George Deukmejian

35th Governor, Republican
1983–1991

State of the State Address

Delivered: January 9, 1990

Lt. Governor McCarthy, Mr. Speaker, Mr. President Pro tem, members of the Legislature, fellow constitutional officers, and fellow Californians:

As we begin the first year of the 1990s, Gloria and I want to wish all of you a new decade filled with hope, peace, continued prosperity and much happiness.

When I delivered my first State of the State address in 1983, our state had experienced an economic quake. For the past seven years, we have worked together to restore fiscal solvency, our credit rating, the economy and to create jobs, jobs and more jobs.

As a result, the California that was once headed for the poorhouse is now an economic powerhouse.

Back then, unemployment was 11 percent. We had no overseas trade offices, no tourism promotion program, no competitive technology, workfare, or Rural Renaissance programs. The agricultural industry was on the ropes. Our workers' compensation program was a mess, and prior to our administration, we had one of the highest tax burdens in the nation.

Since then, unemployment has been cut from 11 percent to 5.3 percent, and 2.7 million new jobs have been created for our people. And while the budget I inherited contained a $1.5 billion deficit, the budget I leave my successor will contain a substantial surplus.

WE have become a state of builders. All told, we have invested or plan to invest $44.6 billion to expand and improve California's infrastructure.

We have constructed or rehabilitated 1,133 lane miles of state roads and highways, including the addition of 478 miles of new roads in our system.

In 1983, California had just 12 state prisons to house dangerous criminals. Since then we have built 14 new prison facilities. That has enabled us to remove an additional 52,000 convicted criminals from neighborhoods to send them to state prison. And I will continue to push for a constitutional amendment that allows all able-bodied criminals to work and help pay the cost of their upkeep, just like the rest of us.

We had no integrated strategy to clean up toxic waste or reduce non-hazardous waste. In 1983, none of our state hospitals for the mentally ill was accredited. Today, all of them are accredited. We are providing $127 million this year to aid the homeless in our state. Our commitment to fighting AIDS and find a cure for that dreaded disease is unmatched by any other state. And this year, we will provide 20 million meals for seniors, as well as income security for more than 800,000 elderly, blind and disabled Californians.

Building on the progress of the eighties, it's time to turn to the challenges of the nineties.

We'll get nowhere fast if we don't do something about freeway gridlock.

Last year, we developed a major transportation improvement plan for the 1990s. This June, the voters will be asked to approve the Traffic Congestion Relief and Spending Limitation Act of 1990, a comprehensive plan to relieve traffic congestion on our highways, upgrade our urban and rural road systems and expand mass transit.

This plan is absolutely essential to the economic future of our state and our quality of life. If you want to spend less time stuck in traffic; if you want cleaner air; and if you want to ensure that California's economy will remain strong so that your children will have job opportunities, then I suggest it is worth paying a few more pennies a day. I'm strongly urging all Californians to join me and a bipartisan majority in the Legislature in giving this landmark proposal their enthusiastic support.

Just as the next exit on the freeway is becoming harder to reach, so is the dream of home ownership. I am proposing that the Legislature join me in enacting a five-year, $2 billion Housing Opportunity Program to greatly expand our efforts to put home ownership back within reach of the average family.

Using its existing bonding authority, the California Housing Finance Agency will raise $1.8 billion of these funds through the issuance of both revenue and private activity bonds. Another $200 million can be generated through a reauthorization of unutilized general obligation bonds already approved by the voters when they passed the First Time Homebuyers Bond Act of 1982.

Together, these funds will be dedicated to providing down payment assistance and reduced interest rate mortgages for thousands of first-time homebuyers.

With home ownership in California becoming more difficult, let us take these important steps now to prevent the American dream from becoming the impossible dream.

The dawn of a new decade should bring with it completion of our work on another milestone or humanity – basic health care coverage for all working Californians and their families.

An estimated four million working Californians and dependents have no coverage and securing private is too expensive for most of these families.

Pursuant to legislation I signed last year a task force established by our administration will make recommendations shortly so that we can develop a plan that is both fair to small businesses and which addresses the health care needs of the uninsured.

And while we're talking about insurance, let me also address the subject of car insurance. When I vetoed Assembly Bill 2315 last year, I told the bill's author, Speaker Willie Brown, that I would work with him to develop a practical and affordable basic policy for motorists who are now unable to secure or afford even minimal coverage. Our staffs have begun discussions which I hope will lead to some positive steps this year to increase the affordability of automobile insurance in California.

California's response to the terrifying earthquake of October 17, 1989 was outstanding. The earthquake registered high on the Richter scale, but our people registered even higher on the courage scale.

Yet, we should learn from this experience and take additional steps now to prepare for future disasters.

I am proposing $11 million in additional expenditures to fund new disaster readiness measures including, planning a site for a Southern California Operations Center of the Office of Emergency Services; statewide inspection of public schools and state buildings; and the purchase of additional rescue and communications equipment.

I am also proposing an additional $350 million in bonds to retrofit state buildings and higher education facilities.

In addition, I am proposing that $15 million from the proceeds of the sale of some surplus property at Agnews State Hospital in San Jose be directed toward providing permanent housing for low income residents displaced from their homes by the October 17 earthquake.

Also, I will propose a method to assist earthquake-affected communities which sustained major losses of tax revenue.

Finally, let's understand that there are going to be more serious earthquakes in California, and there's no way to duck that reality. No earthquake rebuilding effort will be complete or responsible, until we make earthquake insurance coverage a mandatory feature of all policies written for at-risk privately owned building. I am asking the insurance industry, the business community and the Legislature to work with me to develop a practical plan to achieve this goal this year.

