2006-07 Budget

The Legislature and the Governor came together on a bipartisan basis enacting the State Budget before the June 30th deadline.

The budget (AB 1801, Laird-D) authorized total spending of $127.9 billion, of which $101.3 billion is from the General Fund and $26.6 billion is from special funds. The Governor line-item vetoed $112 million ($62 million General Fund). Spending under the budget was an increase by over nine percent between 2005-06 and 2006-07.

The budget included a substantial increase in education spending. It allocated $8 billion in new funds for K-14 Proposition 98 education, resulting in an over 11 percent increase in K-12 per pupil funding relative to the level provided in the 2005-06 Budget Act. It also provided large funding increases for the University of California and California State University, including funding in lieu of planned fee increases for 2006-07. The budget package also rolled back community college fees from $26 to $20 per unit beginning in spring 2007. It provided $40 million in Proposition 98 General Fund support to backfill the foregone fee revenue.

In the transportation area, it provided the full $1.4 billion annual Proposition 42 transfer of sales taxes on gasoline to fund transportation programs, and it repayed $1.4 billion of past Proposition 42 related loans.

In the health and social services area, the budget package included (1) one-time funding for hospitals to increase patient capacity to meet health care emergencies such as an avian flue pandemic, (2) increased funding for county block grants for California Work Opportunity and Responsibility to Kids, child welfare services, and foster care, and (3) funding for pass through of the federal January 2007 Supplementary Security Income cost-of-living adjustment which, under the terms of the 2005-06 budget package, had previously been delayed until April 2007.

The budget included significant funding increases for corrections to cover higher inmate population and health-related costs.

The budget devoted $2.8 billion in General Fund revenues to the repayment of budgetary debt which had been incurred in previous years. About one-half of the total is for the prepayment of Proposition 42 loans from transportation (cited above), and the remainder is for local governments, schools, and special funds.

The bills which comprise the 2006-07 budget package include:

2006-07 Bills in Budget Package
AB 1801 Laird 2006-07 Budget
AB 1811 Laird Budget revisions
AB 1802 Budget Committee Education
AB 1803 Budget Committee Resources
AB 1805 Budget Committee Local government
AB 1806 Budget Committee General government
AB 1807 Budget Committee Health
AB 1808 Budget Committee Human services
AB 1809 Budget Committee Revenues
SB 1132 Budget Committee Transportation
SB 1137 Ducheny Proposition 36 reforms

The following legislation were the trailer bills to the above budget package:

Trailer Bills
SB 1131 Senate Budget and Fiscal Review Committee Education Funding
SB 1135 Senate Budget and Fiscal Review Committee Worker Transportation Grant Program
AB 1535 Nunez Instructional School Gardens Program
AB 1813 Assembly Budget Committee Hazardous Materials Tax