State Budget Surplus Leads to Spending Tensions

As he prepares to release a new state budget proposal Thursday, Gov. Jerry Brown is looking at a more-than-generous surplus.

The nonpartisan Legislative Analyst’s Office estimates revenues could be $3.6 billion above projections. The influx of cash means many will be eager to replenish programs that were slashed during the recession.

Chris Hoene leads the California Budget and Policy Center.

“The reality is that the revenue collections the state’s been realizing over the last year are dramatically above where the governor had projected and even where the budget ended up," he says. "And that means there’s enough money on the table to be fiscally prudent and make some of these investments in the people that have been left behind.”

Hoene lists the state’s welfare program, early childhood education and assistance for low-income seniors and the disabled among the priorities.

But Claremont McKenna College government professor Jack Pitney says Brown would be smart to maintain his cautious approach, which includes bolstering the state’s reserves.

“Because California has a progressive system that’s heavily dependent on the fortunes of the fortunate, the stock market has a lot to say about whether that surplus will continue," he says.

Still, the budget has come a long way since Brown began his second stint as governor in 2011. Back then California faced a $25 billion deficit.