Gov. Brown Revises Budget Proposal

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California Gov. Jerry Brown delivered a keynote address as State legislators scramble to revise a budget that Brown vetoed in June 2011.

Governor Jerry Brown is proposing deeper cuts to state services, fewer working hours for state employees and more spending reductions in his revised budget, released Monday morning. Brown's updated spending plan depends on voters passing a tax increase proposal headed for the November ballot. The governor says if it doesn't pass, California is in for even more draconian cuts.

"While the short-term pain is real, I think the greater good is to balance the revenue with the spending, and that's what I'm committed to doing," Brown said during a news conference Monday morning. "But is it going to be a hard sell? Yes."

This weekend, Brown announced that the state's budget gap is $15.7 billion, not $9 billion as projected. That's because Tax Day was not as productive for the state as expected, mandatory spending on education was higher than projected and the federal government has blocked certain state budget cuts including to Medi-Cal health providers.

The revised budget proposes another $4.1 billion in cuts, bringing the total to $8.3 billion. The cuts include changes to court funding, and limiting Cal Grant funds based on student performance standards.

Brown's plan also includes a number of one-time savings and funding shifts, such as the end of redevelopment agencies. That could save $1.4 billion, based on the assumption of what California would save by not putting money into redevelopment agencies.

The budget also considers the benefit of Facebook beginning to trade public stock. That could bring $12 billion to state residents in the second half of the year, resulting in $1.2 billion in personal income taxes.

The revised budget also calls for cutting 5 percent of state workers' pay by shifting their workweeks to a four-day, 38-hour schedule. Closing state offices one additional day each week would also help reduce energy costs.

"We may be (having state offices) open 7 to 7, four days a week, instead of being open 8 to 5, five days a week," said budget director Ana Matosantos. "We'll be working with labor (unions) to achieve the savings."

Additional staff cuts would reduce California's government workforce by a total of 30,000 positions. During his news conference, Gov. Brown said voters should be careful about which jobs they sacrifice in this process.

"Government is a nurse, a teacher, it's a highway patrolman... and when we cut, that's what we cut," Brown said.

According to the governor's budget, his proposed tax increase measure would give California $5.6 billion more revenues to work within its General Fund. It would generate more than that, but billions will have to be put toward mandatory public education funding in line with Proposition 98. Without the tax measure passing, the new budget assumes more than $6 billion in automatic cuts -- known as "trigger cuts" -- including nearly $5.5 billion to education, $250 million each from the UC and Cal State systems and $50 million from services for people with developmental disabilities.

Republican lawmakers have solidly opposed the tax measure, arguing that it will hurt California's economic recovery and drive business out of the state. Brown originally hoped the Legislature would put his tax plan on the ballot, but GOP lawmakers successfully blocked the effort. That forced him to do it the hard way, turning in petition signatures for the  May 10th. Now, he says, he's looking forward to more collegial talks about the budget but expects it to be very difficult.

"Takeaways are never pleasant,"  Brown said. "Once you have (the funding), it's much more painful to give it up than if you don't get what you desire. ... It is difficult, and that's just life.

"It's called the cliff effect, when they push you off. And nobody likes falling."

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