Plan for rainy-day fund heads to ballot after legislative approval
The Legislature on Thursday unanimously approved a new proposal to help cushion the state from economic downturns and pay off billions of dollars in debt and long-term costs.
The measure, which would modify the state’s Constitution, will be placed on the November ballot. It received bipartisan support from lawmakers, and Gov. Jerry Brown has pitched the proposal as a key way to stabilize California’s rocky finances.
If approved by voters, the state would contribute money to a reserve fund every year. Deposits could be suspended and the accumulated money could be withdrawn during a recession to prevent cuts to government services.
More money would be used to pay off debts incurred during the state’s recent budget crises and to cover costs such as public pensions.
According to administration estimates, about $2 billion would be set aside for those purposes in each of the next few years.
The final measure is the product of negotiations among the governor and Democrats and Republicans in the Legislature.
“When you have a robust bipartisan discussion, you can make things better,” said Senate Republican leader Bob Huff (R-Diamond Bar).
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