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Gov. Jerry Brown's fiscal pitch gets warm reception

SACRAMENTO — Gov. Jerry Brown received a warm welcome from lawmakers Monday as he pitched his proposal to pay off debt and save money for future economic downturns.

He faced only one mild question during a rare appearance before a legislative committee, joked about what office he might hold more than a decade from now and played his greatest-hits talking points about stabilizing California's tumultuous finances.

"There's nothing complicated about the idea of saving money," Brown said as he urged Democrats and Republicans to unite behind his proposal. "Voters can understand it."

Brown's testimony before the Assembly Budget Committee, part of a special legislative session he called to focus attention on his proposal, was another sign of his willingness to throw his personal political capital behind the measure.

Judging by his reception, Brown is on safe ground. One Republican, Assemblywoman Diane Harkey of Dana Point, praised the governor's handling of the budget and lamented that he "will only be here for another term," already assuming Brown will win reelection in November.

Committee members repeatedly praised the governor, and toward the end of the hearing Assemblyman Richard Hershel Bloom (D-Santa Monica) added, "I'm not going to rain on this parade."

Under Brown's proposal, spikes in revenue from capital gains taxes would be placed in a reserve fund or used to pay debts and other long-term costs, such as public pensions. California has had a reserve fund since 2004, but it has mostly sat empty. Brown says there should be stronger rules on paying into it.

"If we were angels, we wouldn't need any of these things," he said. "We would just, every day and every year, make very wise judgments. But we haven't proven that to be the case, so we're going to try a little bit of protective restraint."

Brown will need Republican support to push his proposal through the Legislature, because criminal investigations have cost Democrats their supermajority in the Senate. His measure, a constitutional amendment that voters would have to approve, requires a two-thirds vote before it can go on the ballot.

One of Brown's opponents in the governor's race, former U.S. Treasury official Neel Kashkari, has said lawmakers should approve Brown's plan, which the Republican candidate called "a small incremental step in the right direction."

Republican lawmakers have already expressed willingness to back off a competing proposal for a rainy-day fund, which Democrats have criticized as too restrictive on spending. However, the Republicans want more constraints than Brown has proposed to dictate when lawmakers can pull money out of the reserve.

The governor said he was open to compromises, such as raising the vote threshold in the Legislature for withdrawing money and using it to prevent budget cuts during a recession.

There are signs that the Democratic leaders of the Assembly and Senate are divided on some details.

Assembly Speaker John A. Pérez (D-Los Angeles) wants to finalize the measure before the Capitol is consumed by annual budget negotiations, which begin in earnest in mid-May, when the governor releases his revised spending plan.

Finishing early, Pérez told reporters, "lays the foundation for the assumptions of the budget."

Senate leader Darrell Steinberg (D-Sacramento) wants to slow down the debate, expressing concern that it is being rushed.

"A poorly designed constitutional amendment would be difficult to fix," Steinberg said on the Senate floor. "It's therefore paramount in my view that we work purposefully, but we don't rush it."

Steinberg said he wanted to see a greater emphasis on tackling the shortfall in the state's teacher pension fund and restoring money to government services. Advocates for the poor are also urging more funding for healthcare and social services.

Advocates plan to rally Tuesday at the Capitol to call for $5 billion more in spending on such services. They're confounded by Brown's push to save for the future when some cuts made during the recession have yet to be restored.

"We believe in rainy-day funds, but for a lot of people it's still raining," said Anthony Wright, who promotes expanded health coverage at Health Access.

To drive their point home Tuesday, demonstrators plan to carry umbrellas.

chris.megerian@latimes.com

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