$37.4-Billion State Budget Gains Approval

The Legislature approved and sent to Gov. George Deukmejian on Thursday a proposed $37.4-billion budget that would expand such programs as AIDS research, toxics cleanup and education but faces a certain veto of at least $300 million.

Altogether, the balanced budget would increase spending over the current year by $1.5 billion without raising general taxes. With a minimum of partisan squabbling, the election-year spending plan cleared the Senate by a vote of 36 to 3 and passed the Assembly by 57 to 20.

“We have prepared a good, proud California budget,” said Assemblyman John Vasconcellos (D-Santa Clara), chairman of the conference committee that drafted the final version of the spending plan. “It’s what I would call a pay-now, save-later budget.”

The legislative version of the budget bears a close resemblance to the one Deukmejian proposed in January and provides the governor with almost every spending proposal he sought, including $700,000 to open trade offices in London and Tokyo to promote California products.

However, the Democratic-controlled Legislature also called for spending about $300 million more than the governor wanted on a variety of health, education and mass transit programs. To do so, the Legislature approved a reserve fund for economic uncertainties of $701 million--well under the $1 billion Deukmejian wants.

The Republican governor has pledged to use his line-item veto authority to cut the Legislature’s budget by at least the $300 million and to transfer that amount to the “rainy day” reserve.

“The budget is still a little fat,” said Steven A. Merksamer, the governor’s chief of staff. “We’re going to take whatever steps are necessary to make sure we have a $1-billion reserve.”

Democrats contend that Deukmejian has deliberately underfunded the budget so that he can claim during his campaign for reelection that he maintained a $1-billion reserve. Citing a pattern of mid-year spending increases sought by the Deukmejian Administration in previous years, they have charged that the governor will dip into the reserve later to pay for programs he refuses to fund now.

Matches Estimates

Deukmejian Administration officials, however, counter that the budget that the governor will sign into law for the fiscal year starting July 1 will match their best estimates of the spending that will be needed. The Administration intends to use the reserve only in the event of emergencies or other unforeseen circumstances, they insist.

For the first time, the budget comes within $20 million of the Proposition 4 spending limit approved by voters in 1979--a ceiling on spending that analysts say is virtually certain to take hold next year.

The spending plan does not take into account the federal Gramm-Rudman deficit-cutting plan that could dramatically reduce aid to California during the coming year. Nor is there money included to pay for spending programs that may be adopted by the Legislature later this session.

In the Assembly, passage of the budget was briefly delayed by the continuing battle over whether state funds should used to pay for abortions for low-income women. However, Republicans were unable to muster the votes needed to prohibit any state spending on abortions or for family planning clinics that refer women for abortions.

Abortion Issue

The budget adopted by the Legislature includes a provision proposed by Deukmejian that would allow Medi-Cal payments for abortion only in cases where the mother has been raped, her life is in jeopardy or the fetus is seriously deformed. Adopted in previous years, the provision has routinely been thrown out by the courts as unconstitutional.

In the Senate, a little-noticed provision sponsored by Vasconcellos that would encourage the establishment of a “human corps” of University of California and state university students to perform community service work as a condition of graduation provoked debate.

One legislator, Sen. Kenneth Maddy (R-Fresno), asked only half in jest whether this would mean that his two college-age daughters would be conscripted to do community work when they should be studying.

Sen. Alfred E. Alquist (D-San Jose), chairman of the Senate Budget Committee, suggested that the “human corps” would never be created and would be “ignored” by university officials.

Funds for AIDS Battle

The legislative budget includes an increase of $22 million for research and prevention of acquired immune deficiency syndrome, which has killed more than 4,000 Californians. However, much of the money is likely to be vetoed by Deukmejian, who favors an increase of about $8 million to combat AIDS.

For education, from kindergarten through the university level, the Legislature added about $15 million more than Deukmejian sought. On toxics, the lawmakers shifted money from administrative programs to actual cleanup programs, paving the way for the hiring of 238 new workers to deal with underground tanks and abandoned hazardous-waste sites.

The lawmakers also added $55 million to the budget to pay for mass transportation programs, including subsidies for bus service in Los Angeles and extension of the San Diego Trolley. The money is intended to partially make up for declining gasoline sales tax revenues prompted by the worldwide drop in oil prices.

Included in the $300 million in added spending approved by the Legislature were higher Medi-Cal payments for doctors and other providers of health care services, more money for educational programs for gifted and disabled students and increased spending for the homeless.

The Legislative budget includes a provision requiring the state Military Department to notify the Legislature if it intends to send National Guard troops to train in countries where armed combat has occurred recently or is likely. The provision was prompted by the recent dispatch of California guardsmen to Honduras.

In several areas, the Legislature cut money where the governor had wanted to spend.

The Legislature voted to reduce the staff of the Agricultural Labor Relations Board by one-fourth amid criticism that the board was biased against farm laborers. This reflects a reversal in recent years from the time when the board, created under Gov. Edmund G. Brown Jr., was accused of favoring farm workers.

The lawmakers also refused the governor’s request to buy new school buses with $100 million that had been earmarked for energy-saving programs. The vehicles would have replaced aging school buses now on the road that do not meet federal safety standards.

With its adoption of the budget, the Legislature met its constitutional deadline three days early. Deukmejian will have 12 days after he officially receives the budget bill to veto any spending proposals and to sign the measure into law.