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Daniel Weintraub

California Insider

A Weblog by
Sacramento Bee Columnist Daniel Weintraub

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« December 2003 | | February 2004 »
January 30, 2004

Governor denies clemency

In his first review of the fate of a condemned prisoner, Gov. Arnold Schwarzenegger has denied clemency to convicted murderer Kevin Cooper. Here is a copy of the press release and decision.

Posted by dweintraub at 3:17 PM



January 29, 2004

Mindy Tucker Fletcher joins Ogilvy in Sacramento

Mindy Tucker Fletcher, a communications adviser to President Bush since his time as governor of Texas, is joining Ogilvy Public Relations Worldwide as senior vice president in the public affairs practice of the agency’s Sacramento office. Fletcher will be paired with Maggie Shandera Linden, a senior adviser to Assembly Speaker Herb Wesson. Tucker Fletcher has been an adviser to the California Republican Party and to the Bush-Cheney '04 reelection campaign. She is the former communications director for the Republican National Committee and press secretary for the Bush 2000 campaign. She was director of public affairs for the Justice Department at the time of the Sept. 11, 2001 terrorist attacks.

Posted by dweintraub at 4:38 PM



Arnold reshapes state school board

Schwarzenegger took control of the state Board of Education today, appointing or re-appointing seven members to the 11-member board, including his longtime friend and senior adviser in the governor’s office, Bonnie Reiss. He also reappointed Reed Hastings, a charter school advocate and appointee of former Gov. Gray Davis. The other five appointees, all new, were Los Angeles jewelry designer and arts advocate Ruth Bloom, Santa Barbara school board member Ruth Green, former Pete Wilson education adviser Glee Johnson, Lake Elsinore school board member Jeannine Martineau and charter school founder Johnathan Williams. I’m not familiar with all of them, but based on their bios and what I do know about them, they look like a solid group of appointees who can probably be expected to maintain the momentum built by the past two governors for a strong system of statewide standards, assessment and accountability. The appointment of Reiss to the board is an interesting wrinkle, indicating that Schwarzenegger wants to keep a close eye on the board’s activities. The seven members include four Democrats, two Republicans and one decline-to-state.

Posted by dweintraub at 4:19 PM



"Fantastic!" or fantasy?

Gov. Schwarzenegger's claim the other day that he intended all along to repay campaign loans with his own money, rather than raising it from interest groups, was hard to believe. Now the lawyer who sued Schwarzenegger for violating campaign finance laws says the governor is simply lying, and he insists there are bank documents sealed in the case that would prove it. Here is the story in the Bee. More broadly, the governor's statement -- describing a court ruling against him as "fantastic" news -- fits an increasingly disturbing pattern of Schwarzenegger trying desperately to put a good spin on everything that happens on his watch. With each step down that road, his credibility drops another notch. It's one thing to be relentlessly optimistic. It's another to deny reality. At some point it would be nice to hear him admit defeat on something, and simply say, "You win some, you lose some. I lost this one."

Posted by dweintraub at 8:44 AM



Why we need an exit exam

Despite recent reforms, California's high schools are still churning out college-bound graduates who can barely read, write and do math. According to the California State University system, nearly half the freshmen who began college at the system's 23 campuses last fall needed remedial courses in English. And nearly 40 percent needed extra help in math to bring them up to the standard the university expects from entering students. Here is a story from the Bee.

Posted by dweintraub at 8:34 AM



January 28, 2004

Study: Wal-Mart savings would mean job growth

A new study by the Los Angeles Economic Development Commission says Wal-Mart’s entry into the Southern California grocery market would be a huge net gain for the region’s economy, consumers and, ultimately, workers. The study was commissioned and paid for by Wal-Mart, so it’s bound to be, and should be, subjected to rigorous examination. But according to this LA Times article, the study was the first in the region to look at both sides of the equation: not just the possibility of lower wages for grocery store workers but the ripple effect of all the money saved by grocery consumers. The report says customers will save an average of 15 percent on their groceries as the first Wal-Mart supercenters open, and possibly more later. Customers who stick with other markets will save an average of 10 percent. And all that money that people save – at least $668 million annually in the city of Los Angeles and more than $3 billion in the seven-county region – would be spent on other items, including housing, health, entertainment and transportation. Those redirected savings, which far exceed the wages lost by grocery workers, will create new jobs, at least 6,500 in the city alone, the study says. Regionwide, the change could cost 3,500 to 5,100 jobs because of the reduced purchasing power of lower-paid grocery workers while creating 36,400 new jobs outside the grocery business, according to the report.

