Resolution R-5-2007
STATE BUDGET DEFICIT
Adopted by Delegates to the LWVC Convention, May 20, 2007
Whereas, State structural deficits ranging from $3 billion
to $5 billion are expected to continue between now and 2010 (according
to the Legislative Analyst's Office);
Whereas, Although the economy has recovered from the downturn
in 2000, the prospects for “growing out” of this deficit are not likely
and the establishment of prudent reserves may not be achieved, even
with any number of transfers from other funds (e.g., transportation);
Whereas, Cuts in operating programs proposed in the 2007-2008
May Revision target those most in need and make only a small contribution
toward balancing the operating budget; and
Whereas, The League of Women Voters of California supports
measures to ensure revenues both sufficient and flexible enough to meet
the changing needs for state and local government services, which include
long range finance methods that meet current and future needs while
taking into account the cumulative impact of public debt, and ensure
adequacy of revenues by having sources with bases as broad as possible
consistent with fairness, such as reducing reliance on such volatile
sources as income taxes and sales taxes; therefore, be it
Resolved, That the delegates of the 2007 LWVC Convention call
upon the Governor and state legislative leaders to:
- Give priority to eliminating the ongoing structural deficit
- Not make early repayments on the deficit reduction bonds
- Increase revenues (roughly equivalent to the Vehicle License Fees (VLF) that were reduced) through sources that would diversify the revenue mix to reduce the reliance on income and sales taxes
- Use new revenues to address priorities such as global climate change that would have additional benefits of changing behavior
- Review existing tax incentives (tax expenditures) to identify those that are ineffective or no longer needed, and include a sunset provision for any new incentives.