California faces $1.9 billion deficit

November 14, 2012

California faces $1.9 billion deficit

California faces a $1.9 billion deficit through June 2014, significantly smaller than in recent years after voters passed two tax initiatives last week, the nonpartisan Legislative Analyst's Office said Wednesday.

The Analyst's Office said in its annual precursor to the budget process that California faces a small deficit because spending is higher than expected and the state will not receive as much as Gov. Jerry Brown predicted from shutting redevelopment agencies. It also believes other revenues from a managed care tax and cap-and-trade auction will fall short.

But the 19-month deficit figure of $1.9 billion pales in comparison to the $13 billion gap the LAO predicted last November or the $25 billion shortfall it foresaw two years ago. The deficit includes a $943 million deficit in the fiscal year that ends in June.

"The state's economic recovery, prior budget cuts, and the additional, temporary taxes provided by Proposition 30 have combined to bring California to a promising moment: the possible end of a decade of acute state budget challenges," the LAO said in its report. "Our economic and budgetary forecast indicates that California's leaders face a dramatically smaller budget problem in 2013-14 compared to recent years."

The Analyst forecasts the possibility of surpluses starting at $1 billion in 2014-15, growing to more than $7 billion in 2017-18. But that depends on Brown and lawmakers restraining program growth, and numerous advocates are likely to ask for existing cuts to be reversed given the additional money available.

Brown said in a statement: "This report validates the hard work the state has done to cut its deficit and balance its budget over the long term. California is now on the path for a fair and sustainable budget as long as we continue to exercise fiscal discipline and pay down debt."

The governor's Department of Finance told the LAO last week that it had discovered $1.4 billion in extra money from an accounting change. The Analyst's Office said that "adjustment" for the 2010-11 fiscal year was unusually large. Without it, the deficit would have been $3.3 billion.

Post updated with quote and additional details at 12:45 p.m. and 2:15 p.m.

Capitol Alert: California faces $1.9 billion deficit

The liberals in California keep doing the same stupid things and expecting a different outcome.

November 14, 2012

California legislators attend policy conference at Hawaii resort New Zealand and Australia

More than a dozen California legislators are lodged in Hawaii's fancy Fairmont Kea Lani hotel this week -- hobnobbing and talking public policy with dozens of corporate, union and other officials that do business at the Capitol.

The annual invitation-only conference is sponsored by the California Independent Voter Project, a nonprofit public policy group that is funded through various business, labor and other groups.

Legislators' travel to Maui and their hotel tabs will be picked up by the nonprofit unless they opt to pay their own way.

Dan Howle, event organizer, declined to identify members of the California Legislature participating in the annual conference. He said they consist both of Republicans and Democrats. Several of the lawmakers are paying their own way.

The Kea Lani resort describes itself as a "luxurious haven in one of the most scenic places on Earth." It touts a sandy beach, three swimming pools, fine dining, and activities ranging from sailing to kayaking.

Mixing business with pleasure, legislators participate each morning in discussions on health care, energy, economic development, telecommunications, public safety and other issues. Afternoons are free to mingle, socialize or enjoy Maui's tourist attractions.

Political issues to be discussed include the possibility of imposing instant online reporting of political donations and moving California's primary elections from June to September.

Howle said the conference is held in Hawaii each year, rather than California, because the ambience encourages attendance and allows sponsors to be charged enough to make the event a major fundraiser for Independent Voter Project
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"There's something about being here that makes for a better degree of cooperation," Howle said. "You get people who are polar opposites talking here, and some of that carries over into Sacramento -- and it doesn't happen in California."

"I've seen developed, over the course of years, relationships that you'd never have imagined," Howle said. "There has been very, very productive cooperation ... It just works."

In addition to 13 or 14 California legislators, the conference includes about a half-dozen lawmakers from Illinois, Texas and Idaho, and more than 100 corporate, labor or other representatives. Fifty or 60 sponsors pay the tab, Howle said.

A separate nonprofit group, Pacific Policy Foundation, is scheduled to host a separate Maui conference later this week, with about eight to 10 legislators expected, Howle said, adding that the lawmakers attending his conference will not participate in the later gathering.

November typically is prime time for lawmakers to engage in out-of-state policy conferences or study trips, some paid by corporate sponsors, some by the officeholders themselves. California's Legislature does not typically meet that month and this year's elections ended a week ago.

Four state senators are picking up their own travel and hotel tab for a 13-day study trip to New Zealand and Australia, which will bankroll some in-country expenses, such as meals or ground transportation, said Mark Hedlund, Senate spokesman. The trip began Nov. 8 and is set to end Tuesday.

Participating senators are Senate Republican leader Bob Huff, of Diamond Bar; Jean Fuller, R-Bakersfield; Mark DeSaulnier, D-Concord; and Juan Vargas, D-San Diego, Hedlund said.

California's four-person Senate contingent with meet in Australia and New Zealand with legislators, government officials, business executives and others to discuss education, economic, trade, clean energy, emergency management and other issues, Hedlund said.


* Updated at 12:40 p.m. with details on the Senate trip to New Zealand and Australia.
http://blogs.sacbee.com/capitolalertlatest/2012/11/california-legislators-attend-policy-conference-at-hawaii-resort.html

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