We missed reporting on the California Assembly Speaker’s announcement of the Assembly Democrats budget proposal thatÂ was releasedÂ on Tuesday. From the Speaker’s release:
SACRAMENTO — Assembly Speaker John A. PÃ©rez today announced the California Jobs Budget, a new proposal to solve Californiaâ€™s budget deficit while creating private sector jobs and preventing economically harmful cuts to schools, public safety and the stateâ€™s safety net. Joining PÃ©rez was Assembly Budget Committee Chair Bob Blumenfield, who will preside over the public hearing and review process for the California Jobs Budget.
â€œCalifornia has to produce a budget that promotes job creation and makes economic sense,â€ PÃ©rez said. â€œWe shouldnâ€™t make budget decisions that cut jobs and short change our overall recovery and long term growth. The California Jobs Budget will protect and create 465,000 jobs in the private sector and local communities while also protecting funding for schools, public safety, and a basic safety net.â€
â€œThe California Jobs Budget will be presented to the Legislature and the public for a full and transparent review,â€ Blumenfield said. â€œThe Jobs Budget matches the priorities of the people of California, and it reflects the contributions of thousands of Californians who have testified and participated in over 50 Budget Subcommittee hearings, 12 full Budget Committee hearings, and seven Budget Forums held throughout the state.â€
The California Jobs Budget closes the stateâ€™s $17.9 billion General Fund shortfall and ends the year with a $1 billion final reserve. The centerpiece of the California Jobs Budget is a $10.1 billion Jobs and Economic Stability Fund that will protect against the loss of 430,000 private sector, local community and school jobs in the Governorâ€™s May Budget Revision, and which will also generate tens of thousands of new jobs.Â The California Jobs Budget provides $1.5 billion for targeted Jobs Initiatives, repays debts to local governments and schools to avoid massive local government layoffs, and maintains critical employment services and training programs that get people back to work and keep them on payrolls and off government aid.
â€œThis is a creative approach at solving the two most urgent problems facing our state: creating jobs and closing our deficit,â€ PÃ©rez said. â€œThe California Jobs Budget gets us through a difficult period and puts us much further ahead on the path to economic recovery by focusing on jobs.â€
The Jobs Package:
- Puts job creation and protection first. With a $10 billion Jobs and Economic Stability Fund that promotes and protects 465,000 private sector jobs, school, and local government jobs
- Invests in critical job training programs at California community colleges for job training and retraining programs for unemployed job seekers
- Jump starts California’s clean and green industries and other targeted jobs investments.
- Protects Critical Education Dollars.Â Rejects $3 Billion of the Governorâ€™s devastating cuts to education and instead meets the Proposition 98 guarantee and puts a stop to the endless cuts to K-12 and Higher Education in order to protect California’s future.
- Rejects Phony Cuts to Safety Net. Â Rejects the Governorâ€™s slashing of safety net programs, which would actually cost the state more, and instead maintains welfare to work, childcare, and cost effective alternatives to expensive nursing homes.Â
- Includes No New Broadbased Tax Increases.Â Makes no broadbased tax increases, and instead delays corporate loopholes and closes the California Oil Severance Tax loophole.
In order to maximize the immediate impact from creating and protecting jobs, the Jobs and Economic Stability Fund borrows $8.7 billion from the California Beverage Recycling Fund and, similar to the Governorâ€™s plan, $500 million from the Disability Insurance Fund.
An Oil Severance Tax, required by law in every other oil producing stateâ€”including Texas and Alaskaâ€”will generate $900 million in 2010-11 and billions more each year for the Jobs and Economic Stability Fund. While the oil severance fee will generate job-creating revenue, numerous studies have found that oil companies in California are not highly taxed compared to other states.Â Because the oil market is global in scope, it means there should be no impact from closing the severance loophole on the price of oil. The Oil Severance Tax in the California Jobs Budget is subject to approval by a majority vote of the Legislature.Â Governor Schwarzenegger signed a similar majority vote tax mechanism into law in March.
The California Jobs Budget would also delay the implementation of corporate tax loopholes that were created in previous budget solutions, which would generate an additional $2.1 billion.
Funds from the Jobs and Economic Stability Fund will be allocated as follows:
- $1.1 Billion Targeted Jobs Investment to develop and strengthen California industries, including green and clean tech industries. This also provides a potential funding source for numerous Democratic and Republican jobs bills making their way in the Legislature.
- $900 million Repayment to Local Governments.Â Protects thousands of local police, fire, and other local jobs by repaying $900 million owed to local governments for past mandates.Â
- $3.8 Billion Repayment to Local School Districts. Â Protects tens of thousands of jobs for teachers, aides, and counselors by fully funding Proposition 98 and eliminating portions of the â€œEducation Credit Cardâ€ rather than the Governor’s proposal to cut schools by $2.8 billion, which leads to thousands of lost jobs.
- $900 million to Protect Higher Education’s Role in Our Economic Future.Â Provides $1 billion to restore recent education cuts and fully fund the UC and CSU to prevent the devastating economic and jobs impact of decimating Higher Education. Also protects access to higher education by reducing the Governorâ€™s student fee hike by 50 percent, which will save UC students $628 and CSU students $202.
- $1.9 Billion Keeping Working Poor Parents in Workforce.Â Maintains necessary childcare programs funded through CalWORKS and Prop 98 to ensure working parents can stay employed and over 50,000 small business childcare providers can stay in business.
- $1.4 Billion Getting Californians Back to Work.Â Invests in critical employment services to move people from welfare to work and to retrain workers at Community Colleges.
- $100 Million for Oil Producing Communities. Provides $100 million to local communities impacted by the new Oil Severance Fee.Â Â Experts project the Oil Severance Fee will have little impact on jobs statewide, but there may be localized impacts.Â Therefore, an ongoing $100 million allocation is included to offset any negative impacts of the fee.
- $200 million for the Bottle Bill.Â Separate from the Jobs and Economic Security Fund, the package increases funding by $200 million for the Beverage Container Recycling program to strengthen and stabilize the state’s recycling program. California’s recycling program was nearly bankrupt due to the downturn in the economy, and this increase in support will provide long term secure funding for the program, which will protect local conservation corps, protect bottle manufacturing jobs through processing fee relief and drive green technology investment through product development grants.
Website of Speaker John A. PÃ©rez: www.asmdc.org/speaker