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$46.9 Billion in Cuts, $5 Billion in Tax Changes: California Lawmakers Pass Placeholder Budget to Secure Pay

California Lawmakers Pass Placeholder Budget with $46.9 Billion in Cuts, $5 Billion in Tax Changes

California’s $46.9 Billion Budget Cuts and $5 Billion Tax Changes Secure Lawmakers’ Pay

According to Mountain Democrat, in order to protect their pay while they continue talks with Governor Gavin Newsom California lawmakers have approved a placeholder budget plan. California lawmakers must approve a balanced budget by June 15 in order for them to be paid according to state law even if it is not complete. State senators receive a salary of $122,694 yearly while assembly members start at $128,215. California lawmakers now have more time to complete a deal with Governor Newsom as the new fiscal year begins on July 1. Significant funding reductions for prisons are part of the latest budget proposal which also aims to earn an extra $5 billion by suspending business deductions and tax credits one year earlier than the governor has scheduled but this budget has encountered resistance particularly from Republicans.

The budget process has changed significantly since 2010 when California voters passed Proposition 25. This proposition lowered the threshold for budget approval from a two-thirds majority to a simple majority and stipulated that budgets must be passed by June 15 for California lawmakers to keep getting paid. In 2011 former Governor Jerry Brown vetoed the 2011-2012 budget for generating too much debt which led to California lawmakers missing paychecks. California lawmakers subsequently sued and a judge ruled that as long as a budget meeting constitutional requirements is passed by the deadline they will continue to get paid even if the governor rejects it. The California Department of Finance has estimated the California lawmakers needs to find about $45 billion in budget solutions for the 2024-2025 fiscal year and $30 billion for the following year. The proposed budget aims to address this by reducing spending by $46.9 billion for 2024-2025 and $29.8 billion for 2025-2026. It also plans to withdraw approximately $2.3 billion from reserves for 2024-2025 and $11.7 billion for 2025-2026.

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$46.9 Billion in Cuts, $5 Billion in Tax Changes: California Lawmakers Pass Placeholder Budget to Secure Pay (PHOTO: Just The News)

California Budget Dispute: GOP Calls for More Cuts Amid $162 Billion Deficit Shift

Furthermore, republicans in the California lawmakers meanwhile contend that the proposed budget reflects the state’s financial situation incorrectly. They think that in order to maintain financial stability greater cuts are required. The budget was attacked by Senate Minority Leader Brian W. Jones a Republican from San Diego who described it as a “shell game” that hid the state’s financial problems. He cited a two-year shift in the budget from a $162 billion surplus to a deficit as proof of careless spending. The next several weeks will see more negotiations between Governor Newsom and Democratic lawmakers before the budget year closes on June 30. The objective is to come to a final agreement that strikes a compromise between the state’s financial requirements and obtaining the money required for vital services.

READ ALSO: California’s Shoplifting Crackdown: New Law Aims To Catch Online Thieves, But Will It Backfire?

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