BILL ANALYSIS ------------------------------------------------------------ |SENATE RULES COMMITTEE | AB 1781| |Office of Senate Floor Analyses | | |1020 N Street, Suite 524 | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ------------------------------------------------------------ CONFERENCE COMPLETED Bill No: AB 1781 Author: Assembly Budget Committee Amended: Conference Report No. 1 Vote: 27 - Urgency PRIOR VOTES NOT RELEVANT CONFERENCE COMMITTEE VOTE : 4-2, 7/14/08 AYES: Ducheny, Machado, Laird, Leno NOES: Dutton, Laird SUBJECT : 2008 State Budget SOURCE : Author DIGEST : Conference Amendments delete the prior version of the bill expressing the intent of the Legislature to enact changes relating to the Budget Act of 2008 and, instead, provide for the specifics of the Budget Act of 2008-09. This conference report, combined with changes proposed in AB 88, will comprise the Budget Act of 2008. The Conference Report enacts the 2008 State budget NOTE: Refer to the Senate Budget and Fiscal Review Committee analysis for details of the budget. ANALYSIS : This bill provides for a balanced budget as required by the State Constitution. The budget, also modified by changes proposed in AB 88, is based on $105.3 CONTINUED AB 1781 Page 2 billion in available General fund resources, and contains $103.4 billion in expenditures. The final General Fund Reserve is approximately $1 billion. In terms of all funds (General Fund, special funds, and select bond funds) the proposed budget is approximately $140 billion. Budget Process Overview With the submission of the Governor's Budget, which is required by January 10 of each year, the chair of the Senate Budget and Fiscal Review and Assembly Budget Committees each introduce a Budget Bill which contains appropriations to finance the program levels proposed in the Governor's budget. Throughout the spring, and with the assistance of committee consultants and the Legislative Analyst, who prepares a detailed analysis of the Governor's budget, the fiscal committees of each house of the Legislature hold hearings to determine if changes should be made in the Governor's budget. At these hearings, representatives from the state department whose budget is being heard, the Department of Finance (DOF), the Legislative Analyst, and the public may be called upon to provide official testimony. Changes desired by the Administration concerning events occurring after the Governor's budget are submitted and included in "Finance Letters" addressed to and considered by the Senate Budget and Fiscal Review Committee and the Assembly Budget Committee. In mid-May, the DOF updates its estimates of current year and budget year revenues, expenditures (including any final Administration expenditure proposals) and surplus. This provides the Legislature with the most current estimate of resources that will be available for expenditure. At the completion of the hearings, the Senate and the Assembly passes its Budget Bill. A Conference Committee of six legislators is chosen to receive differences in the two bills and to incorporate a "Conference Committee Version" into one of the bills. The bill is then sent to the floor of both the Senate and the Assembly and, if passed by two-thirds, is enrolled and sent to the Governor. If it is not passed, a new Conference Committee is formed and the CONTINUED AB 1781 Page 3 conference process is repeated. Sometimes it has become necessary for the Senate Pro Tem, Assembly Speaker, Senate Minority Leader, Assembly Minority Leader, and the Governor to meet to resolve major issues. The Legislature is required under the State Constitution to pass the Budget by June 15th of each year. Upon receipt of the Budget Bill, the Governor meets with his advisors to make reductions or eliminate particular items of expenditure (known as the item-veto). The Governor then signs the Budget Bill and it becomes the Budget Act. Under the State Constitution, the Governor must sign the Budget by June 30th of each year. The Legislature may then consider overriding any vetoes the Governor has made and may do so by a two-thirds vote of each house. FISCAL EFFECT : Appropriation: No Fiscal Com.: No Local: No DLW:cm 8/29/08 Senate Floor Analyses SUPPORT/OPPOSITION: NONE RECEIVED **** END **** CONTINUED