Governor Edmund G. Brown Jr. this week signed his final budget, a package that includes three California Chamber of Commerce-supported budget trailer bills which incorporated language from job creator bills.
• AB 1808 (Committee on Budget) extends and improves the Career Technical Education Incentive Grant program, which provides students with necessary training and education to prepare them for a variety of career options.
• AB 1809 (Committee on Budget) appropriates $10 million to create the California State Pathways in Technology program, to create public-private partnerships to prepare students for high-skilled, high-demand jobs in technology, manufacturing, health care and finance.
• SB 871 (Committee on Budget and Fiscal Review) extends California’s tax incentive for motion pictures and television productions for an additional five years.
Career Technical Education
AB 1808 and AB 1809 contain similar provisions to CalChamber-supported and identified job creators, AB 1743 (O’Donnell; D-Long Beach) and SB 1243 (Portantino; D-La Cañada Flintridge), respectively.
The CalChamber supported the budget trailer bills because they include robust and ongoing funding for career technical education (CTE), and science, technology, engineering and mathematics (STEM) programs. Permanent support for CTE from the CTE Incentive Grants and from the Strong Workforce program will bring certainty to the many districts and communities working to facilitate long-term planning, hiring and design for these important programs.
Reconciling these updated and new programs to deliver their goals for schools and employers will take diligent cooperation and focus by the Legislature, administration, Department of Education, community colleges, local school districts, and employers.
The CalChamber stands ready to assist in the implementation challenges, in the ultimate interest of improving high school completion and proficiency, and employer talent recruitment needs.
Extension of Film Tax Credits
SB 871 included provisions from job creator bills AB 1734 (Calderon; D-Whittier) and SB 951 (Mitchell; D-Los Angeles), extending California’s tax incentive for motion pictures and television productions for an additional five years. This tax incentive has proven effective in maintaining jobs in California and growing jobs in this industry.
In 2014, the State Legislature enacted an expanded motion picture and television production tax credit program, which has proven to be a success in keeping more film and television productions—and the jobs these productions generate—here in California.
The current program has a sunset date of July 1, 2020. However, planning for both motion picture and television productions typically occurs several years in advance, and productions rely on the certainty that the incentive will be available, as location decisions are made.
Fiscal Prudence
The Governor’s final budget for 2018–19 continues to emphasize fiscal prudence, adding to the balance of the Rainy Day Fund approved by voters in 2014. The balance will be $13.8 billion, according to the Governor’s office.
If the current economic expansion continues to the end of the 2018–19 fiscal year, it will have matched the longest in post-World War II history.
Education
The final budget increases K–12 school funding by more than $4,600 per student compared to 2011–12 levels. The $78.4 billion in funding for K–14 schools marks a 66% increase in annual funding compared to seven years ago, according to the Governor’s office.
The state will fully implement the Local Control Funding Formula, an allocation that eliminates most categorical funding programs in favor of aiming supplemental funding toward poor students, English learners and children in foster care.
The budget will increase funding for California’s university and community college systems with no tuition or fee increases and establishes a new online community college.
Since 2012, the University of California has received $1.2 billion in new funding. Over the same period, new funding has amounted to $1.7 billion for the California State University system and $2.4 billion for the community colleges.
Infrastructure
The budget provides the first full year of funding under SB 1, the CalChamber-supported Road Repair and Accountability Act. New transportation funding for 2018–19 totals $4.6 billion to be used to fix neighborhood roads, state highways and bridges, fill potholes, ease congestion in busy trade and commute corridors, and improve/modernize passenger rail and public transit.
Housing/Poverty
The budget allocates $5 billion to help deal with affordable housing and homelessness. Local governments will receive $500 million to help their immediate efforts to assist homeless Californians.
The administration reports the state will provide billions to increase the state minimum wage; increase the Earned Income Tax Credit program; expand health care coverage to millions more Californians; restore low-income health benefits eliminated during the recession; boost CalWORKs grants; and increase child care and early education provider rates and the number of children served.
Climate Change
The budget includes a $1.4 billion cap-and-trade spending plan to invest in programs that continue the state’s efforts to reduce carbon emissions and support what the administration refers to as “climate resiliency efforts.”
The plan includes $210 million for forest improvement and fire prevention projects that protect California forests from wildfires and $334.5 million for the California Energy Commission and California Air Resources Board to begin implementing a multi-year effort to speed sales of zero-emission vehicles through vehicle rebates and infrastructure investments.
More Information
For the full text of the Budget Act and associated legislation, visit www.leginfo.legislature.ca.gov.
Additional details on the 2018–19 State Budget can be found at www.ebudget.ca.gov.
