Jerry Brown

Gov. Brown looks to fix Rainy Day Fund measure

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Looks to fix 2010’s ACA 4 that will appear on November ballot

by Brian Leubitz

Gov. Brown has always been fond of the concept of a rainy day fund. He’s included the concept on many occasions, speeches, budgets, etc. Add “special session” to that list:

Gov. Jerry Brown on Wednesday called a special session of the Legislature to replace the “Rainy Day Fund” measure on November’s ballot with a dedicated reserve to let the state to pay down its debts and unfunded liabilities.

“We simply must prevent the massive deficits of the last decade and we can only do that by paying down our debts and creating a solid Rainy Day Fund,” Brown said in a news release, which accompanied a proclamation convening the special section next Thursday, April 24. (Josh Richman / Political Blotter)

It seems that pretty much everybody in Sacramento, across the political spectrum, supports the move, with Richman pulling supportive quotes from the Speaker, Senate minority leader, and the Chamber of Commerce. But, of course, they all have different ideas of what this means. Brown wants to account for the wild swings in revenue we get due to stock options and the like, while Huff and the Chamber focus first on spending one-time revenue on ongoing expenses.

What exactly this means for the November ballot is unclear. Any changes could push the ballot measure to 2016, but there is some flexibility with a lot of time still remaining.

One thought on “Gov. Brown looks to fix Rainy Day Fund measure”

  1. The Republican-backed plan, drawn up during the administration of Arnold Schwarzenegger as part of a compromise with Democrats, would require the state to set aside a portion of its overall revenues in a fund that could only be touched during a natural disaster or fiscal emergency.

    Brown’s plan, by contrast, only requires the state to set aside money for the fund during years when income spikes from investments – so-called capital gains – amounts to more than 6.5 percent of its revenue. Such investments are projected to make up about 7.7 percent of the state’s general fund revenue this year.

    California set up a rainy day fund in 2004, but contributions were not enshrined in the constitution, and the state has not contributed to it since 2007.

    http://www.reuters.com/article…

    Sounds to me like the ‘Pubs want to fund the reserve with a mandatory minimum each year – even if that means cutting the budget somewhere – while Brown wants to skim “surplus” revenue off the top for that purpose.

    It will probably end up being a combination of both – they’ll just have to negotiate the size of the “minimum” annual allocation. How much will the ‘Pubs demand in return for their three votes?

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