Gov. Jerry Brown says he has 600 bills on his desk, but many he will not sign because “there’s not 600 problems that we need those solutions for.” We suggest he locate and sign two bills, SB14 and SB15, that help solve two of his biggest problems: the annual budget mess and the lack of public trust in Sacramento’s leadership, which voters say are closely linked.
Performance-based budgeting, the focus of SB14, has been recommended in California by independent commissions for years. It requires the state to identify program objectives when it spends money, as well as how much meeting those objectives should cost, and requires analysis of whether these goals are met. This approach is not fancy or complicated – in fact, it’s Budgeting 101 in the private sector, and 25 states already use it in some form.
SB15 focuses on another big problem by requiring multiyear planning for budget revenues and expenses. The state needs tools to get a handle on its damaging boom-or-bust tax and spending cycles, and this is a good start. Again, you’d be hard-pressed to find major entities, public or private, that don’t do this, and it is high time it be required in California.
In one sense, these bills represent basic blocking and tackling, fiscal reforms that the state sorely needs. But at a broader level, signing them sends a message to frustrated Californians that Sacramento will get its fiscal house in order and begin to rebuild trust with the people. We co-chaired California’s first-ever statewide deliberative poll this summer, in which a scientifically selected, random sample of 412 Californians was given an in-depth opportunity to deliberate on the state’s problems and potential solutions. It wasn’t a pretty picture on the problem side:
— More than 2 out of 3 California voters question whether the Legislature can “get important things done.”
— Nine out of 10 voters don’t trust the Legislature to make difficult budgeting decisions without showing exactly how major new programs or tax cuts will be paid for.
— Voters believe 39 cents of every new tax $1 will be wasted.
Still, these weekend deliberators said, they have faith that things can be changed and improved, calling for precisely the kind of measures now on the governor’s desk, and then some:
— 83 percent said each annual budget should be accompanied by a long-term plan for revenue and expenses (as called for in SB15).
— 88 percent would require legislators to say how they will pay for new programs or tax cuts of $25 million or more.
— 84 percent would limit one-time revenue “spikes” to one-time expenditures, such as paying down debt or filling the state rainy-day fund.
In effect, Californians were saying to their Legislature: We want to trust but verify good fiscal practices. And, by the way, with greater transparency and controls of these kinds, the people said they were optimistic that many of the state’s problems could begin to be solved.
Perhaps California has embarked on a season of reform – beginning with redistricting and open primaries on the political side, and now with an opportunity to enact performance-based budgeting and long-term financial forecasting on the fiscal side. These small steps could be the tugboats that move our ship of state in a new direction, and begin restoring people’s trust and confidence in California governance.
This article also appeared in today’s San Francisco Chronicle.
David Davenport, a research fellow at the Hoover Institution, and Lenny Mendonca, a director of McKinsey and Company, co-chaired the bipartisan California Deliberative Poll project. Both are members of the California Forward Leadership Council.