Jerry Brown

California Gov. Jerry Brown, waits to answers questions during a news conference where he announced a budget agreement last June. Brown will release his latest budget proposal Thursday. (Renee C. Byer

Capitol Alert
By Jim Miller and David Siders
January 5, 2016 5:34 PM

  • Democratic governor will release spending plan Thursday
  • Revenue running above last year’s estimates
  • Brown and fellow Democrats in Legislature have butted heads on spending proposals

Gov. Jerry Brown will release his budget proposal for the coming year Thursday, amid a strong state economy and fiscal experts’ predictions that tax revenue will continue to surpass estimates from last June.

If Brown’s past budget proposals are any clue, the Democratic governor will warn that it all could quickly go south.

The fourth-term governor’s spending plan is unlikely to include big new policy proposals. But there still will be areas that interests with a stake in state spending will be scrutinizing Thursday.

Here are five of them:

Revenue and reserves

The current budget approved last June essentially used the revenue assumptions in Brown’s revised May budget. Through December, though, personal income tax revenue – the largest source of money for the state general fund – was running about $1.3 billion higher, based on preliminary numbers by the nonpartisan Legislative Analyst’s Office.

Brown’s budget will include its own revenue estimates by his Department of Finance. Based on recent history, the administration’s numbers will be lower.

Revenue predictions will underpin negotiations on how much more the state can spend. They also will determine what lawmakers need to set aside in a voter-approved fund designed to pay down state debt as well as cushion against future drops in revenue.

How much will that be? In November, the analyst’s office estimated that lawmakers will need to put another $2.2 billion into the reserve for 2015-16, for a total of $5.9 billion. Brown’s proposal will include its own estimate for the reserve.

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