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Budget Information

The All-Cuts Budget Scenario is Approaching - March 24, 2011



Governor Brown just signed several of the "trailer bills" that accompanied last week's passage of the budget bill. The education trailer bill, SB 70, includes the fee increase from $26 to $36 per credit unit (effective fall semester), as well as the new $129 million deferral from the end of the 2011-12 fiscal year to the 2012-13 fiscal year. For the geeks that noticed the technical error in the deferral language, we have been told a signing message will accompany the bill to ensure that, despite flawed language, the new deferral is from January-June 2012, to be repaid in October 2012.

Notably, the governor did not sign the main budget bill, SB 69, which has not technically been sent to him by the Legislature, despite its passage last Thursday. The twelve-day clock for the governor to act on the bill doesn't apply until the he physically receives the bill.

Capitol observers were caught a bit off-guard this morning by a short Senate session and the declaration by Pro Tem Darrell Steinberg that there would be a short session on Friday (required for the three-day weekend per diem), and that members would be "on call" for the weekend. Most people believe that, if no action is taken by Sunday, a June election can essentially be ruled out.

It now seems very unlikely that there will be a June election, and the governor this morning spoke of "initiatives" during a conference of the California State Association of Counties, leading many to believe that the November playbook is a distinct possibility. At the same time, a new poll by the respected Public Policy Institute of California found that only 46% of California residents were inclined to vote "yes" on the governor's tax extensions. This is the worst polling to date, and there is no reason to believe June vs. November makes a difference.

Folks, we are quickly approaching the all-cuts budget scenario.

Even Senate Republican Bob Huff, who has not been a member of the "GOP 5" negotiating for a deal, acknowledged "an all-cuts budget isn't our first choice." However, there's a growing sense that options are running out, as evidenced by Governor Brown's statement yesterday that "Whichever way I look, there are bears in the forest."

Republicans feel that they need to deliver even more to break their pledges and cast votes for taxes. Democrats are balking at the growing Republican demands. Labor, expected to fund the campaign, won't accept most of the GOP demands and is worried that a losing election happens, essentially validating an all-cuts budget (albeit in a very low turnout special election). The game of chicken may be about to come to a very ugly end that nobody actually wants.


Scott Lay
President and Chief Executive Officer, The League
Orange Coast College '94

Community College League of California
2017 O Street, Sacramento, California 95811
916.444.8641 . www.ccleague.org

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Last Updated: 3/24/11