Capitol Alert

The latest on California politics and government

February 12, 2009
AM Alert: What's the dealio?

SteinbergPressClub.jpgLegislative leaders and Gov. Arnold Schwarzenegger did not release details of the tentative budget pact they've struck, though that didn't stop details from leaking out.

The 30,000-foot view: $15.8 billion in cuts, $14.3 billion in tax increases, $10.9 billion in borrowing. And if California gets $10 billion in federal stimulus money, cuts drop by $1.2 billion, borrowing by $5.5 billion and tax increases by $1.8 billion.

Delving deeper, the plan: Gives K-12 education $5 billion less than it was otherwise entitled to.

Eliminates two paid holidays for state workers, with the final number of furlough days per month through June 2010 still subject to negotiation.

Cuts UC and CSU by 10 percent.

Eliminates cost-of-living increases for recipients of CAL-Works and SSI-SSP.

Cuts the corrections department's medical budget by 10 percent.

Eliminates funding for local public transit agencies.

On the tax side, the plan increases sales tax by 1 cent on the dollar, vehicle license fees from current 0.65 percent of vehicle value to 1.15 percent, and gasoline taxes by 12 cents a gallon with proceeds to pay off transportation bonds. Income taxpayers would pay a 2.5 percent surcharge on tax liability - 5 percent if federal stimulus comes in under $10 billion. Reduces tax credit for dependents from $309 to $99.

Taxes would be increased for two years, and an additional one to three years if the spending restriction measure is approved on the ballot.

Other new "revenues" include taking from voter-approved taxes for mental health and early childhood programs.

The whole thing would have to go before voters in a whopping five-measure package: borrowing from the lottery, changing Proposition 98, approving the spending cap, and taking funds from Proposition 10 (tobacco tax for early childhood programs) and Proposition 63 (tax on millionaires for mental-health programs).

That, of course, is if the whole thing passes the Legislature in a vote now scheduled for Friday.

"I'm not guaranteeing any votes," Senate GOP leader Dave Cogdill said Wednesday.

"I felt it was as good as I could get and I was willing to release my members," he said. "It's up to them (his members) to make that decision."

So far GOP Sens. Dennis Hollingsworth, Sam Aanestad, and Abel Maldonado have all publicly said 'no deal.'

Then there's the case of moderate Democratic Sen. Lou Correa.

"I just don't think it gets out if he doesn't go up on it," Cogdill said

Steve Wiegand's January profile of new Assembly members walking a political tightrope is worth a re-read. (On the Democrats-only budget passed in December, none of the four freshman Dems to win in previously GOP-held seats voted. They all abstained. Schwarzenegger eventually vetoed the proposal.)

"A deal is never a deal around here," Republican Sen. Bob Huff warned Wednesday, "until it's in writing, and you're voting on it."

Which could be as early as tomorrow...

GOVERNOR 2010: Attorney General Jerry Brown chatted up about gubernatorial thoughts on Wednesday. "In my spare time, late at night, I do a little plotting," he said.

When might, say, an announcement come? Could be a while, as he suggested he may wait until there's snowfall on the Sierra next winter before officially deciding to enter the race...

Tune in to the Today show this morning to watch Meg Whitman take some slow-pitch political softball after giving her first interview as a candidate earlier this week.

San Francisco Mayor Gavin Newsom will be in Stockton (the country's "most miserable city") for another town hall.

Senate President Pro Tem Darrell Steinberg, D-Sacramento, gestures while speaking before the Sacramento Press Club on Wednesday, Feb. 11, 2009. Credit: AP Photo/ Rich Pedroncelli


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