June 27 (Bloomberg) -- California Governor Jerry Brown said he dropped his plan to extend expiring taxes to close a $10 billion budget deficit and will back a new proposal based on $4 billion in higher-than-forecast revenue and additional spending cuts.
The agreement requires only a simple majority to pass the Democratic-controlled Legislature, meaning Brown doesn’t need Republican cooperation to adopt the spending plan for the year beginning July 1.
Brown, a 73-year-old Democrat, took office in January on a pledge to fix the fiscal malfunctions that have left California with the lowest credit rating of any state from Standard & Poor’s. The governor spoke in a news conference in Sacramento.
The Golden State, which accounts for 13 percent of the U.S. gross domestic product, began the year with a $26 billion deficit. Since then, spending cuts approved in March and better- than-projected tax revenue shrank the gap to $10 billion.
--Editors: Pete Young, Mark Tannenbaum
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