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 The plan suggests they would like to tap much of the state's
expected surpluses and comes as Governor Jerry Brown, a Democrat,
prepares his initial budget plan for the 2014-2015 fiscal year
beginning next July. He will present his plan to the legislature
next month, followed by a revised plan in May.
After the state's budget watchdog agency last month projected a $5.6
billion reserve for California's next fiscal year if the state's
finances improve and its current fiscal policies do not change,
Brown urged lawmakers to be cautious in calling for spending
increases.
California is seeing a budget surplus after years of deficits
following austerity measures and tax increases approved by voters
last year.
The tax increases included a hike in the personal income tax rate of
the state's wealthiest taxpayers, which is benefiting state coffers
thanks to a strong stock market.
Brown has said the state should be using revenue from the wealthy's
capital gains prudently, notably for building reserves and paying
down debt. Brown's spokesman for budget matters said those two goals
are guiding his budget planning.
Outlining the budget priorities of Assembly Democrats, Speaker John
Perez said in a statement that he expects to work with Brown and
other top lawmakers to have a budget deal for the 2014-2015 fiscal
year in place by the legislature's June 15, 2014, deadline.
Assembly Democrats did not detail how much in increased spending
they would seek for the next fiscal year. But they projected their
budget blueprint would build reserves and produce an $8 billion
reserve in the state's fiscal 2016-2017 year.
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The Assembly Democrats' blueprint "makes prudent use of one-time
funds," Assemblywoman Nancy Skinner, chair of her chamber's budget
committee, said in a statement.
California's budget watchdog agency last month recommended the state
leaders prepare for the next economic downturn by setting aside
money to establish an $8 billion reserve by 2016-2017. The agency
also urged paying down unfunded retirement liabilities at the
state's pension funds for teachers and university employees.
California could end its current fiscal year with a reserve of $2.4
billion due to stronger than expected revenue from income derived
from capital gains, instead of the $1.1 billion projected in its
current budget, according to the Legislative Analyst's Office, which
tracks the state's finances.
The state controller's office said on Tuesday that state revenues
since the start of the current fiscal year through November were
$228.1 million ahead of projection in the budget.
(Reporting by Jim Christie; editing by Matthew Lewis)
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