Isn’t America great when a state can bust it’s annual budget year after year? And guess what? California is good at it!
Here are a few facts about California’s 2016-17 budget summarized by the Public Policy Institute of California (PPIC) that may give a clue to some of us why the state fails every year to stay under, or at, their agreed to budget. Laughably, the first line of the summary reads – “The new spending plan reflects continued economic health”…Lol. You need to remember that this year’s budget is $7.1 billion (or 6%) more General Appropriations (revenue) than the enacted 2015–16 budget:
- The budget includes $820 million to cover 5% of the cost of optional Medi-Cal expansion under the federal Affordable Care Act, plus an additional $188 million to enroll 185,000 undocumented children in Medi-Cal. Note: “Medi-Cal” is California’s name for “Medicaid”.
- The budget dedicates $95 million to repeal the maximum family grant rule under the state’s assistance program for low-income families (CalWORKs), which denied aid to 130,000 children conceived while their parents were receiving aid.
- The budget includes a $2 billion bond for housing for the mentally ill.
- The budget reserves $400 million for affordable housing, but only if proposed legislation passes that would speed up the local approval process for multifamily developments.
- Projected federal funds for the year are $96 billion…yep, “BILLION”. Let’s see how hard the state allows their “sanctuary cities” to fight The Don’s new policies and laws.
Anyway, get the picture? And this is just the tip of the iceberg, and all after California overtly raised taxes on the wealthy and covertly did the same to middle class residents through their bonds, fees, and rates.
There goes that “rainy day fund” that Governor “Moonbeam” Brown established when he declared California would be financially stable moving forward…I guess that he didn’t tax enough of the wealthy. Maybe he needs to lower the “contributory” threshold of the wealthy down to a couple making $100,000 or more.
A financial report issued by state auditors finds that the state of California is in the red by an unsustainable $127.2 billion.
The report says that the state’s negative status increased that year, largely because it spent $1.7 billion more than it received in revenues and wound up with an accumulated deficit of just under $23 billion in fiscal year 2011-2012, the Sacramento Bee stated.
Gov. Jerry Brown has referred to the deficit and other budget gaps, mostly money owed to schools, as a “wall of debt” totaling more than $30 billion, the Sacramento Bee reported.
About half of the deficit came from the state issuing general obligation bonds and then giving the money to local governments and school districts for public works projects. The report listed California’s long-term obligations at $167.9 billion, nearly half of which ($79.9 billion) were in general obligation bonds, with another $30.8 billion in revenue bonds, the Sacramento Bee reported.