Crafting Budget Priorities in a Changing State

By Daryl Kelley

Dec. 2, 2005 12 AM PT

Times Staff Writer

California’s continuing transformation to an older, less-educated and more ethnically diverse state will heighten demand for better schools and more medical, child and elder care over the next 15 years, according to a new report.

The nonpartisan California Budget Project, aiming to influence the state agenda next year, emphasized that top state officials need to focus not only on rebuilding California’s aging roads and infrastructure, but also on the needs of a rapidly changing population.

Gov. Arnold Schwarzenegger is promoting a statewide public works program that may be financed by a bond sale of $50 billion or more. But Barbara Baran, the author of the report, said social services deserve equal footing with reconstruction projects.

“Our primary objective is to wave a flag for policymakers,” Baran said. “There’s a lot of emphasis on doing something about our aging infrastructure. But that needs to be placed side by side with our other major challenges.”

California is experiencing “a changing of the guard among generations,” she said, “from the baby-boom generation to those that follow.”

Over the two decades ending in 2020, the number of state residents age 65 and older will double to 6 million, Baran said. And, as the baby boomers move off the historical stage, a young generation of workers must develop skills to compete in a global economy, she said.

“We have to take care of our past and our future at the same time,” she said. “The sheer numbers of elderly will put real pressure on medical and in-home services. At the same time, our new workers must achieve for us in the future -- they’re going to be paying our Social Security.”

California’s population is projected to grow by about 10 million people, to 44 million, over two decades. And policymakers need to address the fact, Baran said, that the groups experiencing the greatest growth are the least-educated.

Latinos, about one-third of the state’s population at the turn of the 21st century, will make up 43% of residents in 15 years, while the number of whites will drop from nearly half the population to one-third. The white population will actually decline 8% during the same period, according to state projections.

In addition, most California public school students will be Latino in less than a decade. This is a concern, the report said, because just 25% of Latinos score at “proficient and above” in English on state achievement tests, compared with 27% of blacks, 58% of whites and 62% of Asians.

Likewise, the rate of Latino enrollment in state colleges and universities is far lower than for whites and Asians.

College “enrollment and graduation rates must increase among Latinos and blacks, in particular, if California is to meet the future workforce needs of its employers,” the report said.

H.D. Palmer, a spokesman for the state Finance Department, said Schwarzenegger was focusing on both infrastructure and human services as he finishes the preliminary budget he will present to the Legislature in January.

Hurricane Katrina was a wake-up call for addressing the weakness of Sacramento-San Joaquin Delta levees, Palmer said.

But the governor also widened eligibility for the Healthy Families medical care program by 125,000 children this year, and backed $50 million to improve low-performing schools, Palmer said.

“I don’t think it’s an either-or choice,” Palmer said. “It’s a question of balance.”

Assemblyman John Laird (D-Santa Cruz), chairman of the Assembly Budget Committee, said the budget project’s report was “exactly right.”

“We need to better align the budget to our changing demographics,” he said. “We have to plan for the burgeoning senior population, and we just aren’t at this point.”

In-home service, rather than institutional care, is the cheapest way to meet the needs of more and more frail seniors, Laird said. And extra English instruction to nonnative speakers is also desperately needed, he said. The governor blocked progress in both areas this year, Laird said.

A new gas tax is also needed to rebuild roads, he said. But he said Schwarzenegger opposes any tax increase, favoring only hikes in college tuition, which limit access by poorer students.

“People are willing to invest [with tax hikes] if they know what they’re getting,” Laird said. “But that conversation hasn’t been held yet with the people of California.”

Dowell Myers, an urban planning professor at USC, said the new budget report raises important policy questions: What are our top statewide priorities, and who should pay for them?

“This will be a factor in the gubernatorial campaign next summer,” Myers said. “We should ask: Why should the budget be balanced on the backs of our children? Why shouldn’t it be balanced on the strong shoulders of the older generation that has fared so well in California?”

For three decades, Myers said, baby boomers haven’t paid enough taxes to support schools, social services and public works. Elected officials have let them get away with it, he said, and now want to borrow $50 billion to $100 billion that our children would have to pay off.

“We need public officials who will put the needs of our children first,” he said. “It’s been the present versus the future for too long. The problem is, children don’t vote.”

BEGIN TEXT OF INFOBOX

Big and diverse

California’s population growth outpaced the rest of the nation throughout the 20th century, giving it more diversity than any other state.

California’s total and racial/ethnic populations compared with total populations of other U.S. states*

*--* California 33,871,648 Texas 20,851,820 New York 18,976,457 Florida 15,982,378 California white 15,816,790 Illinois 12,419,293 Pennsylvania 12,281,054 Ohio 11,353,140 California Latino 10,966,556 Michigan 9,938,444 North Carolina 8,049,313 Virginia 7,078,515 South Carolina 4,012,012 California Asian 3,648,860 Oklahoma 3,450,654 Oregon 3,421,399 Arkansas 2,673,400 Utah 2,233,169 California black 2,181,926 Nevada 1,998,257

*--*

* 2000 census data

By 2020, the largest racial or ethnic group will be Latino.

Breakdown in California

*--*

2000

White: 47.1%

Latino: 32.6%

Asian: 11.0%

Black: 6.5%

Other: 2.8%

*--*