Won't 'Holler' About Cutbacks in Federal Aid, Governor Says

Times Sacramento Bureau Chief

If California Gov. George Deukmejian does not stand alone at the winter session of the National Governors' Assn., which convened here Sunday, he is at the very least in the minority.

While most of his fellow governors, both Republicans and Democrats, spent the day in hand-wringing sessions over the effect on their states of President Reagan's proposed federal budget cuts, Deukmejian said the cuts "would not have a dramatic adverse impact" on California.

"We're not going to holler. We're not going to complain or scream about any dollar reductions," he said.

The Republican chief executive also made it clear he has concerns about an advisory resolution on the federal budget being considered by the governors that would call for a freeze on defense spending and hold out a tax increase as a "last resort" solution to the federal budget deficit.

Although the resolution contains two elements he has championed--a call for a federal balanced budget amendment to the Constitution and presidential line-item veto authority over the budget--Deukmejian said he did not know why any further advice from the governors is needed.

"About 100 days ago, the people of this entire country made a decision," he said. "And their vote for the presidential candidate indicates, it seems to me, what their priorities are. . . .

"Constituents of 49 of the governors who are here today . . . decided they wanted this President to remain as President, to be the leader, and it would seem to me that the Congress should follow his lead."

California would lose between $3 billion and $4 billion in various forms of federal aid under the Reagan budget, including substantial amounts to cities and counties in federal revenue sharing funds.

But Deukmejian said the state should be prepared to absorb whatever effect there might be, except that "I do share the view" that the states should be allowed more flexibility in the expenditure of whatever federal aid they do receive.

The governor also seemed to be less concerned than most of his colleagues here about a Reagan Administration claim that many of the states, including California, can fill the gap on some of the proposed cuts because they have built significant surpluses since the recession.

"Whether they should or shouldn't (consider the surpluses), they are going to do it," he said.

The governor also agreed with Assembly Speaker Willie Brown (D-San Francisco) on one point when he said that "in general, I would share the Speaker's view" that local governments in California should not expect help from the state to make up for the loss of any federal money. This is a particularly unusual statement, since Deukmejian and Brown frequently are at odds on most issues.

Brown told The Times last week that local government officials have worn out their welcome in Sacramento and that there is no sentiment in the Legislature to offer them additional assistance.

Deukmejian noted that local governments "did get through" the post-Proposition 13 period with a minimum of difficulty, despite a dramatic cut in their property tax revenue, and last year were assured of a fixed share of various state revenues under a bill he signed into law.

He did not mention, however, that the effects of Proposition 13 were mitigated by massive infusions of state bail-out money.

"I will say," he said, "that we will look at specific areas. If we find, for example, that because of a reduction of federal funding that there is going to be an impact on the health, let's say, of any group of citizens within our state, we'll certainly look at that very seriously to see if there is something we can do to be of assistance."

Deukmejian combined the governors' meeting with some state business Sunday by inviting two candidates for the job as director of the new state lottery to his suite at the Hyatt Regency for interviews.

He reportedly is close to a decision on the director, pending background investigations, and his choice presumably will come from one of the 17 states, plus the District of Columbia, that now have lotteries.

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