Jerry Brown

Published: Jan. 10, 2013 Updated: 9:24 p.m.

SACRAMENTO – True to his word, Gov. Jerry Brown on Thursday proposed a budget for 2013-14 that eschews dramatic, across-the-board spending increases, despite new revenue, and instead offers modest gains to California schools.

The governor’s initial plan calls for increasing education funding by $2.7 billion in the coming fiscal year while generally maintaining previous budget cuts – although, overall, his plan would boost general fund spending by 5 percent over the current year.

“It maintains the cuts that were made in the past two years. It selects where to put the emphasis to get the biggest bang for our buck, namely schools,” Brown said at a news conference at the state Capitol.

“There was a 5 percent increase in the wealth,” the governor said in explaining the overall spending increase. “If … you take a look at the number of (state) employees in relationship to the number of people living in California, it’s lower than it’s been historically; it’s lower than when I was governor. If you looked at the spending in the general fund, it’s lower (proportionally) going back all the way to Reagan …

“Basically, relative to our wealth, we’re investing at very similar levels to what it’s been historically in California.”

Thursday’s unveiling of the governor’s budget plan was his first official fiscal presentation since voters approved his Proposition 30 tax increases in November. During the campaign, Brown had said that if voters supported the tax measure, he would invest the new revenue in schools while holding tight on other spending.

Those promises came before Democrats secured historic supermajorities in both the Assembly and state Senate, prompting many to wonder whether Brown would ditch his pledge of austerity in favor of restoring previous spending cuts to social services that were unpopular with many Democratic constituencies.

Brown, however, said again Thursday that he intends to keep the fiscal reigns tight, comparing himself at one point to a mechanical governor, a device that keeps an engine from going too fast.

“I’m determined to avoid the fiscal mess the last few governors have had to deal with. And the only way to avoid it, is to hold the line, by exercising a common sense to how we spend our money,” Brown said, noting that an uncertain economic recovery and potential actions by the federal government or the courts could place California at risk for future fiscal troubles.

“Fiscal discipline is not the enemy of Democratic governance, but rather its fundamental predicate,” Brown said. “Fiscal discipline, balance, allows us to take care of the people over time instead of just having a momentary rash of excitement, (and) then we pay with a hangover several years later.”

In November, the nonpartisan Legislative Analyst’s Office projected that the state would face a $1.9 billion deficit next fiscal year. But Ana Matosantos, Brown’s finance director, said Thursday that state officials have reassessed how much special fund borrowing needs to be repaid this year and revised some projections, leading her office to conclude that the state, at this point, is not facing a deficit of any kind.

“Under the governor’s budget,” Matosantos said, “there is not a $1.9 billion problem, but we’re essentially balanced.”

This is despite the governor’s plan to raise spending on K-12 education and expand Medi-Cal as part of implementation of the Affordable Care Act. For the first three years, the federal government will pay for the expansion of Medi-Cal to people who live at 138 percent of the federal poverty line. In subsequent years, the federal government won’t pay the entire bill, but will pay at least 90 percent of the cost.

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