Boy, what a waste that would be. Squandering billions on public schools, whose graduates help create a smarter, nimbler workforce that, in turn, increases California’s creativity and productivity, stokes the Golden State’s economic engine and sends more tax revenues to Sacramento that can be spent to help make things a bit more golden for everyone.

How stupid can voters be?