SACRAMENTO, Calif. /California Newswire/ — Moving swiftly to keep California’s fiscal house in order, Governor Edmund G. Brown Jr. on Friday signed two bills that will help maintain the state’s balanced budget and vetoed a third bill that would have undermined investor confidence in California’s bonds.
“Job number one is protecting the integrity of our balanced budget, because it directly impacts California’s financial stability,” said Governor Brown. “The two bills I signed today provide critical revenues that will keep our budget balanced, and I thank the Legislature—both Republicans and Democrats—for working together to pass them.”
“I am vetoing a third bill that would have undermined investor confidence in California by altering the budget’s mechanisms for automatic trigger cuts. The trigger mechanisms were adopted when I signed the budget and were essential to improving our credit standing. Indeed, our no-gimmick, on-time budget was the reason S&P assigned its highest rating to the short-term notes sold this past week—the first time that’s happened since 2007,” said Governor Brown.
The Governor signed SB 335 by Senator Ed Hernandez (D-Los Angeles) and Senate President pro Tem Darrell Steinberg (D-Sacramento). This law will provide additional funds to hospitals and protect health care services for low-income, vulnerable patients and children by extending the Hospital Quality Insurance Fee. SB 335 will raise $7 billion in revenue, bring in an additional $6.1 billion in new federal funds and will save the state’s General Fund more than $850 million over a 30-month period. This amounts to over $500 million more in savings to the State General Fund than previously estimated.
Governor Brown also signed ABX1 21 by Assemblymember Robert Blumenfield (D-Van Nuys), which extends a tax on Medi-Cal managed health care plans for an additional year. This law will help maintain health coverage for thousands of children and teenagers through the Healthy Families Program. It will raise more than $200 million in new revenue, bring in an additional $300 million in federal funds, and save the General Fund $103 million this year.
“These bills represent a solid partnership between private business and the state to fund vital healthcare services while continuing to live within our means during these difficult economic times,” said Governor Brown. “They also show what the legislators can accomplish when they work together as Californians, not mere party members.”
The Governor vetoed SBX1 6 by the Committee on Budget and Fiscal Review, which alters the trigger cuts mechanism in the 2011-2012 state budget. The bill would have required the Director of the Department of Finance to consult with legislative leaders on alternatives to the cuts outlined in the budget and thereby raise questions that could affect the sales of Revenue Anticipation Notes and General Obligation bonds.