Schwarzenegger Signs New CA Budget

After contentious negotiations that stalled California’s new budget by nearly a month, Governor Arnold Schwarzenegger a $105.3 billion budget package on July 31 that included spending cuts and borrowed money to keep the state afloat.

There was no new funding allocated for the California Film Commission in the budget. Under the new California Performance Review report that was released August 2, 2004, the Labor and Economic Development Department. The CPR is an advisory document that will be the subject of public hearings and discussion during the coming year. It is currently unclear which of the CPR suggestions will be adopted by the state government.

The Governor struck deals with key constituencies to reduce current spending with the promise of additional dollars in future years. The deals included temporary cuts made to schools and local governments with the promise that the state would return more money to them in the future.

The Governor and local governments agreed to take a $2.6 billion cut in local government spending over the next two years in exchange for a constitutional amendment prohibiting the state from cutting them again, unless there is a three-fifths vote from legislature. The Governor and legislative leaders agreed to amend this deal to allow the states to borrow from cities and counties with a two-thirds vote from legislature and only twice every 10 years.

In the final weeks of the budget, the Republicans also hammered away at two key labor bills – SB 1419 (Alarcon –No contracting out bill) and SB 796 (Dunn – Private Attorney General Bill) – calling for their repeal. While SB 1419 made it through the Budget process untouched, SB 796 advocates engaged in a touch negotiations to narrow the scope of the bill and put forth procedural requirements before a private attorney general action could be brought in court. You may read the provisions of the new Private Attorney General Act on line under SB 1809 (Dunn) which is expected to be signed into law. Advocates had planned and expected to clean up some provisions of SB 796, however, we did not condone the use of the budget to reform an important labor bill.

A major victory for organized labor was restoration of the 3.8 million dollars to the Institute for Labor and Employment at the two UC campuses. The Governor initially slashed the programs in December (cutting half of its funding), and he proposed eliminating the entire program in his Budget that was released early this year. Advocates in the field and in Sacramento worked hard all year to ensure that the Legislature restored the monies. Assemblymember Simitian, Senator Scott, and Speaker Nunez, played keyed leadership roles in ensuring that the monies were restored and kept in the final budget. For their work they should be thanked.

For further analysis of the California budget, click here.

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