Posted by dweintraub at 12:57 PM



The partly cloudy state

Despite repeated promises from Schwarzenegger, including another one Tuesday, the governor’s staff continues to refuse to release documents that would allow the public to compare and contrast various alternatives for cutting the state payroll. The Department of Finance says that to do so would cripple the office’s ability to effectively advise the governor. Funny thing is, the department’s director, Donna Arduin, is fresh off a stint advising Gov. Jeb Bush of Florida, a state where virtually every document the government produces is available to the public, where every meeting the governor holds must be published on his public schedule. Yet Florida’s Sunshine law doesn’t seem to have prevented Arduin from effectively advising Bush. Why would a similar law hamper her here? I'll have more to say on this topic in Thursday's column.

Posted by dweintraub at 8:56 AM



I think the dog-catcher gets more votes in LA

So John Kerry has won a convincing victory in New Hampshire, enough to cement his front-runner status and place him only a primary victory or two from claiming the Democratic nomination for president. Kerry accomplished that feat on the strength of about 85,000 votes cast by Granite State Democrats -- far fewer than the 122,000 votes my local state senator received in her last reelection campaign. Howard Dean won a solid second place, with fewer votes than my assemblyman – one of 80 in the California Legislature – got last time. And then there were John Edwards and Wesley Clark, fighting it out for third place with about 26,000 votes each, about as many as it took to finish third in the most recent race for the Sacramento city school board. Poor Joe Lieberman. The senator from Connecticut pulled down about 18,000 votes, leaving him mired in fifth place. If 8,000 or so more New Hampshirites (New Hampshirians?) had felt the “Joe-mentum” and gone with Lieberman, he’d be the surprise third-place finisher and the darling, for the moment, of the national media. Ok, I know we have said this before, but just for the record, it’s nuts. I’ve got nothing against retail politics, and it’s great to put the candidates through their paces up close and personal in a tiny northeastern state that looks nothing like the rest of America. But does it have to be winner take all (momentum-wise, if not in the delagate count)? Can’t we just say, hmm, that’s interesting, people in one small frigid corner of America seem to like the senator from next door and the governor from the state on the other side of them more than they do a couple of fellows from the South. I wonder how the South feels? Or the West, for that matter. Gee, maybe we should see what the voters in the nation’s biggest state think about all of these candidates? Nope. Let the winnowing continue. Next stops: South Carolina, Missouri, Oklahoma, Arizona, Delaware, New Mexico and North Dakota. Go for the underdogs, guys. Keep hope alive!

Posted by dweintraub at 6:44 AM



January 27, 2004

Work comp reforms not "bogus"

The medical cost reforms to California's workers compensation system approved by the Legislature and Gov. Gray Davis last fall should pay big dividends in the months and years ahead, says a new report from the state auditor. The auditor examined claims paid in 2002 by the State Compensation Insurance Fund and found that the new fee schedule for outpatient surgery centers would have saved insurers at least 50 percent on the fees paid to those facilities, and the new schedule for prescription drugs would have saved 25 percent. Here is a link to the state auditor's site. The audit will probably be used by Democrats in the Legislature to suggest that Schwarzenegger should let the recently passed reforms take root before demanding more. During the campaign, Schwarzenegger called those reforms "bogus." It now appears that at least this set of changes was legitimate.

Posted by dweintraub at 10:51 AM



Business as usual

During the campaign and shortly after taking office, Gov. Arnold Schwarzenegger promised to throw open California’s government documents to public scrutiny. “We will share everything with the press,” he said at his first news conference as governor. “This will be a very unusual situation.” But so far, Schwarzenegger is following the same policies of his secretive predecessor, denying public access to his calendar, internal state communications and even documents that show the impact of the layoffs that are coming under his budget plans. This week Schwarzenegger’s Department of Finance, mimicking Gray Davis’ Department of Finance, refused to release those documents, saying that doing so would put a chilling effect on future budget discussions. Here is the story in the Bee.

