California has "reached a point where its underlying expenditures and revenues are roughly in balance after years of multi-billion-dollar deficits," analyst Mac Taylor said.
He commended the Democratic governor for emphasizing fiscal restraint and urged lawmakers to consider Brown's education reforms.
Last week, Brown released a $97.6 billion state spending plan for the upcoming fiscal year that projected a $1 billion reserve. Two months ago, Taylor had projected a more cautious outlook that forecast a $1.9 billion deficit.
Taylor said Monday that higher tax revenues, increased savings and repayment of loans account for the differences.
Brown's finance director, Ana Matosantos, said last week that the two offices use slightly different figures and spending estimates. For example, the governor's office has different information on how much money will be generated by the elimination of community redevelopment agencies and how to use newly approved tax revenue, she said.
Under Brown's spending plan, California's budget will increase by nearly $5 billion, largely due to voter approval of his sales and income tax initiative, Proposition 30. By comparison, the state's shortfall stood at $25 billion when Brown took office two years ago.
Despite the fresh tax revenue, Brown warned his Democratic colleagues who control both houses of the Legislature to refrain from overspending. He wants to build a reserve to cushion against future downturns and make strides toward paying down the state's bond obligations.
His plan for the fiscal year that begins July 1 includes $2.7 billion more for K-12 education and community colleges, bringing state and local spending to $56.2 billion.
The University of California and California State University systems each would receive an additional $250 million, which includes $125 million promised for not raising tuition this academic year. California Community Colleges, which has 112 campuses, would receive a $197 million boost.
Brown also projected modest increases in health care and social service programs.
The governor committed to making national health care reform work in California by expanding Medicaid coverage for low-income Californians. He set aside $350 million for the Medicaid expansion/
Lawmakers have until June 15 to send their own budget plan to the governor.