The Legislature is finalizing a proposed spending plan that’s roughly $2 billion higher than Brown’s $115 billion spending plan. The increase is based on upbeat revenue assumptions from a nonpartisan budget analyst.
The California Commission on Teacher Credentialing issued 11,497 new credentials in 2013-14, down 30 percent from four years earlier, and enrollments in collegiate teacher-preparation programs have declined by 75 percent in the last decade.
The decision late last week by the State Water Resources Control Board upends a delicate compromise made weeks ago by environmental regulators, farmers and others as California struggles to cope with the fourth year of drought. For the next 10 days, water releases from Shasta will be lower than expected.
The fine for that “infraction” is $250, but when you write a check to pay the ticket you will learn that the Legislature and other authorities have added a raft of surcharges for various purposes to all traffic offenses, from courthouse construction to DNA testing and emergency medical services.
These are hard times for the blue-state governing model of high taxes and public unions—see Illinois, Connecticut and Maryland. But our friends on the left ignore these states and tout California as their real model, as Sacramento celebrates record tax revenue. So it’s worth noting that the Golden State may be repeating the fiscal mistakes it made before its last economic bust.
The proposal is a response to the “maturing” of a CalPERS system that soon will have more retirees than active workers. From two active workers for each retiree in 2002, the ratio fell to 1.45 to one by 2012 and is expected to be 0.8 to 0.6 to one in the next decades.
More than likely, therefore, the EITC will evolve into an “entitlement” that will expand to ever-more recipients. That’s been the history of such benefits, even those deemed to be temporary or non-entitlements when first implemented.
Tesla Motors Inc., SolarCity Corp. and Space Exploration Technologies Corp., known as SpaceX, together have benefited from an estimated $4.9 billion in government support, according to data compiled by The Times. The figure underscores a common theme running through his emerging empire: a public-private financing model underpinning long-shot start-ups.
Marin officials echoed the approach of state officials, who quietly passed that landmark 1999 legislation without a full public airing. In his 2010 testimony before the state Senate regarding a proposed pension-reform measure, Crane said CalPERS claimed at the time that “no increase over current employer contributions is needed for these benefit improvements.” Yet CalPERS recently boosted costs to local and state agencies by around 50 percent — and few legislators were concerned enough about the impact to seriously revisit pension reform — or look at ways to more thoroughly account for the level of debt today.
Despite the bull market, the state’s other big pension fund, the California Public Employee Retirement System (CalPERS), recently imposed a 50% increase in pension costs on local and state governments, and there will be more. The diversion of government revenues to pension costs explains in part why, despite record revenues higher than before the Great Recession, state spending on social services, courts, parks, universities and other programs is lower.
The variations in revenue projections are getting wider, not only between those of the agencies, but from one cycle to the next. And they make state budgeting less an exercise in priority-setting and more a crapshoot whose outcome is determined by esoteric factors completely out of politicians’ control.
The fatter budgets outlined by Assembly and Senate leaders seize on alternative estimates from legislative analysts that the state will receive $3.2 billion more revenue than the Brown administration projects.
Unions and grass-roots organizers are considering an effort to, over Brown’s objections, extend the higher taxes that the governor persuaded voters to go along with in 2012. They are also pondering a proposal to alter the state’s landmark restrictions on property taxes, to raise more revenue from commercial interests.
Roughly one in five black adults works for the government, teaching school, delivering mail, driving buses, processing criminal justice and managing large staffs. They are about 30 percent more likely to have a public sector job than non-Hispanic whites, and twice as likely as Hispanics.
A better approach would be to fold in services but cut the sales tax rate deeply enough to make the shift revenue-neutral, thus aligning it with the economy, providing tax relief to low-income families and allowing revenues to grow with consumer spending.