Peninsula lawmakers react to budget

Gov. Gavin Newsom released his revised $300.6 billion spending plan Friday, with a record-breaking $97.5 billion surplus slated to fund education, infrastructure, health care — and yes, another round of stimulus checks.

With legislators across the state vying for a slice of the pie, the Peninsula’s state Sen. Josh Becker and assemblymembers Kevin Mullin and Marc Berman shared their thoughts on the proposal, and how some of that money should be spent locally.

“Because of the size of the surplus, the Gann limit is in play, and that is going to dictate, frankly, that we spend money on infrastructure and think it’s inevitable that we are going to be giving some money back to the taxpayers,” Mullin, D-South San Francisco, said.

The state appropriations limit, also known as the Gann limit, restricts how the state can spend funds that exceed a threshold adopted in the late 1970s. Infrastructure spending and rebates are key exemptions (and the reason for last year’s “Golden State Stimulus” checks that went to the majority of Californians).

“This is an extraordinary opportunity to invest in our infrastructure and invest in one-time expenses,” said Mullin, who advocated for spending on the ongoing Caltrain electrification project among other transportation needs in the Bay Area, in addition to climate resiliency efforts.

Lawmakers will be meeting in coming weeks ahead of a June 15 deadline when the budget must be passed, though, discussion may continue past that point. A key point of contention will be how the stimulus checks will be structured.

In the face of rising gas prices, Newsom has advocated for a plan that would tie the rebate to vehicle ownership. Californias would get $400 for each car they own, up to two cars. Mullin said he was against the idea, and said the money should go “to those who need it most.”

“I think the Assembly Democrats weren’t in agreement with the governor that it should be linked to car ownership, and the size of the check,” he said. He also voiced strong opposition for the governor’s plan to temporarily repeal the gas tax, another idea aimed at addressing fuel costs.

“There’s no guarantee that the actual gas prices would come down, there’s a chance that gas would cost just as much but we’d be losing a key revenue source for our transportation infrastructure,” he said.

Becker, D-San Mateo, took a less definitive stance on the rebate structure, saying he was “not sure the way that [the governor] has been talking about structuring [the stimulus] is the optimal way.”

He said climate resilience, education and mental health and homelessness spending were his top priorities.

“We don’t know if we’ll have a surplus again, certainty not a surplus like this,” he said. “It’s a sign that some are doing well, we know that others are not doing as well, we need to make sure that we use this money wisely both to help people specifically as well as to invest for the future.”

He said the surplus provided an opportunity to build on investments related to housing and homelessness, big issues for the Bay Area. He also said infrastructure investment like adding electric car charging stations were needed, and money should go to reducing costs for building electrification.

He mentioned he would advocate for the county’s Office of Education to get a funding increase, and investments in youth mental health were important.

The surplus will also provide opportunities to pay down the state’s debt and grow the state’s rainy day fund. Newsom indicated $23 billion would be contributed to the state reserves, available in the event of an economic downturn some warn could be looming.

“I’m of the mindset to always put more into reserves just because we have this cyclical economy, and maybe we’re coming to the end of a very long 12-year upcycle,” Becker said. “At the very least we will have $30 billion plus in reserves, which is good, but, for me, the more the better.”

Mullin said paying down the debt and ensuring healthy reserves was something “absolutely to be mindful of,” and that it’s been a focus for Assembly Democrats.

“This is an extraordinary budget surplus we have … but it’s also a reminder of how volatile our revenue streams are in California,” he said. “We could very well be in a deficit situation in the coming years should there be an economic downturn.”

In an emailed statement, Berman, D-Menlo Park, said he looked forward to the budgets “massive infrastructure investments” reaching his district.

“In particular, I applaud the governor’s proposed investments in combating climate change, with a significant focus on drought, historic funding to transform public education, with additional investments to address the urgent crisis of youth mental health,” he said, adding that the budget included unprecedented funding for “California’s most critical issue: homelessness.”

corey@smdailyjournal.com

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