Why CA Needs Reform

It's been years since California's budgets were last balanced without relying on an unsustainable blend of gimmicks and illusions—many of which have disintegrated within weeks of budget passage. For more than a decade, these short-term efforts to prop up the state's budget have been masking a growing – and much larger – problem: Our state's ever-widening structural deficit.

In 2011 California faces a major budget shortfall for the third year in a row: $28.1 billion over eighteen months. Our credit rating is one of the lowest in the country, driving up the cost of borrowing when we can least afford it. Public services are eroding, and local governments and schools are unable to plan from year to year because a significant portion of their funding currently is controlled by the state.

It comes as no surprise that in 2008 Pew Center for the Study of the States and Governing Magazine said California had one of the worst fiscal systems in the nation. Without major changes in state spending or tax policy, the Legislative Analyst's Office estimates California will continue to have shortfalls of roughly $20 billion each fiscal year for the next five years.

There is no doubt Californians have become keenly aware of these problems. In a recent California Forward public opinion survey, 78 percent of Californians said government dysfunction and the budget mess are serious, and 80 percent said these problems directly affect them.

The vast majority of Californians – 86 percent – also believe we can fix the problem, and in the last three years, it has become clear we have a foundation to build on. In 2008 and 2010, voters approved reforms that changed the primary system and increased the independence of the political redistricting process—both significant steps toward improving voters confidence in our state's governance system. Comprehensive fiscal reform should be next.

While strengthening fiscal discipline in Sacramento, California also needs to return responsibility for essential services like education and public safety back to local communities, in a way that ensures local programs work well for the Californians they serve, local governments have the flexibility to work together and local leaders are held accountable for results.

There's more we need to do, but these reforms alone have the power to dramatically transform how California is governed, and we could have the opportunity to enact them this year.