How does a budget go from a $30 billion surplus to a $30 billion deficit? Well if you have 50% of the taxes paid by 1% (yes 1%), and $29 billion dollars worth of taxpayers leave the state, well, the math is easy to do. Maybe spend less? Maybe try to make the state more accommodating for those paying the bills? Read this and judge for yourself.
(Sacramento, CA) — California’s budget deficit is growing. Governor Gavin Newsom is unveiling his revised 306-billion dollar state spending plan. The projected shortfall between revenues and expenses is up by more than 9-billion dollars compared to the initial budget plan released in January. Newsom says core areas will continue to be funded.
{{f4b78de4-23f1-4bc0-a77c-a676fe94d449}}Homelessness and flood protection and response are high on the list of priorities. Reaction is starting to filter in. A union representing Cal Fire says the governor is embracing an “aggressive approach” to fire suppression and prevention. Public health advocates are praising the restoration of 50-million dollars for public health workforce development and training. Republicans however are slamming the plan. Assembly Republican Leader James Gallagher says “only Gavin Newsom could turn a 100-billion dollar surplus into a 31-billion dollar deficit in less than a year.”
Newsom’s plan to address the shortfall in revenue is a combination of cuts, spending deferrals and borrowing. Democratic lawmakers have floated a plan which cuts taxes for small businesses while putting more burden on the largest companies. Senate Budget vice chair Roger Niello says in a statement he would not recommend borrowing “during this time of high and increasing interest rates.” The Legislature must approve a new budget by the middle of next month.
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