California lawmakers have approved a $156 billion state budget that delivers a much-needed cash infusion to high-speed rail, guarantees 11,000 new transitional kindergarten slots to low-income children and begins what’s being billed as a 30-year effort to fill a wide gap in the state’s pension system.
The Senate and Assembly votes came Sunday evening, just hours before the constitutional deadline to pass a spending plan. Legislators would have lost pay if the budget had been late.
The votes capped a low-key budget process during which Gov. Jerry Brown and Democrats in the Legislature hashed out their relatively minor differences without any of the public ultimatums or threats that had marked negations when leaders had to close multibillion-dollar deficits and wrangle two-thirds support for spending plans.
“I am the last leader standing from the bleak winter of 2009,” remarked Senate President pro Tem Darrell Steinberg before the budget vote. Reflecting on what he called a “catastrophic” $42 billion deficit in the first budget he negotiated, Steinberg praised Sacramento’s new normal. “It is night versus day. It is a hailstorm versus bright sunshine. It is constant dread versus real hope for the future.”
Among the spending plan’s highlights:
$250 million for Brown’s prized high-speed rail project. The proposed San Francisco-to-Los Angeles rail line has run into barrier after barrier within the past year. But the budget steers a quarter-billion dollars of cap-and-trade revenue to the rail line this year, as well as 25 percent of future revenue from the pay-for-polluting permit system. The rail project desperately needs the money because the state needs to begin matching federal payments this year, and is currently blocked from accessing voter-approved bond money by court rulings.
The rail funding passed both chambers, but not without extended debate. Assembly Republican Jeff Gorell questioned the wisdom of steering hundreds of million dollars to a project that has hit so many snags, likening the rail line to Monty Python’s Black Knight. “It just seems like this legislative body and the governor is trying to stand up and say, 'This is merely a flesh wound.’ ” Gorell said. “It is not. High-speed rail is dead.”
A Plan for Pensions
A plan to gradually fill the $74 billion funding gap in California’s teacher retirement plan, known as CalSTRS. The state, school districts and teachers will all increase the amount of money they pay into the pension plan, though districts will do so at a more gradual rate than Brown initially proposed last month. The new formula will generate an additional $276 million for teacher retirement funds this year. That annual total will increase each year, topping $1.4 billion next year and eventually growing to more than $5 billion in 2020.
Minor increases for health and welfare spending. Democrats in the Assembly and Senate had made social services a big priority this year and were determined to push back against Brown’s frugal budget plan, which prioritized savings and debt repayment over restoring programs. Brown did make one major concession — he agreed to drop a plan capping the number of hours the state will pay for people who provide in-home care to the disabled.
But the governor stood firm in his opposition to increasing the payments the state makes to doctors who treat Medi-Cal patients. Speaking before a Budget Committee vote last week, Sen. Ricardo Lara, D-Los Angeles, called that “a hard pill to swallow. ... We talk about compromise — compromise is give and take. I think this is more like a smackdown.”
Lara and other Democrats are worried the lower rates, which went into effect this year, will keep doctors from treating Medi-Cal patients at a time when the state program is rapidly expanding under the Affordable Care Act. That’s an increase Senate Minority Leader Bob Huff said Republicans would have been willing to support.
Brown now has 15 days to review the budget language and use his line-item veto. He needs to sign a spending plan into law before July 1.