This story was reported for the San Diego News Network on March 2, 2010.
An entry of California Budget Crisis Diaries would be incomplete without some controversy. So here’s your controversy this Tuesday: State workers are banking.
Aside from that, a Wall Street Journal reporter is giving a lesson in economics to student protesters, more cuts are being made to programs for California’s disabled population and a new Assembly Speaker is making promises on his first day.
Here’s your state budget round-up:
Big payouts: The state may be in a hefty deficit and Californians may be struggling, but others are cashing in.
According to California Watch, some California employees are retiring on more than a dime these days.
“Amid a crippling fiscal crisis, managers throughout California’s government have routinely allowed their employees to amass unused vacation time, enabling hundreds of workers to end their public-service careers with payouts topping $100,000, a California Watch investigation has found.
One worker combined vacation and compensatory time to walk away with more than $800,000, records show.”
Regardless of the number of big payouts some California workers are seeing, the investigation found that violations may have been made.
“Many of those cash payments appeared to violate rules designed to limit how much vacation time state workers can accumulate during their careers. Most employees are allowed to bank 80 days worth of unused vacation, but records show that supervisors routinely allow them to exceed that amount.”
Students are still angry: As students and universities prepare for the infamous “Day of Action to Defend Public Education” rally on Thursday — one The Wall Street Journal reporter gives California a quick lesson on recessions and consequences.
William McGurn writes that though students are protesting, it’s important to note that California simply, doesn’t have money, and it’s based on the state’s tax system. He reports on the findings by the California Tax Commission.
“The governor set up the commission precisely because the boom-and-bust cycle for state tax revenue is making it increasingly difficult for the state to fund government commitments, including higher ed. The gist of the problem was aptly summed up in its report: ‘Tax rates have been increased on steadily narrowing tax bases.’
Tax bases narrow as marginal rates go up and people and businesses struggle to make a go of it. Some fail; others move to Texas. Either way, the result is what California has been seeing: higher unemployment, slower economic growth, and less tax revenue to fund the state’s public institutions.
When things get as bad as they have in California, students whose education is underwritten by this tax revenue find themselves paying higher tuition—and faculty and staff may find themselves out of a job.”
What’s the point of McGurn’s report then? Simple. He ends it with some “advice” for those who plan to protest Thursday.
“Keep your clothes on. Don’t fight the police. And maybe put down your Saul Alinsky long enough to read the California tax commission’s findings about what dependence on high marginal income tax rates is doing to public universities like yours.”
(SDNN plans to cover the protest at SDSU and UC San Diego, so check back on Thursday for coverage.)
Calif. continues cuts for developmentally disabled: California lawmakers have sent Gov. Arnold Schwarzenegger a budget-related bill that continues a spending cut for programs that assist the disabled.
The state Senate passed the legislation Monday after it was approved last week in the Assembly.
The bill continues a 3 percent reduction for provider reimbursements at the Department of Developmental Services. It will affect 21 regional centers that care for the developmentally disabled.
The move is expected to save $61 million in the fiscal year that begins July 1. That reduction represents just a fraction of California’s $20 billion budget deficit.
Lawmakers have yet to finish voting on several other budget bills, including those that are designed to increase revenue.
New speaker: In other budgetary news, the newly sworn in Assembly Speaker John Pérez is promising more transparent talks.
According to The Sacramento Bee, Pérez promised that “Budget hearings and deliberations will be broadcast on the Web and, when possible, on television. Budget information will be posted on the Internet.”
He also said he and his colleagues would work on making job creation a top priority, to help stimulate California’s devastated economy.
“Our number one focus must be to get Californians working again. Our economic woes and budget deficits will not be fixed until the job market recovers, the unemployment rate falls, and the spirit of entrepreneurship is restored across our state.”
Pérez reiterated a promise that the budget “will not be written behind closed doors in Big 5 meetings” with Gov. Schwarzenegger and legislative leaders.”
Pérez was sworn in Monday as California’s first openly gay Assembly Speaker.
Assemblymember Lori Saldaña (D-San Diego) snapped photos of the swearing in on her Blackberry. Check out the photo gallery on SDNN’s A More Perfect Union blog.
Associated Press contributed to this report. Hoa Quach is the political editor for the San Diego News Network.