Jesse Cheng’s Jab – Jerry’s (and the UC’s) Problem


UPDATED:  Gov Brown released a video message to accompany his announcement of the death of budget talks, re-emphasizing his points.  Note that at the end of his video, he says “we will protect…public universities”.  Not sure how he plans to do that, but that was put out there.  Assembly and Senate Democratic leaders argue that they will pass a balanced budget by June 15th.

The Los Angeles Times and Sacramento Bee just reported that Jerry Brown has declared budget talks with Republicans “halted” – which the Sac Bee has decided is the equivalent of “dead”.  The budget talks were directly related to putting tax extensions on the ballot to create revenue to fill in the 15.4 billion dollar gap left in the state budget.
Nobody knows what exactly this will mean, especially because Brown has not yet released his next steps.  However, a couple of things seem very likely.

1) Brown will pursue alternative paths to putting tax extensions (or increases, by November) by gathering signatures for a ballot initiative in November.  This would mean that the revenue generated from the taxes would not come in by the new fiscal year, and the Legislature would have to pass a “balanced budget” sometime in summer that would likely include huge cuts.  This means that California voters will be asked to sign petitions on whether they would like to see tax extensions in the ballot – and then asked to vote for them in November.

2) We will not have a balanced budget on time.  This seems to be a consensus opinion – now that revenue is not an option, Republicans and Democrats will be reluctant to implement large cuts in the budget, and are unlikely to make the budget deadline in July.

Which then means a couple of things seem likely for the University of California:

1) We will definitely have 500 million dollars in budget cuts from the State.  Which is something that we already knew, and Regents have begun to look at campus cuts and long-term revenue options, which included student fees and enrollment cuts last Regents meeting.  We can expect plans for campus cuts to come up in the May Regents meeting.

2) UC may have to look at even more extensive budget cuts for next year – the number thrown out has been from anywhere to 300m to 500m dollars in more cuts.  Because Jerry Brown can’t count on the tax revenue from being there, and he’s still constitutionally obligated to pass a balanced budget by the summer – he might look towards higher education to take more of the cuts to create a balanced budget.  Jerry Brown’s statement today directly tied the funding of higher education to the passage of tax revenue, stating “The Republicans demand that out-of-state corporations that keep jobs out of California be given a billion-dollar tax break that will come from our schoolchildren, public safety and our universities. This I am not willing to do.”

3) Even more extensive budget cuts may put all budget options back on the table for the UC – including student fees and enrollment cuts for long-term cost-cutting or revenue.

With the budget talks as halted/dead UC students will be greatly impacted by the legislature, if their next steps will include cuts to higher education, and how the Regents and UCOP will react to those next steps.  Additionally, UC students are going to have to look at the Brown tax extensions, now that they’re going in front of the public under the referendum process, and whether students will decide to support those revenues in November.

This is the article from the LA Times – which also include’s Gov. Brown’s statement: http://latimesblogs.latimes.com/california-politics/2011/03/gov-jerry-brown-declares-budget-talks-halted.html

And this is the breaking news from Sac Bee’s Capitol Alert: http://blogs.sacbee.com/capitolalertlatest/2011/03/brown-budget-talks-with-republ.html

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