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Governor Brown Releases Budget Revise

May 2011

Governor Brown has unveiled his May budget revise, which realizes an additional $6.6 billion in tax revenue for the fiscal year, but still relies on increased fees and taxes to continue to pay down California’s debt in the coming years. While the new proposal will forego the increased income taxes for 2011, which had expired in January, it will immediately install the increases in vehicle fees and sales taxes, which are set to expire in June. The plan calls for income taxes to increase to previous levels starting in 2012.

Sticking to his campaign pledge, Brown is seeking a vote by the legislature to pass his new budget proposal and will later seek ratification of the tax extensions by a vote of the people.

The May revise also proposes to eliminate 43 state boards and commissions and close 70 state parks to cut state spending. Funding for education is maintained without additional cuts.

Meanwhile, Republicans have released their own proposed spending plan, which relies heavily on the recent upswing in state revenues. The Republican plan would not raise taxes and instead would rely fully on budget cuts. The Republican proposal also keeps education fully funded and relies on a number of cuts to state employees, social and health services, and privatizing some state jobs.

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