2017 State Budget

Governor Jerry Brown released his 2017-18 State Budget proposal on January 10, 2017. The budget proposal release begins the six month negotiation process that culminates in a final budget deal in late June.

Governor Brown’s 2017-18 Budget remains committed to protecting four priorities: growth for education, creation of the state’s first earned income tax credit, a minimum wage increase, and expansion of health care coverage to millions of Californians.

Protecting these priorities however comes at some cost this year as the state projects that without some tempering of anticipated spending increases and pulling back on one-time spending commitments made last year the state would face a $2 billion deficit. The two factors creating the deficit are stated to be lower than expected revenues and a shortfall in the Medi-Cal program. The Administration does acknowledge that California’s tax base is volatile and with the coming tax receipts, there may be greater revenues than projected today, in which case proposed cuts could be avoided in the May Revise.

The Budget Summary does acknowledge the change in federal administrations and the many unknowns posed, however no assumptions are made about alleged changes to programs.  Per the Budget Summary, “the [Brown] Administration stands ready to build on what has worked, support changes and efficiencies where appropriate, and play a constructive role to protect and enhance the lives and health of Californians – with the fiscal constraints facing the state.”