California governor’s budget focuses on savings, debt payoff

SACRAMENTO, Calif. – Ever mindful that the next economic downturn could be right around the corner, Gov. Jerry Brown released a record $113 billion California spending plan on Friday that resists calls for expanding social services and instead dedicates billions for paying down debt and saving for a rainy day.

“We saw the boom and the bust, and I’m trying to avoid that,” Brown said in unveiling his new budget proposal at the state Capitol. He will work with lawmakers in the coming months to pass a final version in June.

The Democratic governor returned to office four years ago amid multibillion-dollar deficits that left California in fiscal turmoil. Brown convinced voters to increase income taxes on the rich while cutting social programs, reducing education funding and restructuring government.

Now Brown, who was sworn into his fourth and final term this week, is determined not to spend all of California’s second annual surplus. That restraint has created an odd dynamic, with Republicans generally pleased with his plan while welfare advocates and members of Brown’s own party were disappointed he didn’t do more for the poor and to address income inequality.

Brown’s budget includes a $1.2 billion deposit into the rainy day fund and a $1.2 billion debt payment. He wants to pay off debt accrued during the recession, including making the final payments on a $15 billion bond that was championed a decade ago by then-Gov. Arnold Schwarzenegger to close the state’s deficit.