GOP leader reportedly backed car fee hike

In private negotiations over the state’s budget crisis, a top Republican legislator has broached the most dreaded idea in GOP circles: taxes.

The leader of the Assembly’s Republicans, Mike Villines of Clovis, has publicly maintained the GOP’s hard line against any tax increases. But last month, he volunteered to other legislative leaders and Gov. Arnold Schwarzenegger that he might support an increase in the vehicle license fee and persuade other GOP lawmakers to go along, according to three people with knowledge of the discussions.

Two of the sources were in the budget meeting where Villines spoke, in the governor’s office on the first floor of the Capitol. It is in such “Big Five” meetings -- restricted to the governor, both party leaders in the Assembly and the Senate, and sometimes a few top aides -- that the key points of budget deals are generally hammered out.

The sources would speak only on condition of anonymity, because none wanted to openly violate the confidentiality that is supposed to surround such negotiations.

Through a spokeswoman, Villines denied Thursday that he had ever supported raising the controversial fee, sometimes called the “car tax.”

But the sources said Villines raised the possibility of GOP support for a higher car fee in budget negotiations last month, saying he thought that he could bring rank-and-file Republicans along if Democrats agreed to steep cuts in government programs and a permanent cap on state spending.

The sources who were in the room said his suggestion came after Democrats offered spending cuts they would reluctantly agree to implement. The sources said Schwarzenegger was trying to prod Republicans to offer ideas for raising more revenue for the state, which faces a financial crisis.

“Villines told me that it was the Republicans’ idea to put that forward, which shocked me,” said an Assembly member, who told The Times that Villines later described the meeting.

The Assembly member, a Republican, said Villines indicated that hiking vehicle fees was preferable to raising the state sales tax, as Schwarzenegger has proposed. The car fee would bring in more money, Villines said, and Schwarzenegger would take much of the political heat for his reversal on it, allowing GOP lawmakers to “hang it around his neck,” the source recounted.

Villines said in his statement Thursday: “Republicans have consistently said no to higher taxes, and our actions have shown that.”

Republicans believe the fastest-growing areas of state government “should be scoured for savings,” the statement said, and the state budget gap -- now estimated to reach $41.8 billion by mid-2010 -- could be resolved without tax increases.

The annual vehicle license fee is currently 0.65% of a car’s value. Schwarzenegger won the 2003 recall election on a platform that included pledging to lower the fee, then 2%.

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jordan.rau@latimes.com