Ted Gaines Spending Limit will Force Politicians to Get Deficit Under Control


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Ted Gaines, CA District 4 Assemblyman
December, 2007

Recently, the non-partisan Legislative Analyst's Office (LAO) issued their annual forecast of California's budget and fiscal situation, and the news was very grim.
In what should be a staggering wake-up call for my colleagues in the Legislature, LAO forecasts that California will face at least an $8 billion budget shortfall next year and multi-billion dollar deficits over the next several years unless lawmakers take action soon to get our financial house in order. Despite efforts this year to enact a state budget with a $3.6 billion reserve, California once again stands at the brink of a fiscal meltdown.

Yet the majority party in Sacramento continues to act as if they have their own printing press to make more money when we get into a budget crunch. On the very day that the report detailing our state's fiscal emergency came out, Democrats on the Assembly Health Committee pushed through billions of dollars in new government health care spending. It is simply unconscionable to even consider such massive new spending when our current financial house is in such disarray.

As a small business owner, I work hard each month to meet payroll and provide health coverage to my employees while staying in business. If there were a time when sales for my company declined, then I would cut back on my company's spending to avoid financial problems. I believe the state of California should operate no differently, stopping the out-of-control spending when tax revenue is down to avoid running up the deficit and incurring serious fiscal consequences.

I have introduced legislation that I believe will force lawmakers to operate more like a business when it comes to spending our hard-earned tax dollars. Assembly Constitutional Amendment 3 is important government reform legislation that I plan to reintroduce in January that will require lawmakers to better prioritize state spending to meet the people's needs.

Under ACA 3, the growth in state spending every year would be limited to the annual increase in population and inflation. By law, any excess revenue would be dedicated to our schools, a budget reserve, and tax relief for California families.

Nearly 30 years ago, California voters approved this strict spending limit at the ballot box, known as the Gann Limit. For a time, lawmakers were forced to keep spending under control, and return excess revenue to the people. Unfortunately, the politicians and the special interests wrote loopholes into the law over the years that have watered down the spending limit to the point where it is practically meaningless.

Now more than ever, lawmakers must get serious about embracing fiscal discipline and spending the people's money responsibly. Tax-and-spend politicians in Sacramento must no longer be allowed to spend our tax dollars funding their irresponsible spending priorities as if it is their own personal slush fund.

Make no mistake, our state is facing a fiscal emergency that requires immediate action by the Legislature. We must take steps now to eliminate our structural budget deficit once and for all, before California falls over the cliff into the abyss of financial ruin. I believe ACA 3 will give us the tools to do just that and is the right approach for California taxpayers.