With state finances improving, it's time to pay down debts while there's money available.

In early January, Gov. Jerry Brown will present his budget proposal for fiscal year 2016-17. In anticipation, Legislative Analyst Mac Taylor last month reported that the state is better prepared for an economic downturn than at any point in decades.

Taylor forecasts that, if the economy stays strong, the state's rainy day fund will grow from $5.6 billion this year to $11.2 billion in 2019-20. The governor wisely championed this emergency fund and convinced voters in 2014 to require it.

In addition, discretionary reserves that lawmakers can tap will increase from $2 billion this year to $17 billion in 2019-20. That strong forecast takes into account the phase-out, starting next year, of the temporary sales and income tax hikes voters approved in 2012.

In other words, the fiscal crisis that precipitated Brown's plea for tax increases is over. The push by some politicians and labor groups for a voter extension next year is misguided.

That said, while the crisis has passed, a huge debt hangover remains. This is not the time to add lots of new programs that will make it harder to balance the budget during the next economic downturn. Yes, there will be another downturn.

As the governor's finance director, Michael Cohen, warned, "we must continue to pursue fiscal discipline, pay down liabilities, and build up our Rainy Day Fund during these fleeting good times."

About those liabilities he mentioned: The state currently owes more than $210 billion for unfunded pension and retiree health care obligations for state workers, school teachers and University of California employees.

That's how much the investment funds are currently short. Over the past four years, the governor developed plans for addressing the imbalances. But the repayments are stretched out, in most cases, for three decades.

That's too long and the governor knows it. For example, last month, he sharply criticized the California Public Employees Retirement System for using what he correctly termed "irresponsible" investment assumptions that tamp down payments.

If CalPERS had acted responsibly, the state would have been required to make higher minimum contributions. However, the pension system's failure doesn't preclude the governor and Legislature from doing the smart thing by paying more now.

Just like a credit card bill, larger payments now, when money is available, will reduce future payments when times are tight. They guard against severe future budget cuts.

The same principle applies to all the retirement debts. As the governor prepares his budget, he should insist that the state more aggressively pay them down.

Brown restored the state's fiscal stability. Now he should protect it.

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