Sunday, August 17, 2008

A State Without a Budget - Day 48 - NO END IN SIGHT FOR BUDGET BATTLE


By Steven Harmon | Contra Costa Times Sacramento Bureau


Subday, August 17, 2008 - SACRAMENTO — A vote will be held today on the state budget, but East Bay lawmakers don't expect the standoff — now in its 48th day — to end any time soon.

Heading into today's 3 p.m. Assembly session, a wide chasm still divides Democrats and Republicans on the major sticking points in negotiating a budget that must pare down an estimated $15.2 billion deficit.

"I think it's a 50-50 chance this could go into September," said Assemblyman Sandre Swanson, D-Oakland, "because some of us are not willing to balance the budget on the backs of children, and Republicans have not abandoned their cuts-only approach."

Assemblywoman Loni Hancock, D-Berkeley, accused Republicans of pursuing a goal of "starving" government and of being "intransigent" in holding out for more spending cuts while avoiding any tax increases.

"It all depends on what Republicans are going to do — whether they're willing to compromise at all," she said, "or if they're bound by their Grover Norquist pledge to demand a cuts-only budget."

Assemblyman Guy Houston, R-San Ramon, was equally doubtful that Democrats will concede on their demands to raise taxes on the wealthy — those making $320,000 or more — as a way to protect state services.

"There are zero votes for this budget," said Houston, the only Bay Area Republican. "The issues haven't changed and there's not one iota of the two sides deviating from their positions. The


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purpose of (today's) session is to show Republicans are not cooperating."

Republicans, who are in the minority but hold the key votes in a system that requires a two-thirds majority in both legislative chambers to approve a budget, have remained steadfastly opposed to increasing taxes. They also insist that a budget agreement must include a constitutional amendment to require a spending cap in future budgets.

Democrats insist that the deficit can't be made up through program cuts alone, though they say they're offering more spending cuts and fewer taxes in today's budget plan. Their initial budget called for $10 billion in taxes, largely on the wealthy.

Secretary of State Debra Bowen extended the deadline from Friday to Monday for lawmakers to produce measures intended for the ballot. But unless there's a broader agreement on the budget, it is a long shot lawmakers will agree on reform measures.

Assembly Democrats rejected a GOP budget reform measure, ACA19, at a committee hearing Friday, another signal that the two sides remain at loggerheads in negotiations.

Assemblyman Mark DeSaulnier, D-Concord, said he's ready to reach across the aisle on the budget and on ballot measures that have been stumbling blocks in negotiations.

"It's time for reasonable people to come up with a compromise and produce a budget," DeSaulnier said. But both sides, he said, need to "soften their ideological" positions on budget reform, and possibly a $9.3 billion water bond that Republicans are pushing to get on the November ballot.

Democrats have already moved more than half way, said Assemblywoman Mary Hayashi, D-Castro Valley, offering to institute a rainy-day fund that salts revenues away from good economic years to be used for down years.

"A rainy-day fund is a huge win for Republicans," she said. "That's what they say they want. We're willing to work with them to figure out how we could get the votes to get it done. I'm hopeful something could get done (today), but I'm prepared to continue negotiations with them until we have a budget that makes sense for all Californians. But we're not going to accept their cuts-only approach."

Hancock said she's "very reluctant" to support more spending cuts and fewer taxes, but said she would do it "because of the urgency of the situation. But we're dealing with a very intransigent and irresponsible minority. We can't go any further than this. Any additional cuts would decimate education, transportation, environmental protection."

She said she'd be willing to hold out through the fall elections so that Democrats could see if they could get closer to a two-thirds vote after the election.

Houston said he has offered a continuous appropriations bill to allow state services to run uninterrupted during the budget stalemate. Democrats' opposition to it, he said, shows they are willing to stall long enough that people start feeling the pain of the budget standoff.

"They feel if they make it really bad, Republicans will have to cave," he said. "But our caucus is unified. The only frustration is we didn't do this (have a vote on the budget) six weeks ago, because that's usually the point where everybody starts rolling up their sleeves and negotiating."

Hayashi said she hopes the public has patience while lawmakers sort out their priorities.

"We want people to understand that we're not holding out for the sake of holding out," she said. "We're trying to protect seniors, education and all the things Democrats care about."

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