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Gov. Jerry Brown warns more budget cuts are coming

Brown issued the warning while delivering boxes of petitions to election officials requesting that his proposed tax hike be placed on the November ballot.

May 11, 2012|By Chris Megerian and Anthony York, Los Angeles Times
  • Surrounded by reporters and cameras, Gov. Jerry Brown and his wife, Anne Gust Brown, turn in boxes of petitions to the Sacramento County Registrar of Voters on Thursday. The petitions request that his tax hike initiative be placed on the November ballot.
Surrounded by reporters and cameras, Gov. Jerry Brown and his wife, Anne… (Rich Pedroncelli, Associated…)

SACRAMENTO — Gov. Jerry Brown warned Californians on Thursday to brace for another round of difficult budget cuts as he hand-delivered boxes of petitions to election officials requesting that his proposed tax hike be placed on the November ballot.

Brown, who is expected to unveil his revised budget proposal Monday, said he needed far more than the $4.2 billion in spending reductions he asked for in January. And he continued to raise the specter of even deeper wounds to public schools, colleges and other state services if his bid for tax hikes fails.

"With this tax measure, and with the cuts that I'll be proposing on Monday, California will put itself in a very, very strong position," said Brown, flanked by his wife and dog at the Sacramento County Registrar of Voters.

It's become a familiar refrain from the governor — telling Californians to trust that he is being frugal while asking them to open their wallets wider. Brown hopes the message sticks even as the mood in Sacramento turns grim.

Tax revenue has lagged by $3.5 billion and the state has shelled out $2.1 billion more than expected so far in the current budget, according to the state controller. Brown said Thursday that his new spending plan will fall between $85 billion and $90 billion, down from the $92.6 billion proposal he released in January.

A budget for the new fiscal year, which begins July 1, is due from the Legislature by June 15.

The linchpin of the governor's financial plan is his request that voters approve a quarter-cent increase in the state sales tax for four years and a seven-year hike on incomes of $250,000 or more that will range from 1 to 3 percentage points. He says the measure would raise $9 billion in the upcoming budget year.

Brown has said that he would be forced to cut $5.4 billion from the next budget — mostly from public schools and colleges — if his tax plan failed. That number is expected to increase in his revised proposal Monday.

The cautious optimism of January, when Democrats hoped that a windfall from Facebook's IPO and a rebounding economy could help them dodge social service cuts, has now given way to an acceptance in the Capitol that sagging revenue will require steeper reductions than expected.

Activists who have met with administration officials said they expect cuts in health and welfare programs in particular. Casey Young, a lobbyist for AARP, said Brown's health secretary, Diana Dooley, "appeared visibly shaken by the choices she was having to sort through" in a recent meeting.

It's not just the poor and needy who are likely to feel the ax. Brown is also expected to ask unions to help reduce state payroll costs. Yvonne Walker, president of Service Employees International Union Local 1000, the largest state worker union, said she had been conferring with administration officials on the issue.

She assured union members in an email that "furloughs are not on the table," as they have been in past years.

Details of Brown's coming budget proposals are being tightly guarded. The governor has refused to discuss the size of the deficit publicly, but some budget watchers fear it may have grown to $15 billion — a 60% increase over his most recent public estimate.

"All we've been told is that it's really bad," said Vanessa Cajina, a lobbyist at the Western Center on Law and Poverty, which advocates for the poor. "Essentially anything in the safety net is up for grabs right now."

Although the state budget is vast, state and federal regulations require certain levels of spending on public education and healthcare for the poor. Social services have fewer restrictions on them and thus are easier to cut.

Senate leader Darrell Steinberg (D-Sacramento) said he hoped to fend off deeper cuts in welfare, which has already been hard hit by the state's financial crisis.

"We will fight to save more than we lose," he said, adding, "We've been involved with a bloodletting in the last several years."

He also said that an estimated $1.5 billion he had hoped to use for affordable housing could be tapped to pay for some welfare services and to otherwise help balance the budget.

Much of Brown's fiscal success this year will come down to his ability to persuade voters he is acting in the best interests of the state and not on behalf of any particular ideology or interest group, said Sonoma State political science professor David McCuan.

"He can portray himself as the honest broker and the grown-up, particularly in contrast to the Legislature," said McCuan. "He can tell people that the alternative to passing this measure is pulling the plug on old people, school kids and the most vulnerable — and he'll actually do it."

If it qualifies for the ballot, the governor's proposal would not be the only tax increase for voters to weigh in on in the fall. A measure backed by Pasadena attorney Molly Munger would raise income taxes on people making more than $7,000 a year and dedicate most of the proceeds to public schools.

chris.megerian@latimes.com

anthony.york@latimes.com

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