Posted by dweintraub at 6:29 AM



January 26, 2004

Opening act

Dennis Miller's new chat show debuts tonight on CNBC (9 pm Pacific) and his first guest is: Arnold Schwarzenegger. These two are old friends, so don't expect Miller to be grilling the governor on the details of his fiscal recovery plan.

Posted by dweintraub at 12:00 PM



January 23, 2004

Fat chance

Californians spend more than $7 billion a year in medical costs attributable to obesity, a new study says. I hope this isn’t the first step in trying to make the food industry the new tobacco industry. But it’s interesting nonetheless. Here is a press release on the study, which was done by a private research firm and the Centers for Disease Control and Prevention. The actual paper is available here, for a fee.

Posted by dweintraub at 1:15 PM



Fiscal shop of horrors

California's house of fiscal cards can bewilder even the most expert observers, with its layer upon layer of different kinds of borrowing, most of which are due to be repaid in June, when the state, according to current projections, will lack the cash to do so. One of the state's financial advisers, E.J. De La Rosa & Co., has circulated (on its own, not on behalf of the state) a nifty, four-page document explaining all of this in fairly accessible terms. It also speculates about what might happen if the voters reject the Schwarzenegger bonds and the courts reject the Davis bonds that were approved by the Legislature last summer. Assuming the reader begins with a basic level of interest in the subject, the De La Rosa report reads like the script for a horror film, starting out slow, introducing the characters and the plot, and finally leading to a climax that will make the squeamish avert their eyes. I highly recommend it. Download the PDF document below. (Thanks to DM for passing it along.)

Download file

Posted by dweintraub at 12:15 PM



January 22, 2004

Workers comp profits dip

Labor lobbyists say the way to fix workers comp is to regulate insurance rates. But the latest numbers show insurers are still losing money in California -- an average of 17 percent last year, even as rates are soaring. Here is the story in the Bee.

Posted by dweintraub at 7:17 AM



Jobbed

A new study shows that even as California recovers from the last recession, the new jobs being created are concentrated in low-wage industries while the jobs lost were in more lucrative manufacturing and information technology. Since the recession ended nationally in the fall of 2001, new jobs created in California have been in industries that, on average, pay 40 percent less than the sectors where jobs were lost. The study, by the left-leaning Economic Policy Institute, says the same thing is happening all across the country, but California’s trend is worse than all but three other states. Interestingly, only two states are creating more high-paying jobs than they are losing, and one of them is Nevada. Here is a report in the LA Times that says a similar study is documenting the same trend in the LA region.

Posted by dweintraub at 7:11 AM



January 21, 2004

Folsom Prison blues

It’s probably not a subject too many Californians care about, but the lid seems to be coming off the state prison system. The latest disclosures come from a legislative hearing looking into a riot at Folsom in 2002, the prison’s reaction to it and a culture of denial, cover-up and intimidation within the system. Meanwhile, legislators are raising appropriate questions about Schwarzenegger’s proposal to downsize the independent Inspector General’s office and move it under the purview of the agency secretary. Here is the story in the Bee.

Posted by dweintraub at 11:42 AM



January 20, 2004

Spending limit?

Gov. Schwarzenegger kicked off his campaign today for Props. 57 and 58 – his $15 billion bond measure and the new budget reserve requirement that accompanies it. We figured, based on his previous statements, that the governor would put the best face on Prop. 58, describing it as the equivalent of “tearing up the credit card” even though its balanced budget requirement has enough loopholes to drive a Hummer-sized deficit through. But the first press release from the campaign also said the proposal would limit the growth in state spending to “no more than the growth in the state’s economy.” I’m not a big fan of formula-driven spending limits, but that statement is simply untrue. The measure includes no such provision. Schwarzenegger proposed a spending limit last fall but then agreed to a reserve requirement without one – the measure that eventually became Proposition 58. I asked Todd Harris, the campaign spokesman, about this distortion. Via email, Harris responded that the measure limits spending “by not allowing borrowing.” Aside from the fact that Schwarzenegger’s measure does not prohibit all borrowing, even a real prohibition on borrowing would not be a spending limit. At best, the governor could claim that his measure leaves intact the state’s existing Gann spending limit, but that limit has been amended so many times with exceptions that it is widely seen as irrelevant at this point.

UPDATE: Harris now acknowledges that the press release was in error regarding the spending limit. The line was an editing oversight, he says, and not an intent to mislead.

