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Photo by Carlos Avila Gonzalez / The San Francisco Chronicle
Donntai Chung, 5, helps his mother, Sophia Chung, pick up some fruit from the Holy Family Day Home child care center's farmers' market. Gov. Jerry Brown's 2012-13 budget plan eliminates 71,000 child care subsidies
Chronicle staff writer Victoria Colliver contributed to this report.
Gov. Jerry Brown released his budget plan Thursday, proposing more deep cuts to state health and welfare programs next fiscal year while warning that spending on schools, universities and courts will be reduced by billions if California voters refuse to pass his tax proposal in November.
The plan assumes that the taxes are passed, leaving funding for higher education and courts steady while K-12 school spending increases. But the state's welfare-to-work program, CalWORKS, would be slashed by nearly $1 billion, 71,000 child care subsidies would be eliminated and publicly funded health care would see deep reductions.
"These are painful reductions - mothers and kids will be getting the same welfare check in real dollars that they got in the '80s, and the same for the elderly, blind and disabled," Brown said. "These are not nice cuts, but that's what it takes to balance the budget."
The governor also is proposing to consolidate or eliminate scores of state boards, departments and agencies. He also is proposing eliminating, suspending or loosening nearly all state mandates on local governments.
Brown had planned to release his 2012-13 spending proposal next week, but it was accidentally posted online by someone on Brown's staff Thursday, forcing the administration to scramble to present it early.
Brown said he wants the Legislature to get to work on his plan immediately and pass the major cuts by March 1. But he already is facing resistance as state Senate President Pro Tem Darrell Steinberg, D-Sacramento, said he wants to wait until at least May, when the state's revenue picture is clearer, to consider any cuts.
"We're not going to make those cuts to CalWORKS and child care in March. No," he said. He said the final budget, due in June, probably will look much different from Brown's proposal.
In all, the proposed budget would increase general fund spending from its current $86 billion to $92.6 billion. The general fund is the pot of money that pays for most of the government's basic programs and is funded through the general statewide taxes, including sales and income taxes.
Since 2007, general fund spending has been reduced by nearly 20 percent because of the economic meltdown. It also includes a $1.1 billion reserve.
Brown's Department of Finance projects next year's deficit will be $9.2 billion, including $4.1 billion from this current year, and he wants to close it largely through a combination of the tax increases and spending cuts.
The governor's tax proposal would generate nearly $7 billion in new tax revenue annually for five years - $2.2 billion of it for schools and the rest for the general fund - through increased income taxes on the wealthy and a half-cent hike in the state sales tax.
Still, Brown said the state needs to cut spending by $4.2 billion to bring the budget into balance.
The CalWORKS cut of $946 million would come by shortening the length of time most adults could be on the program, from four years to two years. Assistance for children would be reduced by $71 per month.
Child care subsidies, which are currently offered to about 363,400 children, would be cut for 71,000 kids, a $450 million savings.
Mike Herald, a legislative advocate for the Western Center on Law and Poverty, said the CalWORKS and child care cuts will devastate families trying to lift themselves out of poverty. They come on top of more than $1 billion worth of reductions to the same programs over the past two years, he noted - including changes last summer that already reduced the amount of time families can stay on CalWORKS and how much assistance they can receive once they start working.
"After those time limits went into effect in July and the grant limits, we saw a 200 percent increase in the number of homeless families in Los Angeles County," he said.
Medi-Cal also would see deep cuts. The governor wants to reduce spending by $678 million by moving people that receive both Medicaid and Medicare funding onto managed care plans; reduce payments to community clinics by $28.8 million; and make $75 million worth of reductions to the rates the state pays laboratories and some other medical service providers.
It could get worse
If voters reject the governor's tax plan, things would be even worse.
Brown wants to include automatic triggers in the budget that would slash school spending by $4.8 billion, university spending by $400 million and courts by $125 million. The triggers would also include millions of dollars worth of reductions to park rangers and state firefighters, and the elimination of state-funded seasonal lifeguards.
Brown said his plan will soon eliminate the state's "structural deficit" - an annual, automatic shortfall - but he did not say specifically when. Republicans had mixed responses to the governor's plan, with some praising his proposals to cut spending but arguing that the improving economy makes tax increases unnecessary.
"The governor's plan is a good first step but relies far too much on a $7 billion tax hike that voters are likely to reject," said Senate Republican leader Bob Huff, R-Diamond Bar (Los Angeles County).