California’s budget proposal for the 2016-2017 year could not be more stable compared to those in previous years and California Governor Jerry Brown is determined to not only recognize the state’s many achievements, such as a continued investment in education funding, the 15 million Californians who are covered by either Medi-Cal or Covered California, the minimum wage which has risen to $10 an hour; or the state providing $400 million to low-wage working families through an earned income tax credit—he wants to continue practicing restraint and prudence.
“The budget is not perfect— it’s far from perfect, but we are in a good place, a solid place. We are enjoying surpluses after years of cuts, and we cannot forget that 69.5 percent of our General Fund revenues come from the volatile personal income tax and history has told us, it can drop during a recession,” said Brown during a press conference last Thursday morning at the State Capitol.
Brown’s budget proposal makes a strong emphasis on continued investment in education. In 2007-2008, the minimum guarantee of funding for K-14 schools was $56.6 billion and sank to $47.3 billion in 2011-2012. Since 2012-2013, funding has steadily increased, jumping to $58.9. This year, it will jump to $71.6 billion—an overall increase of $24.3 billion in five years (almost 51 percent).
For K-12 schools, funding levels will increase by 3,600 per student this fiscal year and continued implementation of the Local Control Funding Formula will continue in place. This year’s budget provides $2.8 billion in new funding, bringing the formula’s implementation to 95 percent complete.
The budget also seeks to extend the goals of the Local Control Funding Formula by focusing on the state’s early education programs. Approximately $1.6 billion early education block grant combining three existing programs that promote local flexibility will focus on the state’s most disadvantaged students and improved accountability.
“Education continues to be an important part of our budget and this year is no different,” said Brown.
Higher education will also see some investments. Brown wants California colleges and universities to maintain their quality and affordability as they are “one of California’s greatest strengths.”
This year’s budget keeps tuition at 2011-2012 levels. The state will focus on ensuring students will take less time successfully completing a degree or certificate while colleges and universities can ensure their systems are financially viable over the long term. Increased funding will be used to get students their degrees in a timely manner instead of focusing on admitting more students.
The Brown administration is firm on keeping student costs low while promoting new technology and innovation, rethinking remediation practices, easing the transfer process from community colleges to universities, and improve graduation rates.
Assembly member Jose Medina, D-Riverside who is Chair of the Assembly’s Higher Education Committee hailed the Governor’s focus on higher education in this year’s budget.
“The Governor’s budget proposal includes important funding increases for UC, CSU and California’s community colleges. This represents crucial funding for California’s public higher education segments. I am also pleased to see the plan include a proposal to hold tuition and fees at current levels,” said Medina.
“More needs to be done, however, in order to ensure high-quality education and increase access at our public colleges and universities. We have a responsibility to provide protection and relief for those California students who were not served by California’s public colleges and were defrauded by unlawful for-profit colleges.”
The state’s public colleges and universities will see an additional $596 million investment, including an expansion of enrollment funding by 2% to serve an additional 50,000 students and $248 million for programs that support career technical education and student transition to the workforce, and $25 million for Innovation Awards to—among other things—improve transfer pathways. An additional $30 million proposal will continue to invest in better preparing students for college level work.
Brown’s budget proposal adds $174 million from the General Fund to the University of California and $151 million to the California State University budgets, respectively. For the fifth year in a row, UC and CSU schools will be expected to keep tuition flat for students.
“We applaud Governor Jerry Brown for proposing more money for California colleges and universities with the expectation that they maintain affordability, significantly improve student success, and close persistent gaps by race and ethnicity,” said Jessie Ryan, Executive Vice President of the Campaign for College Opportunity.
Even though the state does not propose any increases to the state’s financial aid program, it does provide the funding for an increase in the number of students eligible for the competitive Cal Grants as well as funding for continued implementation of the Middle Class Scholarship.
“Reinvestment in higher education, holding our colleges and universities accountable for expanding access and ensuring more students graduate is good news for California. What we need now is a bold, visionary statewide plan for higher education that can guide investment and align our colleges and universities around goals over time. Students and our state deserve a sustainable vision for success that goes beyond the limitations of the annual budget process,” said Ryan.
Brown’s budget also proposes to transition contracted child care funding into vouchers over the next five years as well as creating a $1.6 billion Targeted Play and Early Learning Block Grant to expand the goals of the Local Control Funding Formula to allow local education agencies to serve low-income and at-risk 4 and 5 year-olds by consolidating funding from the State Preschool Program, transitional kindergarten, and the Preschool QRIS grant.
Advocates say this is a step in the right direction for early childhood.
“Brown’s budget calls out the critical link between early education and success in the K-12 years, especially for children from low-income families, dual language learners, and those most at risk. However, the state’s strong surplus should translate into a strong increase in the state’s investment in quality early learning opportunities for young children,” said Early Edge California President, Deborah Kong.
Health and Human Services
Brown’s budget proposal focuses on the Health and Human Services Agency which oversees departments and other state entities that provide health and social services to California’s most vulnerable and at-risk residents. This year’s budget allocates $136 billion for these programs. The bulk of the expenditures are to serve Medi-Cal.
“California continues its implementation of federal health care reform, which has enabled millions of Californians to obtain health care coverage. Many Californians now have access to affordable, quality health care coverage through Covered California,” said Brown.
California has also expanded Medi-Cal to cover childless adults and parent/caretaker relatives with incomes up to 138 percent of the federal poverty level, and expanded Medi-Cal mental health and substance use disorder benefits. Since 2012, total Medi-Cal benefit costs grew at an average of 22 percent annually to $87.9 billion in 2015-2016 because of a combination of health care cost inflation, program expansions, and caseload growth. Medi-Cal General Fund spending is projected to increase 8 percent from $17.7 billion in 2015-2016 to $19.1 billion in 2016-2017.
In total, over a third of the state’s total population will be enrolled in Medi-Cal, with total caseload expected to be 13.5 million in 2016-2017. In addition, 1.5 million people will be enrolled in Covered California by the end of 2015-2016.
Gov. Brown’s budget proposal does not leave out important changes to existing infrastructure. The deferred maintenance on existing state infrastructure is staggering at an estimated $77 billion with much of it based on its highways, roads and bridges. This year’s budget includes $807 million ($500 million General Fund) for critical deferred maintenance at levees, state parks, universities, community colleges, prisons, state hospitals and other state facilities.
The Budget also supports a major investment in renovating Sacramento’s aged and inadequate state office infrastructure. The budget proposes a $1.5 billion General Fund down payment to begin work for three buildings, including the State Capitol Annex.
Overall, Gov. Brown’s budget focus on education, infrastructure, poverty and climate change are good starting points moving into the new legislative year.
“The Latino Caucus is pleased that Gov. Brown, through the state budget, continues to address many of the state’s most pressing needs, including education funding and infrastructure. We look forward to working with the Administration to ensure that these critical investments are made in the most effective and broad-based manner possible. Additionally, we will continue our advocacy for the restoration of programs and policies — many of which were gutted during the height of the recession- that constitute social safety net for the less fortunate in our communities,” said Luis A. Alejo, D-Salinas, Chair of the California Latino Legislative Caucus.