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Legislative Republicans rolled out a budget plan Thursday that relies on cutting state worker pay, eliminating affordable housing funds and using pots of money dedicated for mental health and childhood development.

Republicans believe their plan eliminates the state's $9.2 billion deficit without new taxes and preserves the same amount of funding for education that existed last year. They say it undercuts Gov. Jerry Brown's argument that voters must pass higher taxes in November to spare schools from deep reductions.

"The state budget is a reflection of priorities and there is no reason to hold our schools hostage to the uncertainties of the proposed tax increase initiative that may not benefit our students," GOP legislative and budget leaders wrote in a joint letter. "With political will, we can work together in a bipartisan manner to ensure that our schools are protected from trigger cuts, whether the Governor's tax initiative is ultimately accepted or rejected by the voters."

Democrats have all but written off Republicans in this year's budget process because they have majority-vote budget authority and are going directly to voters for a tax hike on sales and upper-income earners. Brown has said that if voters reject the tax hike, the state will need to cut about $2.4 billion in K-14 classroom funds, equal to three weeks of school, as well as cut $200 million each from the state's university systems.

Republicans argue that it remains possible to balance the state budget without new taxes as the economy recovers and revenues grow. Many of their proposals are similar to those that Democrats relied upon in the past or have been suggested by the nonpartisan Legislative Analyst's Office.

But they include borrowing and one-time patches that Brown says he wants to stop with his November tax hike. The proposal would also require school districts to continue borrowing about $10 billion annually rather than begin paying down that amount as Brown wants.

The Republican Plan

To erase the deficit, Republicans are building off of Brown's non-tax ideas. Those include $4.2 billion in spending cuts, such as slashing welfare-to-work by $1 billion, and $1.4 billion in accounting maneuvers and delayed debt repayment. Democrats have already indicated they do not support all of Brown's cuts.

Brown also relies on $4.4 billion in new revenues from his November tax initiative. (Brown's original initiative raised $6.9 billion, while his new one generates $9 billion. But not all of this money reduces the deficit because schools take a share of any new state dollars.)

The Republican budget has $4.4 billion in replacement ideas that include:

- $400 million by reducing state worker pay by 4.6 percent, equal to one monthly furlough day. Republicans say the state could save this money by cutting pay, furloughing workers or reducing operating expenses.

- $1 billion by eliminating local funds for affordable housing that once came from redevelopment accounts that are expiring. Democrats want to preserve this money for affordable housing, and the Assembly has sent a bill to the Senate to do so.

- $1.3 billion by taking money from Proposition 63's tax on millionaires for mental health services.

- $226 million by using tobacco tax funds, most of which go toward First 5 early childhood development.

- $158 million by cutting hours and wages for In-Home Supportive Services workers.

- $316 million by delaying repayment of borrowing from special funds.

- $220 million by assuming Brown wins more lawsuits over past budget cuts than he predicts.

- $100 million from turning freeway message boards into billboard space.

- $200 million from PG&E as a fine for the 2010 San Bruno gas explosion.

- $170 million from Senior Care Action Network, a managed care organization, as a refund for past overpayments.

- $254 million from other cuts, such as eliminating state funding for the California Science Center in Los Angeles, cutting pharmaceutical costs for inmates and delaying implementation of the state's unified FI$Cal financial system.

If all were adopted, the plan would leave the state with a $1 billion reserve similar to what Brown proposed, Republicans said.

In their letter, GOP leaders suggested that Brown and Democrats should adopt these alternate proposals to give school districts assurance that they will not have to cut next school year. Districts issued nearly 20,000 teacher layoff notices as of the March 15 deadline, according to the California Teachers Association, in anticipation that Brown's worst-case scenario may occur.

Republicans also called for a November ballot measure that caps future spending, as well as Brown's pension proposal.


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