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14 January 2018, 12:16 | Tracey Rhodes
Jerry Brown unveils $132 billion California budget for 2018-19
Wednesday proposed a $131.7 billion General Fund budget plan for 2018-19 that fills the state's Rainy Day Fund to its constitutional target, fully implements the state's K-12 school funding formula two years ahead of schedule and provides $4.6 billion for the first year of a 10-year transportation improvement plan.
He's proposing a $190.3 billion spending plan today that accelerates funding for his signature education law and uses new gas tax revenue to fund $4.6 billion in new transportation projects. The Democratic governor projects California will have a $6.1 billion surplus but he wants to keep almost all of it in reserve for a future recession.
Taxes on recreational pot sales, which launched January 1, will bring in $643 million, Brown predicted. In 2012, he staked his governorship on a tax increase that voters approved that year and reauthorized in 2016. The rest will go toward research, mitigating the effects of past criminalization and drug abuse treatment.
The decision was hardly a surprise for close watchers of the state budget.
CalFire, the state firefighting agency, dipped into its emergency fund to handle the extra costs.
Brown dismissed concerns that California should be hunkering down for angry clashes with Republicans in Washington, even though the budget assumes robust funding for healthcare still being provided through the Affordable Care Act.
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California's general fund spending on prisons and parolees climbs about $300 million, to $11.7 billion, under Brown's proposal.
Brown also called for $46 million to give community colleges the option to offer one year of free tuition to eligible students.
The proposed budget includes $3 billion of new funding for kindergarten through grade 12 education and funding to create the first wholly online community college in California. As the new formula is implemented, no district will receive less funding than now provided.
The two pension funds are getting some help from the booming stock market this year.
Senate Democrats argued the state still isn't investing enough in public schools. To justify this approach, he highlighted how the volatile California tax structure that is swelling coffers now has previously forced massive budget cuts during recessions - including the $27 billion deficit he inherited back in 2011. It was later renewed temporarily but expires again in March.
Yet they noted that "the state budget process has just begun and we hope to continue conversations with the governor and the Legislature".
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The online college "is targeted at people who are in the workforce and they need to upgrade their skills and get an opportunity to improve their lives", said Brown during a press event Wednesday. Assembly Democrats had proposed that change, which they project would eventually cost $1 billion a year.
Brown's proposal is up 5 percent from the $125 billion budget plan he signed previous year. Another $2.3 billion would go to the state's operating reserve fund. Californian's who claimed the deduction took an average of $18,000 in 2015.
State officials are in a bit of a wait-and-see mode on the surplus, because part of the boost in December could be from taxpayers making early payments on tax bills they won't be able to deduct in 2018.
The state's fiscal health is especially crucial as it faces myriad challenges: record natural disasters, housing shortages and changes to federal tax regulation - all while it ramps up opposition to the Trump administration on several major policy fronts.
Such a change would likely need to be reflected in the state budget, even though it's meant to be revenue neutral. Brown said Wednesday. "And for that reason, if none other, we are going to keep this steady as we go".
Another goal includes providing more funding for education.
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