Posted by dweintraub at 4:22 PM



LAO: boost charter schools

California should remove its cap on the number of charter schools that can be created, give the schools more freedom over categorical programs, allow universities, non-profit groups and other entities to approve and oversee charters, and limit the fees that school districts can charge the reform-oriented schools, the Legislative Analyst recommends in a report released today. Here is a link to the full report.

Posted by dweintraub at 1:26 PM



From high-tech to bio-tech

It's not exactly upbeat, but a new report suggests that job losses in the Silicon Valley are slowing and the region has a bright future, in part due to the coming expansion of the bio-technology industry. Here is a link to the Silicon Valley Index from Joint Venture: Silicon Valley.

Posted by dweintraub at 8:56 AM



Nomination nonsense

This is what I love about the presidential nominating process. A week ago, the Field Poll told us that California Democrats ranked the candidates this way:

Dean 25
Clark 20
Lieberman 12
Kerry 7
Gephardt 6
Edwards 3

Now, after fewer than 200,000 Iowans voted in caucuses Monday night, Gephardt is done, Kerry is soaring, Edwards has new life and Dean is in trouble. I would love to see a new poll showing how Californians see the race today. But will it even matter? By the March 2 primary, chances are, Democrats here will see it pretty much the way their brethren in the early primary states saw it. Because they won’t have any choice. The race will either be over or, if it is a truly unique year, it will have come down to two, possibly three candidates by then. At which point California's huge cache of delegates will go to whoever did well in Arizona or South Dakota or Delaware.

Posted by dweintraub at 6:13 AM



January 16, 2004

Taxing high-earners

Democrat Assemblywoman Wilma Chan of Oakland, backed by 24 of her colleagues, has introduced a bill to increase the top income tax rates in hopes of raising about $3 billion a year. Chan’s bill, AB 1815, would boost the top rate from the current 9.3 percent to 10 percent on singles with taxable incomes of more than $136,000 a year and joint filers earning $272,000. The top rate for individuals with incomes of $272,000 and couples earning $544,000 annually would go to 11 percent. Chan says her bill would affect the top 2 percent of California wage earners. I still expect Schwarzenegger to wiggle his way through the year without a tax increase. But I would not be shocked if, facing a stalemate this summer, he were to agree to place a bill like this on the November ballot and let “the people” decide whether to hike taxes or cut more programs. In my column this Sunday I will discuss the latest figures on the rise and fall of California’s super-rich and the implications for the state’s budget shortfall..

Posted by dweintraub at 2:16 PM



Unemployment down, jobs numbers conflict

California’s latest employment figures illustrate the widening gap between the two survey methods, one of employer payrolls and the other of households. The payroll survey shows employment dropped in December as companies shed 8,400 jobs during the month. The household survey, on the other hand, shows an increase in the number of people reporting they hold jobs, up 39,000 over November’s figure. In any case, the official unemployment rate dropped a tick in December to 6.4 percent, down from a revised 6.5 percent in November. New claims for unemployment insurance also dropped, by about 25 percent. Here is the Employment Development Department press release.

Posted by dweintraub at 11:19 AM



No-shows

California's Democrats can't be surprised that none of the major candidates for president are showing up at their state convention this weekend, with the Iowa caucuses scheduled for Monday and the New Hampshire primary eight days later. Instead, the Dems are getting stand-ins and surrogates. Among them: Wesley Clark Jr. comes to San Jose Saturday to stump for his dad.

Posted by dweintraub at 9:56 AM



The Jones Juggernaut

Schwarzenegger's endorsement of Bill Jones today for the US Senate appears to be a simple case of payback for Jones' relatively early backing of Schwarzenegger in the recall race last year. It could also be a consolation prize for Jones not getting a slot in Schwarzenegger's cabinet, which he had sought. But it's not exactly new politics. Staying out of the race, or endorsing either of the moderate women running for the seat (Rosario Marin and Toni Casey), would have been the more eyebrow-raising thing for Schwarzenegger to do. On the other hand, at this point, neither one is showing much strength, and Jones' biggest threat at the moment is coming from the right, in the person of former Assemblyman Howard Kaloogian. Kaloogian is to Jones as McClintock was to Schwarzenegger. So the governor probably has some empathy there.

