As we head toward decision time for the budget trigger to be pulled and to what degree, fiscal information is starting to come in from the keepers of the ledgers. State Controller John Chiang revealed last week that while November tax receipts were a half-billion dollars ahead of projections, California was spending almost two-billion dollars more than projected.

The state budget will never be brought into balance until we control spending.

Where California is overspending is a bit of a mystery. The Controller’s Statement of General Fund Cash Receipts and Disbursements shows that practically all the overspending is in the category of Local Assistance. In fact, State Operations is doing quite nicely in the spending department, currently running almost one-quarter of a billion dollars under budget spending projections. However, that savings is easily wiped out by the Local Assistance spending.

While the Controller’s report indicates some of the areas in which overspending is occurring under Local Assistance, the biggest chunk of overspending is an unidentified category labeled “Other Local Assistance.”

The report is clear, for example, that Mental Health programs are overspending by 185% or about $166-million and that the Community Colleges are overspending by 26% or around $527-million. But, the Other Local Assistance category accounts for $1.44 billion of overspending.

Could it have anything to do with the governor’s realignment program sending state prisoners to local jails?

What is clear is that spending continues to be California budget’s Achilles heel. The fix for the state’s spending problem is a solid spending limit. As I wrote last week, voters will likely get a chance to support such a fix when a proposed spending limit appears on next November’s ballot. (Disclosure: I am involved in supporting the proposal.)

One other important note in the Controller’s report is that the budget is balanced on borrowing. The Controller states that both internal borrowing from special funds and external borrowing, which adds to the state’s debt, cover the current deficit. The spending limit initiative proposal aims to not only prevent future borrowing by controlling spending, but also proposes to pay down the state’s current debt when revenues exceed the spending limit.

It seems from the Controller’s latest numbers the spending limit proposal is important and timely.