By Dan Smith - smith@sacbee.com
September 11, 2008 - Lawmakers are debating three main plans to resolve the state's overdue budget - one proposed by Gov. Arnold Schwarzenegger in August, one advanced by Democrats from two-house conference committee deliberations, and one from legislative Republicans. So far, none of them has received enough support to reach the needed two-thirds vote for passage. Here's a look at how they differ in key areas.
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TAXES/REVENUES
SCHWARZENEGGER
• Raise sales tax by one cent on the dollar for three years (except on gasoline and diesel); cut sales tax by 1.25 cents on the dollar on Sept. 1, 2011. $4 billion in first year
• Suspend net operating loss deductions for tax years 2008 and 2009; make other changes for businesses to recoup the money in future years. $1.1 billion in first year
REPUBLICANS
• Suspend net operating loss deductions for tax years 2008 and 2009; make other changes for businesses to recoup the money in future years. $1.1 billion in first year
• Borrow from future lottery funds. $1.9 billion
DEMOCRATS
• Create higher tax brackets for high-income taxpayers. $5.6 billion
• Raise corporate income tax rate from 8.84 percent to 9.3 percent. $470 million
• Eliminate indexing of income tax brackets. $815 million
• Eliminate child dependent credit for high-income taxpayers. $215 million
• Suspend net operating loss deductions indefinitely. $1.1 billion in first year
SHIFTS/TRANSFERS
• All three plans propose to accrue income tax payments from the next fiscal year. $1.9 billion
SCHWARZENEGGER
• Shift transportation money from special fund to pay for transportation programs in general fund. $1.7 billion in savings
• Transfer from special state funds. $648 million
• Shift 5 percent of local redevelopment funds to schools and community colleges. $344 million
• Grant income tax amnesty. $360 million
REPUBLICANS
• Shift transportation money from special fund to pay for transportation programs in general fund. $1.7 billion
• Borrow from special state funds. $648 million
• Shift 5 percent of local redevelopment funds to schools and community colleges and redirect funds set aside for low-income housing. $694 million
• Grant income tax amnesty. $360 million
DEMOCRATS
• Shift transportation money from special fund to pay for transportation programs in general fund. $1.1 billion in savings
• Borrow from special state funds. $498 million
• Shift local redevelopment funds to schools and community colleges. $98 million
• Grant income tax amnesty. $1.5 billion
K-12 EDUCATION
SCHWARZENEGGER
• Provide $57.8 billion for schools. No cost-of-living increase is included.
REPUBLICANS
• Provide $57.9 billion for schools, but $1.9 billion is dependent on lottery borrowing plan and would not be built into base for calculating future education funding under Proposition 98. No cost-of-living increase is included.
DEMOCRATS
• Provide $58.9 billion for schools, which includes a 2.1 percent cost-of-living increase.
HEALTH/WELFARE
• All three plans suspend cost-of-living increases for low-income elderly, blind and disabled on SSI/SSP ($264 million in savings) and for welfare families ($162 million in savings).
SCHWARZENEGGER
• Cut Medi-Cal provider rates. $500 million in savings
• Deny federal cost-of-living increase for low-income elderly, blind and disabled on SSI. $172 million in savings
REPUBLICANS
• Cut Medi-Cal provider rates. $392 million in savings
• Cut Medi-Cal services for illegal immigrants and legal immigrants in the country less than five years. $87 million in savings
• Require undocumented immigrants to file monthly for Medi-Cal eligibility. $42 million in savings
• Cut welfare grants to 1989 levels; make other CalWORKS changes. $548 million in savings
• Cut pay for in-home supportive services workers to minimum wage, other reductions to program. $265 million in savings
• Eliminate program for elderly, blind and disabled legal immigrants no longer eligible for SSI. $111 million in savings
• Cut payments to counties for Child Welfare Services. $84 million in savings
DEMOCRATS
• Cut Medi-Cal provider rates. $302 million
PRISONS
• All three plans deny pay raises for correctional officers. $521 million in savings
SCHWARZENEGGER
• Make sentencing changes that increase monetary thresholds for property crimes and change petty theft with a prior conviction to a misdemeanor; other inmate credit and parole changes. $175 million in savings
• Reduce local assistance to various programs by about 10 percent. $54 million in savings
REPUBLICANS
• Make inmate credit changes. $35 million
• Reduce local assistance, including grants for Mentally Ill Offender Crime Reduction program. $94 million in savings
DEMOCRATS
• Eliminate parole for inmates who have completed sentences for "non-serious, non-violent offenses and have no prior serious or violent offenses or sex offenses." $110 million in savings
• Revamp prisoner credit program, resulting in shorter time served. $140 million in savings
• Make sentencing changes that increase monetary thresholds for property crimes and change petty theft with a prior conviction to a misdemeanor. $100 million in savings
• Make other parole changes. $95 million
• Reduce local assistance, including grants for Mentally Ill Offender Crime Reduction program. $157 million in savings
LONG-TERM BUDGET CHANGES
SCHWARZENEGGER
• Create rainy day fund, fed by borrowing against future lottery earnings, that is designed to save money in good economic years for use in bad years. Allow governor authority to make midyear budget cuts in bad years.
REPUBLICANS
• Allow governor authority to make midyear budget cuts in bad years.
• Set hard spending limits for general fund and special funds based on inflation and population growth.
DEMOCRATS
• Support rainy day fund.
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