Posted by dweintraub at 9:54 AM



Field: Bush leads in California

Dean and Clark are atop what looks like a two-man race for the Democratic presidential delegates from California, but President Bush holds at least a narrow lead in hypothetical matchups with all the Democratic contenders. So says the latest Field Poll.

Posted by dweintraub at 7:04 AM



January 15, 2004

Uphill battle

Here is my column on the PPIC poll results, which show that Schwarzenegger's bond proposal is trailing in early surveys. Here is a link to the poll. And here is the Field Poll, also released today, which shows pretty much the same thing. My take: the bond will climb into the 40s once voters identify it as part of Schwarzenegger's fiscal package. Then he will have to drag it over the finish line with a focused and personal paid advertising campaign in the $10 million range.

Posted by dweintraub at 6:43 AM



January 14, 2004

Rescue California, the sequel

Rescue California, the campaign committee funded by Rep. Darrell Issa to gather signatures for last year’s recall campaign, has morphed into “Rescue California… from budget deficits” and will sponsor a spending limit initiative that it hopes to place on the November ballot. The measure is largely patterned after a limit authored by Assemblyman John Campbell and Jon Coupal, president of the Howard Jarvis Taxpayers Association, and offered as the most conservative alternative during December’s debate over spending limits and reserve requirements. It would cap spending growth at the rate of population growth and inflation, with half of any revenue above that amount going toward an accelerated repayment of Schwarzenegger’s $15 billion bond, if that passes in March. The other half would go to a new budget reserve that could reach 10 percent of the general fund. Excess monies after that would be split between school construction and sales tax reductions.

Given Rescue California’s access to thousands of small donors and activists who participated in the recall petition drive, the group’s chance of collecting the 600,000 valid signatures needed to place the measure on the ballot are excellent. That would put Schwarzenegger on the spot. He campaigned for a spending limit and proposed one in December but backed off in favor of a compromise with Democrats that gave him only a modest reserve requirement and some restrictions against future borrowing. He has said he would not seek to place a stricter limit on the ballot. But will he oppose one if others qualify it?

Posted by dweintraub at 9:57 AM



Bush improves standing in state

Thanks to a jump in support from Democrats, President Bush's approval rating in California is on the rise, according to the latest Field Poll. The survey shows that 52 percent of registered voters approve of his performance, compared to 46 percent in the last poll, in September. Here are the full results.

Posted by dweintraub at 6:20 AM



January 13, 2004

Beat me to it

In my column January 8 on the governor's proposal for a comprehensive review of state operations, I mentioned a retail executive's suggestion that the state implement online reverse-auctions to get suppliers bidding against each other in real time to lower the costs of goods purchased by the state. Turns out such a system may soon be in the works, thanks to AB 722, by Assemblywoman Barbara Mathews. The bill passed last year and took effect Jan. 1. It allows the Department of General Services to implement reverse auctions. Estimates of potential savings range from 10 percent to 50 percent. Here's a Senate analysis of the bill.


Posted by dweintraub at 5:23 PM



Hill weighs in

Legislative Analyst Liz Hill is out with her quickie review of the governor's budget, and the verdict is mixed. She says his economic, revenue and caseload forecasts are reasonable, and she notes that the plan, if enacted, would cut the projected structural deficit from $15 billion to about $6 billion a year from now. But Hill questions at least $1 billion in projected savings on which Schwarzenegger is counting and asks how he intends to bring spending and revenues the rest of the way into balance. Here is the page where you can find the full report.

Posted by dweintraub at 11:27 AM



Senate race shaping up

With former Assemblyman Howard Kaloogian’s formal entry into the Republican primary for the US Senate Monday, the contours of the four-way contest have begun to come into clearer focus. Kaloogian, with his strong opposition to Bush’s immigration proposal and an endorsement from Prop. 187 co-author Ron Prince, is staking out the Tom McClintock wing of the Republican Party, trying to nail down the party’s grassroots base the way Bill Simon did in the 2002 governor’s primary. Former US Treasurer Rosario Marin, meanwhile, is portraying herself as the Bush Republican in the race, strongly backing the president’s tax cuts and endorsing, in concept, his immigration plan while still letting it be known that she is to Bush’s left on abortion. Former Los Altos Hills Mayor Toni Casey, also a big Bush backer, wants to be the high-tech, Silicon Valley, modern-woman candidate, though it’s not clear there is enough room in that portion of the Republican spectrum for both her and Marin. Finally there is former Secretary of State Bill Jones, who is running as the Bill Jones candidate: tried, tested, known, conservative socially and personally but a pragmatist politically, not terribly exciting but supported by party bigwigs like former Govs. George Deukmejian and Pete Wilson.

