State Budget

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What will be the state of the UC in five to 10 years?

Byuclafaculty

Yours truly was asked by the Daily Bruin (5-26-11) to respond to the following question: What will be the state of the UC in five to 10 years? Below is my response: DANIEL J.B. MITCHELL, Professor Emeritus at the Anderson School of Management and the Luskin School of Public Affairs “Never (make) forecasts, especially about the future,” advised Sam Goldwyn (the G in media company MGM). I will take his advice and instead suggest two scenarios. I don’t know which one UCLA, and the larger UC, will follow. But I know which one I prefer. The first scenario is an…

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Pension Initiative OK’d for Circulation

Byuclafaculty

The pension initiative that was filed by legislative Republicans negotiating with Gov. Brown on the state budget now has a title and summary language and so it can be circulated for the needed signatures. It includes UC and would override the Regents’ pension changes enacted last December. Like all initiatives, however, unless someone wants to spend $1-$2 million for commercial firms to get those signatures, it won’t go beyond this stage. The added summary language is below. The actual text of the initiative is below that:May 23, 2011Initiative 11-0007 (Amdt. #1-NS.) The Attorney General of California has prepared the following…

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Circulating Cap

Byuclafaculty

The initiative filed to place a formula cap on state spending can now be circulated with the summary and title below. As prior posts have noted, this initiative seems to have been filed as part of negotiations between Republican legislators and the governor regarding the state budget. It essentially rejuvenates the old Gann Limit concept that voters approved in the wake of Prop 13 but later gutted. Whether someone has the needed $1-$2 million to hire signature gathering firms is unknown. The governor said in his May revise oral presentation that he supports a cap. He did not specify the…

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Jerry Brown as the Terminator (of CPEC): LAO Objects

Byuclafaculty

The California Postsecondary Education Commission (CPEC) is among the boards and commissions the governor proposed in the May revise for termination. CPEC is supposed to coordinate among the public and private elements of higher ed. However, the Legislative Analyst’s Office prefers other options, or at least suggests such alternatives be considered. LAO’s position below: Options Related to Governor’s Proposal for CPEC Background We believe there are several critical coordination functions necessary to protect the state’s investment in higher education. Examples include data collection and analysis, planning and oversight, and review of new program and campus proposals. Some of these activities…

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Who Will Bail Out UC?

Byuclafaculty

The parking of a Hummer belonging to Lipstick Bail Bonds (slogan: “Kiss Jail Goodbye”) at the UCLA med center recently raises the issue of who bails out UC if the governor’s tax extensions-resumptions don’t pass. Students, apparently, will be the answer: UC tuition might jump 32% if tax proposal fails, official says UC President Mark G. Yudof tells regents that this fall’s 8% tuition increase may be dwarfed by an additional 32% midyear hike if Gov. Jerry Brown’s plan for tax extensions is not approved. By Larry Gordon, Los Angeles Times May 19, 2011 Reporting from San Francisco — University…

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LAO Points to Alternatives to the May Revise

Byuclafaculty

The Legislative Analyst’s Office (LAO) has prepared its analysis of the governor’s May revise proposal. It believes that recent increases in state income tax receipts are more heavily the result of capital gains than the governor does. In the short term, i.e., through the next fiscal year, the source of the revenue doesn’t much matter. However, the LAO believes that in the outyears (beyond 2011-12), less revenue can be expected than the governor’s projection would suggest. LAO provides a similar analysis of the corporate profits tax; it has a less rosy outlook in the outyears than the governor. The LAO…

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Wind or Windfall in the State Budget?

Byuclafaculty

There are constant headlines about a state revenue “windfall.” It refers to a projection that this fiscal year, the Dept. of Finance thinks there will be more revenue than it did back in January when Gov. Brown made his original budget proposal. The May revise was discussed in a prior post. It was noted that while more revenue was projected for the current year, it turned out that the general fund, viewed as a checking account, now seems to have been more overdrawn at the start of the fiscal year (July 1, 2010) than was thought in January. On the…

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Video: The Governor’s May Revise News Conference

Byuclafaculty

An earlier post on this blog analyzes the May Revise news conference held by Gov. Brown on May 16. There is video of that news conference on the governor’s website but – at least on my computer – it tended to pause and freeze. The version on the calchannel was even worse and caused a total crash at one point. So below is the video transplanted to YouTube by yours truly which works best. It is divided into 4 parts due to YouTube time limits. Part 2, it might be noted, contains a statement by the governor that he would…

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The May Revise

Byuclafaculty

Here is a preliminary look at Governor Brown’s May revise budget based in part on yours truly watching the media conference at which the May revise was presented and a look at the accompanying documents. For those concerned about UC in particular, there appears to be no change in the net $500 billion reduction previously announced. That reduction consists of a drop in the general fund contribution to UC plus the ending of federal stimulus funds. You can find this information at http://www.dof.ca.gov/budget/historical/2011-12/governors/summary/documents/BS_HED.pdf and http://www.dof.ca.gov/budget/historical/2011-12/governors/documents/May_Revision_2011-12_Summary.pdf At the more general level, let’s start with the observation that budget terminology in the…

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State Spending Cap Could End Up on Ballot: Background

Byuclafaculty

Tomorrow is the day Governor Brown is supposed to unveil his May-revise budget. Various elements have been leaking out to the news media. There was also an announcement concerning closing selected state parks which reflects an element of political theater as well as the reality of the continuing budget crisis. Earlier posts have noted that Republicans have indicated that they might accept a deal that would include putting on the ballot a state spending cap. By way of background, California has a state spending cap – the Gann Limit – passed by voters in 1979 in the wake of Prop…