We can't talk about the challenges of the 1990s without speaking of California's children. During the past seven years, we have accomplished some needed reforms in our public schools, and more than doubled their funding. And we have indeed restored pride and excellence to our public institutions of higher learning.

My message to the young people is that the benefits of staying in school will pay off every day, for the rest of your life. I urge you to remain with your education, and then your education will remain with you.

In 1986, I proposed, and we implemented, a Children's Initiative designed to improve health care, day care and child support collections on behalf of the young, and to better protect them from abuse.

And yet, all our efforts will be squandered if we continue to allow the destruction of our young people by poisonous drugs.

My new budget contains an additional $10 million to expand a life-saving effort we began last year – drug education in our schools. With two year expenditures totaling $54 million, we will now be able to include drug education in every school from grades four to eight.

We must also take additional steps to stem the flow of illegal drugs into our state. I am pleased to report that the federal government has approved the allocation of $10 million to the California National Guard to step up its work with local law enforcement agencies to stop the smuggling of drugs across our border.

Recently, some have suggested legalization as a solution to the drug problem. They are dead wrong. We must never, never wave the white flag of surrender at the while plague of cocaine, and other drugs.

Currently, our school age population is growing at a rate of forty percent faster than our population as a whole. With that kind of growth, we can't depend simply on building our way out of the shortage of classrooms, even though we have completed nearly 700 school construction projects since 1982. My new budget contains an additional $1.6 billion bond proposal for school construction, but it will be accompanied by these additional proposals:

First, we will provide strong financial incentives to districts which adopt a year-round school program, including special per student payments and first-call on school construction bond funds. It is simply inexcusable and wasteful to allow school facilities to sit idle and unused for up to three months per year.

Second, in order to encourage local districts who move toward year-round schools to enact their own local school bond measures, I would support a constitutional amendment to reduce to 60 percent the two thirds vote that is now required for approval of those bonds.

Californians are justly concerned about preserving the natural beauty and health of our environment and protecting it from air, water and toxic pollution. We have enacted the toughest laws in the nation, and we acquired and preserved thousands of acres of sensitive lands. Yet regrettably, our state is getting dirtier by the day – not from those types of pollution – but from the garbage thrown on our streets and the graffiti plastered on our walls. It is time for California to clean up its act.

I am proposing that we double the amount of litter cleanup work performed by CalTrans on our state's major urban freeways. We will also encourage neighborhoods, civic organizations and youth groups to ‘Adopt a Highway,' and take the responsibility for keeping it clean. Also, I am instructing the California Highway Patrol to redouble its efforts to catch litterbugs in the act, pull them over, and fine them.

I want Californians to be able to take pride in their communities and their state once again. We must persuade, educate and insist that all residents respect our roads, freeways, walls, beaches, parks and neighborhoods – and stop using them as their own personal garbage dump.

Finally, let me say a few words about the new budget.

The budget I am proposing is a balanced budget that contains a prudent reserve and no general tax increases.

It is $3.4 billion more than the current year budget I signed last July, and a little more than 100% bigger than my first budget in 1983.

The Department of Finance is projecting an 8.4% growth in general fund revenues in the coming year. Yet, under existing laws – including entitlement programs, annual cost of living increases, caseload requirements, and constitutionally required prudent reserve – the general fund budget would expand by more than 11%.

Ladies and gentlemen, we must face reality. When you have laws requiring spending increases of 11 percent and additional income of 8.4 percent, it is evident that adjustments in some programs will be needed to bring the projected rise in spending in line with projected rise in income.

Any government which is programmed on auto-pilot to build its base budget by 11 percent a year, not including any new programs, is headed for trouble. The economy can't grow fast enough, nor would the public stand for an annual automatic tax increase, to sustain such an exorbitant level of government growth.

And so, I will propose a number of reasonable and necessary legislative changes in some programs. But let me emphasize that this is my January budget proposal, which is based on the best information we can get at this time. Just as I did last year, I am prepared to sit down with the legislative leadership for as long as it takes in the coming months to achieve a consensus budget.

My fellow Californians, as we begin the 1990s, we should be thankful that our state is stronger and more prosperous than it has ever been. Through common sense and cooperation, we have achieved fiscal responsibility. We have restored economic excellence – but now we must preserve it, protect it, build upon it and make sure that it is equally shared.

The initiatives I have put forward today represent an ambitious but compelling agenda for a state which in the 1990s, will see its 29 million population grow by another five million residents, and where ethnic minority communities combined, will constitute the majority. And please understand I haven't chosen these policies with my eyes fixed on the future of the governor. I've chosen them with my eyes fixed in the future of California.

Like so many others, I became Californian not by birth but by choice. I adopted a state whose opportunities are as boundless as its beauty, whose future is as bright as it sunshine, and whose possibilities are as varied as its people. I want to preserve that kind of California for all of California's children and grandchildren.v

As I enter my 28th and final year of public life, I am grateful for the opportunity the people have given me to serve them, beginning only seven years after my arrival in this state, with my first oath of office as an Assemblyman in the this chamber – and ending as the leader of a state that is the leader of America.

As most of you know, Gloria and I are first generation Americans. Our parents struggled and worked very hard to give their children a better start in life than they had known.

We have tried to do the same for our children, and as Governor, my goal was to leave California better than I found it. I believe that it is better than it was, and that is why literally millions of people have come here in the past few years seeking unlimited opportunities.

Together, we have done well, but I know we can do better. Despite some of our differences, we are bonded by our desire to pass along to the next generation the golden opportunities of the golden state. There is still much to accomplish in the first year of the last decade of the 20th century, so let's carry on in a spirit of unity and good will.

Thank you very much.