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Revised State Budget Provides Hope

— 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 in particular could face billions in cuts unless

the state brings in more money, he said.

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

Democratic lawmakers and Brown 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 is proposing 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."

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