Gov. Brown's Final Budget Could Help Cement His Legacy

Whatever the details in a revised state budget Gov. Jerry Brown will present today, the plan will reflect the extraordinary distance California's economy has traveled since Brown took office in January of 2011.

Brown, who began his second run as governor in the midst of the Great Recession, inherited a jaw-dropping $27 billion budget deficit. His first budget called for massive layoffs, furloughs of state workers and slashes to funding for education, health care and other core programs.

Painful as it was, in some ways the hole proved to be a well-disguised blessing as it allowed the governor to take dramatic steps to reshape state government in ways that might otherwise not have been possible. As the saying goes, "never let a good crisis go to waste."

The "May revise" Brown will unveil later this morning includes the most recent revenues collected by the state since he revealed his first draft back in January. As of a week ago, the state Department of Finance said revenues were running about $3.3 billion ahead of the January projections.

The 2018-19 state budget Brown proposed in January was a $131.7 billion general fund plan, with healthy contributions to the rainy day fund that voters approved in 2014. Under the governor's plan the fund, which is intended to cushion pain from the next economic downturn, would have $13.5 billion by the end of the next fiscal year.

Referring to the course of fiscal restraint he has steered, Brown wrote in a letter to the Legislature four months ago, "let's not blow it now."

Democrats in the Legislature say they recognize the importance of saving. But the state's growing revenues also have them eager to spend in some areas.  Sen. Holly Mitchell chairs the Senate Budget Committee.

“I’m looking for mo’ money, mo’ money," Mitchell laughed. "And when I say mo’ money I mean mo’ investments in California and Californians.”

Brown has announced some of his plans. He'll include $96 million in his budget revision for better forest management and wildfires prevention.

Mitchell would like to see money go to programs such as aid to welfare recipients, low-income seniors and the disabled. Chris Hoene with the California Budget & Policy Center agrees.

"Those programs were cut significantly during the Great Recession and received almost no build-back in the time since," Hoene said. "There ought to be space to do more in those arenas."

Knowing Brown's budgeting style, Hoene said if there is new spending it will likely be in one-time, rather than ongoing, allotments. And no one is expecting Brown to abandon the message of fiscal restraint he's been pushing for the last seven years.

“If there’s one thing the governor’s committed to do is making sure that the state is on a solid fiscal footing when he leaves office," said H.D. Palmer with the administration’s Department of Finance.

Republican consultant Sean Walsh, who helped Gov. Pete Wilson roll out several state budgets in the 1990s, said all governors have an eye to the future with their final spending plan.

"The last budget is either a lasting gift or a booby prize for your successor," Walsh said, adding that "there's a lot of history for both kinds" of parting budgets. Walsh noted that Wilson left Gray Davis "a huge surplus," while Arnold Schwarzenegger left a fiscal disaster for Jerry Brown to clean up.

Brown, Walsh believes, will definitely be looking to cement his legacy -- a word the governor resists using. "He's trying to wipe away his image of yesteryear-- Governor Moonbeam and all that -- by leaving a large reserve that shows he was always the fiscal adult in the room ... resisting activist Democrats who wanted to spend every single penny that came into the treasury," Walsh said.

In any case, the inevitable economic downturn that Brown has been warning about for years will likely happen on his successor's watch. And it won't take long to drain those reserves he spent years building up.