Posted by dweintraub at 6:46 AM



January 12, 2004

Unintended consequences

Over the past two years, the Legislature has passed "tenants rights" bills that force landlords to go through more hoops when using a security deposit to pay for cleaning or repairs after a tenant moves out. The Bee reports this morning that landlords say they will recoup their costs by seeking higher rents rather than deal with the new requirements on deposits.

Posted by dweintraub at 10:31 AM



January 9, 2004

A small forest saved

Schwarzenegger's budget proposal released Friday was the first not presented in a telephone book-sized document. Instead, it was offered online and in compact disc form. Most of the printed summary books, meanwhile, were on an inexpensive stock, not the glossy paper of past years. The Finance Department says this saved $98,000 and 12.2 metric tons of paper.

Posted by dweintraub at 5:27 PM



Budget blues

Gov. Arnold Schwarzenegger is scheduled to lay out his first budget proposal at 11 a.m. today, but most of the key elements of the plan were published in various reports this morning, and there is only one word for it: ugly. The proposal seeks to shift $1.3 billion in property tax money from local governments to the schools, effectively saving the state the same amount of money, just weeks after Schwarzenegger won applause from city and county officials for holding them harmless from the effects of his cut in the car tax, or vehicle license fee. The budget would raise community college and university fees, cut $900 million in transportation spending, and reduce health and welfare programs by about $4 billion this year and next. Unlike recent budgets, this one does take a whack at the state’s prison operation, looking for a reported $400 million in cuts there, and it seeks hundreds of millions in relief from soaring state pension costs. The plan also relies on a projected $500 million from Indian gaming revenues and $350 in federal money. Even with all of that, it still only halves the state’s structural gap between ongoing revenues and expenses, slicing it from roughly $10 billion to somewhere just north of $5 billion. Translated, that means that even if Schwarzenegger gets everything he’s asking for and the economy performs as expected, he would still be facing a projected $5 billion to $6 billion gap in his next budget a year from now. Here is the Bee's account, and here is the story in the Chronicle.

UPDATE: Finance Director Donna Arduin notes that the current structural gap is about $14 billion, counting the money the state is giving local government to make up for Schwarzenegger's reduction in the car tax. She says the 04-05 budget as proposed includes just $3 billion in one-time measures. And she believes that the reforms the governor has proposed, if enacted, would wipe out the rest of the structural deficit. She concedes that others -- including Legislative Analyst Elizabeth Hill -- might conclude that the ongoing gap, before counting any savings from proposed reforms, is in the neighborhood of $5 billion.

Posted by dweintraub at 7:49 AM



January 8, 2004

The $2 billion deal

Gov. Schwarzenegger, using a Sacramento middle school as his backdrop, today officially unveiled his proposal – supported by the education lobby – to give schools $2 billion less in the next fiscal year than they would have been entitled to by a strict reading of Proposition 98. The schools will still get more next year per pupil than they got this year, enough to cover enrollment growth and cost-of-living increases. And the $2 billion they will forgo remains part of the base upon which their future budgets are determined. But Schwarzenegger saves that money this year and can use it for other programs. The deal has two advantages for Schwarzenegger. The first is mathematical: it gives him $2 billion he can use to help close the budget gap. The other is political. By taking education funding off the table, he makes it much tougher for Democrats in the Legislature to argue for a tax increase. They cannot say they need the money for schools, the most popular program provided by state government. Instead, they’ll have to argue for higher taxes to fund health and welfare programs for the poor. Fair or not, that’s simply a tougher sell with the voters.

Posted by dweintraub at 4:15 PM



A $1 billion hole

Gov. Arnold Schwarzenegger's first budget, I'm told, is likely to be $1 billion out of whack on the day it's proposed. That's because it includes reductions in payments to Medi-Cal providers that have been struck down by a federal judge. In addition to the 5 percent cut approved by the Legislature and Gov. Gray Davis last summer, Schwarzenegger was looking to cut another 10 percent from rates paid doctors, hospitals and other providers in the coming year. But federal Judge David Levi ruled those cuts invalid in a Christmas Eve order. By then, the budget document Schwarzenegger will propose Friday had already been put to bed. So the cuts -- and the potential savings to the state -- will show up as part of the plan even though it is extremely unlikely that they can be implemented any time soon, if ever.

