71 days w/o a budget: SENATE DEMOCRATS REJECT GOP PROPOSAL FOR ENDING CALIFORNIA BUDGET IMPASSE - Republican plan would have avoided a sales tax increase through $3.4 billion worth of spending cuts.

By Jordan Rau, Los Angeles Times Staff Writer

September 9, 2008  -- SACRAMENTO -- Senate Democrats rejected the Republicans' proposal for ending California's budget deadlock Monday, saying the state would not tolerate $3.4-billion worth of spending cuts they proposed.

The GOP plan failed along party lines, 13 to 21, nine days after the GOP had blocked a Democratic alternative because it increased sales taxes to close a $15.2-billion budget gap.

Though Sen. Bob Dutton (R-Rancho Cucamonga) said he hoped the GOP budget would "act as a starting point" for a reconciliation, more than an hour of debate produced no political movement.

"The Democrats have compromised as far as we can," said Sen. Dean Florez (D-Shafter). "This is a budget quite frankly worthy of dismissal."

The Republican plan would have avoided sales tax increases, originally proposed by Gov. Arnold Schwarzenegger, through cuts in welfare grants, child-care programs, college financial aid, the salaries of in-home care workers who tend to the elderly and disabled, and dozens of small programs. The plan also would have accelerated borrowing against the lottery beyond what Schwarzenegger and Democrats have proposed to infuse the state treasury with nearly $2 billion in cash for the fiscal year that began July 1.

"As a caucus, we believe tax increases are the absolutely wrong way to go," said Senate GOP leader Dave Cogdill (R-Modesto).

Behind-the-scenes negotiations are not going any better. A private meeting between Schwarzenegger and Senate Republicans on Thursday did not lead to any breakthroughs, and there are similar expectations for his scheduled meeting today with Assembly Republicans.

Schwarzenegger said: "Now that the Senate has voted down both the budget proposal put up by Democrats and the proposal put up by Republicans, I'm asking that senators take up my compromise budget, which is a fair, responsible, middle-of-the-road proposal, and pass it."

Democratic Assembly leaders are considering bringing it up for a vote in their chamber as early as today to demonstrate that it has insufficient support in both parties.

Under California's rule that fiscal measures need a two-thirds vote of each chamber, the Legislature needs at least eight Republicans -- two in the Senate and six in the Assembly -- to pass a budget. Near the end of Monday's debate, Senate President Pro Tem Don Perata (D-Oakland) loudly berated the Republicans, saying that a few have privately outlined to Schwarzenegger the terms under which they would defect from their caucus, but that those demands keep changing.

"Why don't you stand up and tell me what you need!" Perata yelled. "I'm done guessing."

But Cogdill said, "If there's a Republican willing to raise taxes, they haven't talked to me."