The state also continues to face a “wall of debt” that Brown has talked about, which includes at least $300 billion in unfunded pension liabilities and retiree health care, and about $10 billion the state owes the federal government for unemployment insurance claims.
Paying it down will be a challenge, however. With the nonpartisan Legislative Analyst’s Office predicting budget surpluses for the first time in years, Brown will face mounting pressure from Democratic constituencies to increase spending.
Those knocking on the governor’s door include groups seeking the return of money borrowed from special funds to help balance the budget, such as $1 billion in gas taxes intended for road repairs and $500 million in cap-and-trade funds intended for environmental protection.
Prominent environmental groups recently sent Brown a letter calling on him to commit the cap-and-trade money to environmental preservation or risk “losing credibility” on the issue. He also has been dogged by those critical of his decision to allow hydraulic fracturing, or fracking, of oil and natural gas in California.