‘Use it or lose it’ budget practice common in California government

From The Sacramento Bee:

State workers call it “use it or lose it,” a practice in which departments try to spend every last penny rather than save for the good of the overall California budget.

It is a “perverse” dynamic of government spending, the state’s Little Hoover Commission observed more than a decade ago. Department directors fear that Capitol budget writers see leftover funds as proof that too much money was authorized in the first place, possibly resulting in future cuts.

To avoid that outcome, departments spend on anything from extra paper clips to new computers before the fiscal year ends each June.

“It’s clearly part of the culture and part of the tension that exists between the Department of Finance and agencies,” said James P. Mayer, who serves as executive director of California Forward and previously examined the issue with the Little Hoover Commission.

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