The budget proposes to offload state responsibilities like public safety and health services onto local governments, funding them for five years with money raised if voters approve the extension of tax hikes in June.
This would include eliminating the California Division of Juvenile Justice. Local governments would be expected to house and manage the juveniles as well as to house non-violent adult offenders. It's questionable whether local governments can handle this or if the money from the state will be adequate. Also, it's unclear what happens after five years. Other shifting of responsibility includes rural fire fighting, mental health care, and related services. Of course the tax extensions must be approved for this to happen. There's been no word on backup plans should the measure fail.
While moving responsibilities from the state to local entities may help the state budget, it simply dumps them on governments that are already having severe budget problems. Are the local governments mandated to take the responsibilities or can they say No? What levels must they fund at, if any? This seems a desperation measure, and the results of it may not be beneficial for Californians.
The budget also, rather depressingly, utilizes a number of evasive moves, such as grabbing earmarked money for the general budget, either through "borrowing" or backdoor maneuvers. Here are some others:
Diverts cigarette tax money earmarked for childhood development to pay for childhood Medi-Cal.
Uses Prop 63 money for mental health to replace general fund spending on mental health.
Uses gaming revenue for general fund.
Continues borrowing from special fund.
Uses truck weight fees for debt service, doing an end run around Prop 22, which prohibits this.
Takes money from disability fund to cover borrowing interest for state unemployment fund.
None of these measures solve the underlying problem. They simply move money around, pretending everything is okay. The federal government has been lending states money at no interest to pay unemployment claims. But that has expired and interest will now be charged. To steal money from a disability fund to fund interest on unemployment claims borrowing is noxious and irresponsible, but that's what the budget proposes.
As a side issue, the state also wants to close parks that have low attendance. This could have unintended consequences. If regular citizens are not there, then marijuana plantations, meth labs, and homeless encampments are almost sure to result, especially if the parks are patrolled little if at all by law enforcement.
The unspoken issues in the budget are debt service and pension funding. The non-partisan LAO says retirement and debt-service was 12% of general Fund revenues in 2009-10 and this is expected to rise to 15%. This does not include debt service and pension funding which is not in the General Fund. In fact, a staggering $81 billion in pension liability was not included in the 2009 California financial report. Thus, budget numbers are still more fictitious than actual as such liabilities are still not included.
Gov. Brown's budget seems new and innovative at first but upon closer examination, it's the same old robbing Peter to pay Paul with an added enhancement of dumping as much as possible on local government and letting them deal with it. This is not a long-term solution.