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LAO Provides Alternative Actions to Balance Budget

At the request of Senator Mark Leno (D-San Francisco), the Legislative Analyst’s Office (LAO) identified possible budget cuts, including $1.2 billion to health and human services programs, to address the state budget deficit without additional tax revenue.

In the event that California lawmakers and voters reject Governor Jerry Brown’s proposed tax extensions, this letter from the LAO describes expenditure reductions; shifts, or transfers, of existing state or local funds to benefit the General Fund; and increases of non-tax revenues that could balance the budget.

The $13.5 billion in budget-balancing alternatives are spread across all major policy areas: K-14 education ($5.2 billion), higher education ($1.1 billion), health and social services ($1.2 billion), criminal justice and the judiciary ($2.6 billion), general and local governments ($1.8 billion), and resources/transportation ($1.6 billion).

Health and social services budget alternatives include:

  • Reducing state participation in In-Home Supportive Services (IHSS) provider wages to minimum wage ($300 million)
  • Eliminating the California Food Assistance Program and Cash Assistance Program for immigrants and legal noncitizens ($190 million)
  • Reducing CalWORKS earned income disregard ($180 million)
  • Eliminating full-scope Medi-Cal benefits for newly qualified aliens and permanent residents ($120 million)

Additional cuts to an already decimated FY 2011-12 budget will have devastating reverberations across the state on the most vulnerable of populations. Governor Brown has repeatedly urged lawmakers for a special election that would include a ballot measure to extend temporary tax increases for five more years.

The letter to Senator Leno is available for download here.

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