Posted by dweintraub at 11:56 AM



New speaker

Fabian Nunez, a 37-year-old freshman lawmakers, has officially been elected as the next speaker of the California Assembly. Nunez represents central Los Angeles and was the former political director of the Los Angeles County Federation of Labor. He is scheduled to assume the post Feb. 9, taking over for Herb Wesson, who is termed out.

Posted by dweintraub at 11:42 AM



Lowered expectations

The Chronicle reports that Schwarzenegger's budget proposal will include less than $1 billion that he hopes to extract from Indian gaming tribes.

Posted by dweintraub at 6:51 AM



No early release

Ten days after administration sources told The Bee that Schwarzenegger was considering early release of prison inmates to save money, his top Corrections official said Wednesday that the governor will not propose such changes in the budget he unveils Friday. Here is the story.

Posted by dweintraub at 6:46 AM



January 7, 2004

Schwarzenegger names tribal negotiator

Looking to increase the state’s financial take from Indian gaming, Gov. Arnold Schwarzenegger has named as his lead negotiator with the tribes a former appellate court judge and legal adviser to Pete Wilson who negotiated the state’s first compacts with the Indian casinos. Daniel Kolkey is a partner at the San Francisco office of Gibson, Dunn and Crutcher. Until November he was an associate justice for the California Court of Appeal’s third district, headquartered in Sacramento. From 1995 through 1998 Kolkey was legal affairs secretary and counsel to former Gov. Wilson. In a telephone conference call with reporters Wednesday, Kolkey said he would work to increase the financial contribution the tribes make to the state from their casino profits, try to protect the rights of casino patrons and improve protections for communities surrounding the casinos. He offered no specifics on the percentage of casino profits he thinks is appropriate for the tribes to share with the state.

Posted by dweintraub at 2:46 PM



January 6, 2004

Blowing up the boxes

Gov. Arnold Schwarzenegger’s first State-of-the-State address Tuesday was not filled with new content. But it did set a tone, reinforcing his two-edged style of calling for bipartisan cooperation while threatening to go directly to the voters if legislators don’t give him most of what he wants. In what a top aide said was the opening shot of a eight-week campaign to persuade voters to pass the first pieces of his fiscal recovery plan, Schwarzenegger added few new details to an agenda he laid out in the campaign and early days of his administration and barely mentioned the state budget, which he will address in depth on Friday.

But Schwarzenegger didn’t need to delve into details in this speech, which was his first chance to be seen at length by the people of California. His inaugural address Nov. 17 was at 11 a.m. on a workday and was probably seen by relatively few voters. So this speech was aimed as much at them as at the legislators seated in the chambers. Viewed on television, he seemed polished, prepared, at ease. The speech swung back and forth between inspired rhetoric and nuts and bolts talk about the workings of government. It was a fairly effective introduction to his vision for California: get the fiscal house in order, reform government, create a climate that encourages job growth, and then – and only then – spend the revenue that flows from that new prosperity.

In a 26-minute address interrupted about 40 times by applause, the new governor recapped the progress he and the Legislature have made since he took office – rolling back the car tax, repealing an unpopular bill that gave drivers licenses to illegal immigrants, and passing a $15 billion bond measure, state budget reserve requirement and balanced budget amendment that will appear on the March 2 ballot. He also warned of tough measures ahead, saying the budget he will propose Friday will contain “cuts that will challenge us all” and vowing to stick by his pledge to avoid any tax increases.

“We cannot give what we do not have,” he said. “If we continue spending and don’t make cuts, California will be bankrupt.”

The centerpiece of the relatively brief address was probably Schwarzenegger’s call for “radical” ideas to overhaul state government. He said he would appoint a commission to oversee a team of civil servants to conduct a top-to-bottom review of the government, examining every program to determine if it is still needed and, if so, whether it can be managed more effectively.

“Every governor proposes moving boxes around to reorganize government,” Schwarzenegger said. “I don’t want to move the boxes around. I want to blow them up.”

