CA’s Revised Budget Confronts Grim Realities

     SACRAMENTO, Calif. (CN) – Facing a budget shortfall ballooning to nearly double what he predicted in January, Gov. Jerry Brown released his revised state budget Monday and promised even deeper cuts than the first draft threatened.
     The governor took to YouTube Sunday afternoon to soften the coming budgetary blow by releasing the dire truth: a spending gap that increased to $15.7 billion from the $9.2 billion he estimated in the first draft of the budget.
     “This budget reflects the fact that the nation’s economic recovery is proceeding more slowly than anticipated,” Brown in a statement. “Lower tax revenues, coupled with federal government obstructions that blocked billions in necessary cuts, have created a deeper budget hole. More painful reductions will be necessary as a result, but education and public safety must be protected.”
     Brown’s May revision proposes spending cuts across the board and relies heavily on voters approving his tax increase initiatives, which should be on the November ballot, to save education and public safety funding. The $4.1 billion in cuts proposed in this budget brings a total of $8.3 billion in cuts to state programs for the 2012-13 budget cycle.
     If his tax increases are not approved by voters in November, another $6 billion in trigger cuts go into effect Jan. 1, according to Brown.
     California’s court system, already hit hard by cuts last year, took it on the chin with the governor’s revised budget (see story above). Brown’s budget “restructures trial court funding, reducing General Fund support by $300 million on a one-time basis and requiring each trial court to use their available reserve. It delays court construction for a savings of $240 million and increases retirement contributions for state court employees. Altogether, these will result in $125 million in ongoing savings,” according to the governor’s statement.
     The revised budget includes a total funding of $3.6 billion-$730 million for the general fund-for the entire judiciary branch. But he also pointed out that general fund support of the judiciary has declined by $653 million ongoing since 2008. The governor cautioned the courts that the future looks even bleaker:
     According to the budget, $419 million of the cuts to the judiciary are characterized as “one-time,” with another $125 million in ongoing cuts.
     “$540 million affects the trial courts, but is fully offset by the use of trial court reserves and delays in court construction. The remaining $4 million will be achieved by permanent changes in retirement contributions for the AOC, including staff within the state supreme court, courts of appeal and the Habeas Corpus Resource Center. Additional permanent reductions include $50 million in court construction project savings that will be redirected to support trial court operations,” Brown said in the budget.
     Brown’s revision includes a statewide reserve equal to three percent of the trial court allocation, which the Judicial Council can hand out to individual courts to address emergencies or other budget shortfalls.
     Thirty-eight court construction projects will be delayed indefinitely under Brown’s revised budget; six other projects that are too far along to be delayed will be completed after a Judicial Council review, according to the budget.
     Court employees would also contribute more to their retirement under Brown’s plan – to 8 percent from 5, and in line with other state employees.
     “The May revision also assumes that the practice of paying the employee retirement contribution will be discontinued,” Brown said in his budget.
     The governor’s budget heads to lawmakers, who are constitutionally mandated to pass a balanced, on-time budget for Brown to sign by July 1.

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