Budget? What Budget?

Remember 33 days and one election ago when the Legislators and Governor in Sacramento approved (October 8th) the state budget 100 days late? Well, that was then and this is now. Apparently they were surprised to find out that they had overestimated the revenue by over $6 Billion. This $6 Billion added to the existing $19 Billion deficit for next year adds up to being $25.4 Billion short for the next 18 months. So says the non-partisan LAO (Legislative Analyst Office) report. By the way, the total existing state budget is $86.6 Billion – so this equates to 22% of that total.

So the news outlets from Sacramento to San Diego and nationally is alive with the news that the Governor has now (November 11th) called his 18th Special Legislative Session to resolve the issue. The interesting part is that the Special Session starts on Monday, December 6th (after all the new legislators are sworn in). So the session essentially begins less than a month before the new Governor is sworn in on Monday, January 3rd. So by my calculation, the legislature probably has about 2 weeks working time before the new Governor arrives. To add to the drama, newly-elected Governor Brown has a legal responsibility to issue his budget plan for 2011-12 about a week after he is sworn into office.

Blogger John Fensterwald adds to the excitement by adding his understanding of the LAO’s comments that there is an “easy fix” for almost $2 Billion of the issue – by taking back the money we just received in schools – one month ago. Fensterwald said:

• “But the LAO did say that the Legislature should consider reneging on funding $1.8 billion that it added to Gov. Schwarzenegger’s May revised budget. That money is to be deferred to next July, after the start of the next fiscal year, but cutting it would erase about a third of this year’s estimated budget deficit. And it wouldn’t make much difference anyway since “most districts have been cautious in increasing 2010-11 program support as a result of recent deferrals.”
• Which is a diplomatic way of saying, Go ahead, legislators, and take it back, because most districts were smart enough not to trust you in the first place.”

We have and do fully expect the State to take back these funds they just delivered to us – and required us to modify our local budgets. Hang on tight!