Calling the executive branch a “mastodon frozen in time” and “about as responsive,” the governor said he wants to consolidate departments with overlapping responsibilities, abolish boards and commissions that serve no pressing need and modernize a state purchasing system that he called archaic and expensive. “I plan a total review of government – its performance, its practices, its cost.”

“I want your ideas,” he told lawmakers, “and the more radical the better.” He extended the same pitch to state employees, saying he wanted to give them freedom to do their jobs in “creative ways.”

Schwarzenegger reiterated his plan to free local school districts to spend more of their budgets as they please, and his staff said he will propose cutting the strings on 22 “categorical programs” and giving local districts control over $2 billion in money that has been directed from Sacramento. On energy, he called for a consolidation of 13 state agencies with a stake in the issue, complaining that it is easier in California “to create energy agencies than power plants.” He also renewed his pledge to encourage construction of a “hydrogen highway,” called for an expansion of solar power and a new state bank to encourage energy efficient retrofits of older buildings.

On the economy, Schwarzenegger called himself a “salesman by nature” and said he was eager to sell California to the world as a place to do business.

“I’m going to say, ‘Come to California. Come do business here. Buy our fantastic products. Visit our special attractions. Hire our workers, who are the most productive in the world.”

But Schwarzenegger also said he and lawmakers needed to fix the state’s business climate before he could make that pitch wholeheartedly. The core of that effort, he said, would be his proposal to bring California’s workers compensation costs in line with the rest of the nation – by March 1.

“Modest reform,” Schwarzenegger said, “is not enough. If modest reform is all that lands on my desk, I am prepared to take my workers comp solution directly to the people, and I will put it on the ballot in November.”

Schwarzenegger ended his speech on an optimistic note.

“I remain a great believer in the future of this state,” he said. “I did not seek this job to cut, but to build. I did not seek this job to preside over the decline of a dream but to renew it. President Reagan said that empires were once defined by land mass, subjugated peoples and military might. But America, he said, is an ‘empire of ideals.’ California, I believe is an empire of hope and aspirations.”

Schwarzenegger’s speech was bracketed with appeals by Democrats for tax increases. First Lt. Gov. Cruz Bustamante (in what was supposed to be an introduction of the governor) and then legislative leaders, in their official response, said the cuts Schwarzenegger will unveil Friday could be softened by taxing the most affluent Californians or by raising taxes on alcohol or tobacco. Senate Leader John Burton said it makes no “moral sense, no political sense” and little fiscal sense to cut taxes on the wealthy while cutting services to the poorest of the poor. But that call seemed unlikely to win many fans in the wake of Schwarzenegger’s can-do but mostly pain-free address Tuesday. A more substantive ideological battle on the fiscal front will kick off Friday when legislators, and voters, get their first detailed look at the cuts Schwarzenegger has in mind for the programs they value and depend upon.


Posted by dweintraub at 3:43 PM



Is a $2 billion increase a cut?

The LA Times reports here that Schwarzenegger, as expected, intends to propose a budget that falls short of giving the public schools everything they are due according to Proposition 98, the constitutional amendment that sets minimum funding requirements for public education. The formulas would provide the schools something around $4 billion in new money next year. Schwarzenegger plans to offer about $2 billion. That would be enough to cover enrollment growth and increases in the cost of living. Most people would consider that an increase in funding. But because the guv will not give the schools all that they expected, some will say this is a cut. The Times' report, however, suggests that the education lobby is going to support the move as a compromise that keeps them above water in the short term while promising to make good as soon as next year on the money they forgo in this budget.

Posted by dweintraub at 8:35 AM



January 5, 2004

State of the Pomp

Assembly staffers report receiving 255 requests for credentials from media hoping to witness Gov. Arnold Schwarzenegger’s State-of-the-State address Tuesday afternoon. Alas, the chamber can accommodate only a fraction of that number. At last count 20 print reporters, 10 radio reporters, 12 television crews and 7 still photographers will be allowed on the floor. A separate viewing tent is being erected on the Capitol’s north lawn. Immediately after the speech, it will become the spin tent, as legislators from both parties and members of the governor’s cabinet descend upon it to give their take on the address. A timeline provided to reporters suggests that the governor expects his speech to last about 25 minutes. He will be introduced by Lt. Gov. (and former election rival) Cruz Bustamante.

Posted by dweintraub at 12:43 PM



 
 

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