Governor Signs Budget, Vetoes $663 Million

Gov. George Deukmejian, vetoing increased spending for education, AIDS prevention and trauma centers, signed a $40.5-billion state budget Tuesday for the fiscal year that began July 1.

Deukmejian, in vetoing a total of $663 million from a broad range of state programs, cut $170 million in aid to school districts, trimmed health care for the poor by $161 million, reduced funds for Alzheimer’s disease by $19 million and eliminated Cal-OSHA, the agency responsible for protecting worker safety.

At the same time, the Republican governor set aside a $1-billion reserve fund for emergencies. And he carried over from last year a $1.1-billion surplus that he has proposed returning to state income taxpayers.

In all, the budget for the 1987-88 fiscal year will increase spending by $3.5 billion over the budget Deukmejian signed a year ago. When federal funds distributed by the state are included, California’s spending for the new fiscal year will total nearly $55.9 billion.

Deukmejian’s vetoes--amounting to 1.6% of the state budget--drew immediate criticism from Democratic legislative leaders and state schools Supt. Bill Honig.

“His vetoes are really evidence of a mean spirit in California,” charged Senate President Pro Tem David A. Roberti (D-Los Angeles). “They are all tragic, destructive of people’s hopes.”

Assembly Speaker Willie Brown (D-San Francisco) blamed the vetoes on Deukmejian’s “meanness” and “indifference,” adding, “I am totally and completely surprised at the nature of the cuts, and the length and width and breadth of the cuts made by this governor.”

Although Deukmejian has insisted that education is his top priority, the governor’s vetoes reduced the proportion of the state’s General Fund--or operating budget--that is earmarked for education from 55% to 54%.

Under the budget signed by the governor, the state will spend $12.5 billion on kindergarten through high schools, an increase of 2.7% over the last fiscal year. However, Honig argued, the budget will leave school districts short of what they need by about $470 million, further handicapping their efforts to keep up with increases in enrollment and inflation.

Funds for Schools

Deukmejian vetoed $170 million in funds for kindergarten through 12th grade, cutting into spending he was willing to support earlier this year. That included $87 million from two programs--Urban Impact Aid and Meade Aid--designed to help school districts with large numbers of economically disadvantaged students.

Brown was particularly incensed by the governor’s veto of the aid to urban districts, which he said will most hurt minority students. “What he did to urban impact aid is easily the most offensive . . . and shows a genuine indifference to black folks,” said the Speaker, who is black.

Honig also criticized the governor for vetoing funds for special education, teacher training, child care and programs to prevent students from dropping out of school.

During months of intense battling over the budget, Deukmejian and Honig had traded angry charges--and the governor clearly had the last word with his vetoes.

Deukmejian targeted Honig’s Department of Education for a $7.8-million cut, about 10% of the agency’s total budget--a move Honig said would make it more difficult for him to carry out his program of improving schools.

“Out of the blue, he singled us out,” Honig protested. “That 10% is going to seriously hamper our ability to keep the reform movement going.”

Roberti observed, “It shows you criticize George Deukmejian at your own risk and the risk of your constituents.”

Although the governor’s advisers insisted all the vetoes were made strictly on their merits, Deukmejian Chief of Staff Michael R. Frost acknowledged the Administration’s bitter feeling toward the schools superintendent when he charged Tuesday that Honig had “done a great deal of damage” to education this year.

Because he “politicized” the issue of school finance, Frost said, Honig destroyed “the bipartisan coalition” that included business leaders and Republican lawmakers who long had supported education funding. “It’s now going to be our responsibility to put it (the coalition) back together without his (Honig) being a participant,” Frost said.

Some of Deukmejian’s most controversial budget cuts came in the area of health care, where he vetoed at least $240 million, affecting AIDS programs, trauma care centers, Alzheimer’s disease treatment and health care for the poor.

To combat AIDS, Deukmejian approved a $63-million budget, including $18 million proposed by the Democratic-controlled Legislature. However, he vetoed another $23 million for AIDS education and treatment programs.

Finance Director Jesse R. Huff pointed out that the $63 million approved by the governor is double the amount spent by the state last year and insisted it is as much as can be used wisely.

Another $30-million cut by Deukmejian would have gone to operate trauma centers that have been plagued by financial problems because of a large number of uninsured patients. That figure included about $10 million earmarked for trauma centers in Los Angeles County.

Roberti, a strong critic of the governor’s tax rebate plan, said: “I guess you will be quite happy with your (tax) rebate if you don’t have to worry you are going to be an accident victim on the roads and highways of California.

“There is no other way of keeping these trauma centers open without some kind of assistance from the state of California,” he said. The Senate leader added that no legislation implementing Deukmejian’s tax rebate proposal would pass his house this year.

Deukmejian vetoed $19 million added by the Legislature for research into Alzheimer’s disease and treatment for those afflicted with the disease. However, aides to the governor said a $2-million increase he approved to combat Alzheimer’s represents a 44% increase in funds for that purpose.

Other health care vetoes by Deukmejian included $69 million in funds to assist “medically indigent” low-income people, $67 million to help pay for Medi-Cal patients and $25 million to pay health care facilities that have a high proportion of Medi-Cal patients.

As expected, Deukmejian also cut $7 million from the budget of Cal-OSHA, effectively gutting the state’s worker safety program.

In January, Deukmejian said he would eliminate the program and turn its responsibilities over to the federal government. But his critics charged that the governor was dismantling the most effective state job safety operation in the nation in exchange for a much weaker federal program.

In his longstanding effort to dismantle the California Coastal Commission, Deukmejian cut $320,000 from the agency’s budget, closing the Santa Barbara and Santa Cruz offices. Deukmejian said that fewer Coastal Commission offices and staff members are needed because the agency is nearing completion of its charge to draw up local coastal plans in these areas.

Coastal Commission Chairman Michael Wornum called the action a “breach of faith” on the part of the governor, who Wornum said had agreed on the budget figure with the commission’s staff.

The governor’s budget includes $294.3 million for hazardous waste enforcement, an increase of 31% over last year.

Because of Deukmejian’s vetoes, more than $78 million in federal funds, including matching money for Medi-Cal and Cal/OSHA, will be returned to Washington.

In its final form, the budget is $45 million beneath the state spending limit. Any unexpected increase in revenues above that amount this year could again trigger a political battle over the spending limit and a potential tax rebate.