California’s budget: Cleaning up the mess

Deltek Analyst Erin Brady reports.

The state of California’s budget finally seems to have caught a break after a long, tedious ordeal. The road to the completed budget certainly wasn’t easy. First came the $25 billion deficit, and then Governor Jerry Brown vetoed the budget presented to him by state legislators. The veto was California’s first in more than 100 years. Now, with the beginning of the fiscal year fast approaching, it seems California and Gov. Brown may be out of the woods. If we backtrack to late last year and address the enactment of Proposition 25, we can determine how California got into this seemingly endless mess.

Proposition 25 was passed in November 2010 and changed many aspects of California’s legislative process in an effort to speed up the budget-approval process. Prop 25 states that a two-thirds vote is no longer required for approval of budgets or budget-related items, and that a simple majority (50 percent, plus one) is sufficient. A two-thirds majority is still required for the raising of taxes. The proposition also states that if a budget is not passed by June 15, members of the legislature will lose pay, including salary and expenses, until the budget is passed. The resulting savings would be approximately $50,000 for each day past June 15 that a budget is not approved.

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