By Sharon Bernstein
SACRAMENTO, Calif. (Reuters) - California Governor Jerry Brown on Thursday proposed a new state budget that increases public spending in education, healthcare and infrastructure, the latest indication of the most populous U.S. state's rebound from years of economic doldrums.
Brown, a Democrat, proposed a new budget plan for fiscal year 2016-17 that topped $122 billion in spending from what is known as the general fund, the money appropriated by the legislature and approved by the governor each year, and a total state budget of $170.7 billion.
The spending increase - 6 percent in the general fund and nearly 2 percent in the overall budget - reflects unexpectedly higher revenue at the end of 2015. But Brown warned against overspending and advised that the state stay focused on real needs.
"It's always a temptation to let your roof deteriorate while you take a vacation or send your kids to college or go out to dinner," he said.
The 77-year-old, who also served as governor from 1975 to 1983, has been notoriously tight-fisted since returning to office in 2011, reining in the state's liberal Democratic majority lawmakers to build a rainy day fund and hold down expenses after facing down a $27 billion budget deficit.
The governor's budget would deposit $2 billion in the state's rainy day fund, bringing the balance to 65 percent of its target.
The budget would also boost school spending to $10,591 per student, an increase of nearly $3,600 from four years ago. Tuition at the state's public universities would remain flat.
Over the next decade, Brown plans to provide $36 billion to improve state infrastructure, including highways, roads and public transit.
Since voters in 2012 approved a temporary tax increase that allowed the state to cover its budget gap and restore some social services, California's finances have stabilized.
But Brown's fiscal caution has left many advocates for the poor and disabled angry, and frustrated some of his fellow Democrats in the legislature.
The proposed budget increases the state’s minimum wage to $10 per hour and provides a second year of funding to the state’s poorest working families through a tax credit. It would also provide a cost-of-living increase for aged, blind and disabled Californians.
Brown's proposal must still be approved by the legislature and will likely change by the end of June, when a spending and revenue package for the 2016-2017 fiscal year must be enacted.
(Additional reporting by Robin Respaut and Rory Carroll in San Francisco; Editing by Diane Craft and Matthew Lewis)