This analysis of the California Governor's proposed 1990-91 budget for the State contains: (1) a discussion of the major budget issues facing the Governor and the Legislature in constructing the 1990-91 State budget; (2) a brief overview of the Governor's proposed funding priorities; and (3) a summary of the proposed budgets for grades K-12, the three public postsecondary education segments, and the State's higher education agencies. It also includes the findings and the recommendations of the Legislative Analyst's report on the 1990-91 Budget Bill and an analysis of the postsecondary education proposals for capital outlay projects for the 1990-91 fiscal year. Some of the key fiscal and policy issues affecting postsecondary education are identified; they include: (1) future enrollment growth in higher education; (2) full funding of the base budgets and enrollment growth in California's public colleges and universities; (3) level of faculty, staff, and administration's compensation; (4) expanding student financial assistance; and (5) funding the needs of adult education. Contains 8 references. (GLR)