California Revenue Up, But Gov. Brown Still Pushing For Tax Hikes

   SACRAMENTO, Calif. (AP) -- Gov. Jerry Brown is betting that California continues its gradual climb from the depths of the recession but said Monday that even a multibillion dollar bounce in tax revenue will not close the state's budget deficit and he wants to keep pushing a series of tax increases.

   The Democratic governor released his revised budget proposal for the fiscal year that starts July 1, a spending plan that mixes hope for better days ahead with a warning about the future if the Legislature fails to enact his plan for higher taxes.

   Public schools will receive nearly $3 billion more under his plan but would be hit particularly hard if his call for higher taxes is rebuffed in the Legislature or by voters.

   The governor proposed spending of $88.8 billion, a nearly 5 percent increase over the budget he introduced in January. The boost was fueled by rising sales, personal income and corporate tax receipts -- the three main sources of the state's general fund.

   The governor expects an overall increase of $6.6 billion in tax receipts for the coming year.

   The rising revenue and spending cuts already enacted by Brown and Democratic lawmakers have reduced the projected deficit to $9.6 billion. It had been estimated as high as $26.6 billion at the start of the year.

   Noting the increased tax revenue, Brown proposed to slightly modify his call for a renewal of expiring tax increases. But he defended his decision to push ahead with the tax plan, saying the state faces deficits into the future.

   "California's finances were plunged into turmoil by the Great Recession and a decade of short-term fixes and fiscal gimmicks," he said during a Capitol news conference. "This is not the time to delay or evade. This is the time to put our finances in order."

   Brown and Democratic lawmakers want to renew increases to the personal income, sales and vehicles taxes that were approved two years ago but are scheduled to expire June 30. Brown had wanted the increases extended for five years.

   He said Monday he still wants to renew the increases to the sales and vehicle taxes this year but not the increase to the personal income tax. Instead, that increase would be reinstated for the 2012 through 2015 tax years.

   The additional revenue would mainly go to education and to pay for the realignment of public safety programs to local agencies. He argued that the relative tax burden would remain below historic levels.

   Without the renewal of the higher taxes, Brown said California faces a budget deficit of about $20 billion in two years.

   He would not say whether he had an alternate plan if Republican lawmakers continue to block his call for tax renewals.

   "I'm not going to give the Republicans a roadmap to ruin, I'm giving them a roadmap to success," he said. "I want to see balanced, honest budgeting, and that's what I'm proposing."

   Even though Democrats have majorities in the Assembly and Senate, two Republican votes are needed in each house to reach the two-thirds threshold to approve tax increases or place a measure on the ballot.

   Brown does not want lawmakers to authorize the tax extensions directly. Instead, he wants them to place the question before voters in a special election, perhaps this fall.

   It's not clear whether the parties will be able to agree on this or other aspects of Brown's plan by their June 15 constitutional deadline to pass a budget.

   (Copyright 2011 by The Associated Press.  All Rights Reserved.)