The proposed 2010-11 state budget closes an anticipated $20 billion funding gap as total State General Fund spending is expected to decline for the fourth consecutive year. The budget essentially maintains higher education and K-12 funding at 2009-10 levels, but proposes some policy changes to K-12 that will result in the loss of significant anticipated revenues in this and future years. The budget proposes using available resources to cover most basic services and contains major reductions and policy changes. This budget highlights the state's dilemma of trying to stabilize funding, amid growing resource commitments, with unstable tax revenues. Aligning resources with expenses at local and state levels would allow agencies to develop the long-term operations plans they need in order to provide public services efficiently. This stability is particularly important in education, where short-term budget balancing actions may have negative long-term consequences.