MA

California FY 14 budget produces golden results

Published: March 05, 2013

BudgetContract AwardsForecasts and SpendingPublic Finance

On January 10, 2013, Governor Edmund Brown Jr. released the state of California’s FY 2013-2014 budget. This revolutionary budget propels California out of a deficit and sets the stage for successful years to come. California has had an unbalanced budget for the past few years, but this year’s balanced budget provides much-needed stability for the state.
 
While the governor was able to reduce spending in many departments, he also introduced Proposition 30, which increases taxes on the $250,000 annual income bracket and raises sales and use taxes ¼ cent for four years to fund educational programs. This proposition will provide the state with approximately $6 billion annually to spend on education in an effort to even the playing field for lower-income schools and provide students with equal opportunity. This budget also highlights Proposition 98, which funds educational analysis. The $56 billion accumulation will provide educational programs to K-12 students at a $2.7 billion increase from last year.
 

Click on image for full-sized.
 
Considering the $9.2 billion deficit from FY 2013 that was weighing on Governor Brown, this balanced budget is quite an accomplishment. It sets the stage for future years and budgets, and shows that by reevaluating what is necessary and what is not, a balanced budget is quite plausible. In FY 2013, the governor stated that over the next few years he would reduce the state deficit, and he is well on his way with FY 2014’s budget. It offers a multiyear plan that pays down the debt from previous years while also creating a $1 billion reserve safety net. This budget alone will tackle $4.2 billion of the debt by repaying budgetary borrowing.

A full analysis of the California FY 14 budget is available here. Non-subscribers can gain access with a GovWin IQ free trial.