Honig Sees ‘Sinister’ Deukmejian Motives in Prop. 98 Attacks

State Supt. of Public Instruction Bill Honig accused Gov. George Deukmejian and Administration officials Thursday of having “sinister” motives in their campaign to blame the state’s budget problems on Proposition 98, the school-funding initiative.

Honig, appearing before the Senate Budget and Fiscal Review Committee, criticized Deukmejian in the strongest terms he has used since the two officeholders supposedly patched up their political differences last year.

The schools chief told lawmakers that the real blame for budget woes is an inadvertent $1-billion tax cut given to what Honig called “California’s wealthiest taxpayers” in 1987 tax legislation conforming state and federal tax codes. After the tax shortfall turned up last year, Deukmejian acknowledged it and briefly proposed raising taxes $800 million to correct the problem. But the governor dropped the plan when it received no support in the Legislature.

Honig contends that Deukmejian is “paying off last year’s bill” with this year’s budget revenue.

‘Health, Welfare’

“When somebody says that Proposition 98 is the cause of this, I think there are sinister purposes involved,” Honig said. “They would like to see a fight between health, welfare and schools, and they would like to get the spotlight off where the real problem is, which is the depletion of revenue and these mistakes that were made a year, year and a half ago.”

The counterattack is part of an effort to head off a campaign by Deukmejian and state Finance Director Jesse R. Huff to blame Proposition 98 for the state’s budget problems and argue for repeal or modification of the school-funding measure, along with other laws guaranteeing automatic funding increases to state programs.

Proposition 98 guarantees public schools and community colleges roughly 40% of the proposed $38-billion state general fund budget that Deukmejian is proposing for the new 1989-90 fiscal year.

Deukmejian, blaming Proposition 98, gave the Legislature a new budget Tuesday that saves $337 million by not giving cost-of-living increases that existing state law provides for health and welfare program aid recipients. The budget action would freeze welfare payments to 1.8 million needy Californians at current levels.

Budget Freeze

Huff, who also appeared at the hearing, said at a budget briefing earlier this week that if it had not been for Proposition 98, he would not have proposed the budget freeze on health and welfare programs.

Given several opportunities, he did not respond directly to Honig’s harshest charges.

“I do not intend to stand here and verbally argue numbers with you,” Huff told lawmakers.

Despite Honig’s testimony, committee members clearly appeared concerned about the impact of Proposition 98 on the budget. Sen. Alan Robbins (D-Van Nuys) said that unless modifications are made in legal protections for programs such as public schools, the state will soon reach “budget gridlock.”

During the hearing, a top University of California official said that unless there are amendments made to Proposition 98 and an earlier constitutional amendment limiting the size of state government, UC is not going to be able to take care of surging student enrollments and maintain the university as it has in the past.

Spending Limit

William B. Baker, vice president of budget and university relations, noted that every long-range forecast of state revenues shows that the state will be taking in more money than it will be allowed to spend because of the spending limit approved by voters in 1979 as Proposition 4.

In another development, both Honig and Deukmejian were sharply criticized by spokesmen for Latino groups.

Eric D. Vega, of the Mexican American Legal Defense and Educational Fund, said during a Capitol news conference that Deukmejian’s budget hits “the state’s least fortunate citizens” the hardest. Declaring that the budget has “teeth,” he said “the teeth disproportionately chew on poor people and, in particular, on the Latino people, the minority people in the state.”

Arnoldo S. Torres of Cafe de California Inc., a Latino state employees association, complained that Honig “has done a dismal job of addressing the concerns of Hispanic children” in public schools.

Torres released a report saying that more Latino children than ever are living in poverty and that Latinos have not benefitted as much as blacks or Anglos by the economic recovery that began in 1983. He said the governor’s budget does not effectively deal with the problem.