California Reels from Massive Cuts

Posted by on Jul 7th, 2011 and filed under News. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry


State legislators passed a new budget bill last week, with Gov. Jerry Brown signing just before the start of the new fiscal year. The bill was signed amid an atmosphere of financial crisis, with democrats and republicans coming together despite disagreeing over issues such as tax revenues and spending for months. Many legislators from both parties are still unhappy about the budget.

While large cuts were to be expected from Brown’s refrain of “tough decisions,” democrats were unhappy with cuts made to higher education, welfare and other social services generally supported by the party. Republicans found the budget to be “more of the same” and were unhappy that it didn’t include reforms republicans have sought such as pension and spending reforms.

Among the cuts are a $5 billion slash to the Department of Health and Human Services, a pair of $650 million cuts in funding to both the University of California and California State University systems, a $350 million cut to the court system, among others. All in all, the cuts and redirecting of funds are intended to reduce the state’s deficit from $26 billion to $5 billion.

But the mammoth amount of cuts in the new budget may not be enough. The budget summary reads, “It is anticipated that General Fund revenue will be $4 billion higher than forecast in 2011-12.” If this anticipated revenue does not develop by the middle of the fiscal year, further cuts will be made to universities, public schools and social services.

Some of this new revenue will come from increases to fees for vehicle registration and wildfire protection. Brown and other democrats had hoped for tax renewals to be part of that revenue, but a majority of republicans in the legislature voted against tax increases. democrats will try for a tax initiative on the fall 2012 ballot.

Many are skeptical that this $4 billion in revenue will come to pass and still more are unsure whether this budget is little more than a temporary fix to a looming problem, especially if that extra revenue does not come through.

Brown acknowledged, “We made dramatic progress, but we’re not out of the woods.”

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