Gov. Jerry Brown has proposed a plan to close the projected
nearly $25 billion budget deficit for fiscal year 2011-12 through a
combination of spending cuts of $12.5 billion and
”
temporary
”
tax increases of $12.5 billion.
Dear Editor,
Gov. Jerry Brown has proposed a plan to close the projected nearly $25 billion budget deficit for fiscal year 2011-12 through a combination of spending cuts of $12.5 billion and “temporary” tax increases of $12.5 billion. There is a more straightforward solution – but it would take intestinal fortitude by the governor and state legislators to implement.
Using the government’s numbers, with the temporary taxes already in place for 2010-11, there will be a General Fund deficit carryover of $3.4 billion into 2011-12. Without a continuation of the tax increases into 2011-12, the General Fund revenues are projected to be $83.5 billion. This would leave $80.1 billion in net revenues to meet FY 2011-12 General Fund expenditures.
A review of the history of General Fund expenditures shows that most recently, specifically in 2004-05, the actual expenditures were $79.8 billion, i.e., less than the projected net revenues, without continuation of the temporary tax increases, for 2011-12.
An alternative solution to the current budget crisis would be to use the 2004-05 budget expenditures as a “modified zero-based” budget for 2011-12. That is, as a starting point, set each agency and department budget equal to the expenditures that it recorded in the earlier fiscal year. From this starting point, every “necessary” increase in budget must be matched by an equal or greater decrease in budget from some other line item.
This solution would result in the elimination of waste, fraud and abuse in the state budget in order to find the funding for any “necessary” budget increases from 2004-05 spending levels.
Francis Ryan, Morgan Hill
