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Changes To State Budget Process Rejected

Voters defeated Proposition 31, which would have made major changes to the state budget process, including establishing a two- year budget cycle.

The initiative was rejected by a margin of 60.3 percent to 39.7 percent, with vote-by-mail ballots and 84.2 percent of the state's precincts partially or fully counted, according to figures released early today by the Secretary of State's Office.

Proposition 31 would also have:

-- prohibited the Legislature from creating expenditures of more than $25 million unless offsetting revenues or spending cuts are identified;

-- permitted the governor to cut the budget unilaterally during fiscal emergencies if the Legislature fails to act;

-- required performance goals in state and local budgets;

-- required publication of all bills at least three days before a legislative vote; and

-- given counties the power to alter state laws or regulations related to spending unless the Legislature or state agency vetoes the changes within 60 days.

The measure would have resulted in decreased state revenues and commensurate increased local revenues, probably in the range of about $200 million annually, beginning in the 2013-14 fiscal year, according to an estimate from the Legislative Analyst's Office and Director of Finance Ana J. Matosantos.

There was also the potential of decreased state program costs or increased state revenues. There would have been increased state and local costs of tens of millions of dollars annually to implement new budgeting practices, but over time, the costs would moderate and potentially have been offset by savings from improved program efficiencies, according to the estimate.

Garry Toebben, president and CEO of the Los Angeles Area Chamber of Commerce, said Proposition 31 would have brought "accountability and transparency to state government" and shifted "more decision making to local governments," and made "common sense changes in how decisions are made and money is appropriated in our state capitol."

Former State Superintendent of Public Instruction Jack O'Connell called Proposition 31 "a poorly drafted, unworkable measure that will harm our ability to properly fund our schools."

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