August 1, 2003
| TO: | Cla Members/ Systems/ Network Contacts |
| FROM: | Mike Dillon, Lobbyist Christina Dillon, Lobbyist |
| RE: | News From The Capitol |
I. GOVERNOR SIGNS BUDGET - $15. 8 MILLION FOR PLF PROTECTED
On Saturday, Governor Gray Davis signed the $100 billion Budget bill, AB 1765 and subsequently released a modest list of reductions, highlighting areas where he had utilized his so-called "blue pencil authority." We are pleased to report that the Public Library Foundation has been protected at the $15.8 million baseline figure that the legislature submitted to the Governor in AB 1765. In addition, no other library programs were reduced by the Governor, including the Transaction Based Reimbursement or State Library Administration. Instead, the Governor chose to make reductions, mostly technical in nature, totaling approximately $1 million in areas such as health and human services and corrections.
At the time of the Budget signing, the Governor released a document noting all of his official actions on the bill (the document may be obtained at www.dof.ca.gov). In his overview, he notes, "This Budget reflects many months of negotiation between the Governor and the Legislature. While it relies on larger borrowing and other one-time solutions, this budget is built on the May Revision. It is balanced, including $2 billion reserve in the current year, and it protects the Governor's K-12 education priorities."
Thank you to all of our CLA members and friends who took the time to write the Governor and request that he leave the PLF in tact at $15.8 million.
II. NOTE OF CAUTION
Mixed in with the good news above must be a note of caution. As part of this year's Budget agreement, the legislature "gave the Director of Finance limited mid-year authority to address unanticipated expenses by reducing expenditures in other areas." This morning we asked a top official in the Department of Finance if this language means the Director could reduce the PLF and any other programs without legislative authority. The answer was "yes, if deficiencies occur or revenues do not meet expectations." If, for example, federal funds did not materialize as anticipated, this would allow the Director of Finance to make necessary reductions to offset this loss of revenues. The DOF official further added, "There has been no discussion at all on how the Director intends to do deficiencies or shortfalls." You will recall that in December of 2002, the Governor proposed Mid-Year revisions to the 2002-03 Budget, which was subject to legislative approval in January of 2003. Many of the Governor's cuts, including his proposed reduction to the PLF, were ultimately rejected by the legislature. This year it appears the sole discretion for Mid Year cuts will rest with the Director of Finance.