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Governor seeks to wipe out $9.2 billion deficit with higher taxes, cuts in welfare, Medi-Cal

SACRAMENTO -- Gov. Jerry Brown on Thursday unveiled his new budget plan, calling for a $4.8 billion cut in school funding if voters reject tax increases he wants to put on the ballot in November.

Despite the possible cut -- the equivalent of slashing three weeks from the school year -- the proposed budget assumes the state faces a $9.2 billion deficit, a vast improvement over last year's $26 billion gap.

Half of the deficit would be wiped out through Brown's proposed temporary half-cent sales-tax increase and higher taxes on those making $250,000 a year or more -- or by the schools cuts. The rest would be eliminated with cuts in welfare, Medi-Cal and other programs.

"We've cut the structural deficit substantially, and we now have the possibility of eliminating over the next couple of years the deficits that have plagued California," he said at a news conference.

Brown was forced to unveil his budget Thursday because the Department of Finance mistakenly posted it online, four days before he planned to release it.

Brown estimated the total general fund budget for the coming year will be $92.5 billion, about $7 billion more than the current year.

The general fund pays the day-to-day operations of government and is where the budget has been in deficit.

Brown's tax plan would raise about $7 billion a year and would expire in 2017, by which time Brown hopes the economy will have improved enough to bring a healthy flow of tax revenue back to the state.

If voters reject his tax increases, Brown will call for an automatic cut of $4.8 billion from schools.

"Cuts are never nice because government does a lot of good things. But we'll have the tax measure proposal, we'll have some cuts and then we'll have some trigger cuts in the event that the tax measure does not succeed," he said.


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