California Has a Budget Deal but Little to Celebrate

There was good news late Thursday: Legislative leaders and Gov. Pete Wilson finally reached broad agreement on a $68-billion 1997-98 state budget that is balanced and provides record funding for California public schools. But this cannot be a cause for self-congratulation. They should have done it weeks ago.

On Thursday, the budget was 38 days late. By the time the agreement is signed into law next week, the delay will have caused even more unnecessary hardship for hundreds of firms that do business with the state and have not been paid since June 30.

Agreement was achieved when the leaders predictably though unevenly split the difference on two programs that had divided them. The governor won $100 million to continue a program of state aid to local police. In return, Assembly Speaker Cruz Bustamante (D-Fresno) won a $33-million state food stamp program for limited numbers of legal immigrants who have lost federal food stamps.

All of this could have, and should have, been achieved by July 1, if not earlier. There is plenty of blame to go around and there are no heroes in this story.

Several political ploys caused the major delays. Well into the new fiscal year, Wilson suddenly demanded a $1-billion income tax cut. When Democrats rejected it, Wilson decided unilaterally to pay off a $1.3-billion debt to the state employees’ pension system all at once rather than spreading it out over 10 years. Bustamante countered with his demand for the food stamps.

The pension decision gobbled up all of the extra cash the state has reaped with a booming economy. Suddenly, the Legislature had to slash more than $1 billion from the budget it had worked on for seven months.

The only face-saving for the governor and the Legislature lies in the fact that California schools will have enough money to expand the class-size reduction program and increase the school year by a day or two. And not that much commendation is deserved even there: California voters dictated the allocation of new funds to the schools when they passed Proposition 98 back in 1988. The money couldn’t have been spent for anything else.

The best that Sacramento’s leaders can do now is to put the cap on an otherwise hold-the-line budget and begin constructive discussions about how to spend a financial bonanza next year--on time.