Capitol Alert

California Chamber of Commerce CEO Allan Zaremberg said he still believes there's time for a "comprehensive" solution to the state budget in the wake of Gov. Jerry Brown's veto.

Labor unions have become less than enthusiastic about the idea of a fall election on taxes and long-term changes to pensions and spending, recognizing the uphill battle they would face with voters. David Kieffer, head of Service Employees International Union California State Council, said his group would have to think twice about funding a tax campaign.

But Zaremberg suggested that if lawmakers and the governor strike the right deal, some of his members would be willing to finance the effort.

"I think I have some members who would like to see a comprehensive solution so they're not in the crosshairs for targeted taxes," Zaremberg said. "And I can see the business community saying for the good of the community, let's get this behind us once and for all. We're tired of watching Fox News get their entertainment from bashing California."

After vetoing Democrats' majority-vote budget, Brown said last week he would "move heaven and earth" to find the necessary four Republican votes to strike a bipartisan deal on taxes and long-term changes.

Major businesses are concerned that lawmakers or unions would push for targeted taxes on oil and other industries should Brown's package of general tax extensions fail. As part of budget talks, Republicans are also pushing for relaxed environmental requirements and required analysis of new laws and regulations for economic impacts, changes that would help businesses.

Zaremberg thinks winning a fall campaign is "doable, but we have to have the right mix of provisions to create a formula the public can trust. What we learned in 2009 was, though there were a lot of problems like borrowing from the lottery, the mere fact that the Legislature puts it on the ballot creates some skepticism from voters. So that's one of the things we have to overcome."

Brown said last week that if he were able to strike a deal for a fall election, he expected support from a variety of groups. Some thought he was hinting at business support, in addition to traditional Democratic allies like labor unions.

"I think if these are tax extensions, we have a very good chance to win," Brown said. "And I'm looking for a very broad coalition that doesn't derive its source of financial support from one organization, but a multitude of California organizations that care about our future. And that's the way the initiative will be funded."