If Forced to Raise Taxes, This Is What I Would Do : Closing income-tax loopholes would be the only major change, but the budget process must be reformed too.

One thing we know for sure: The way the state of California conducts its budget process must change. The inability of the governor and the Legislature to come together to solve budget problems has resulted in frozen mandates on counties, increased partisan bickering and a general loss of the public’s confidence that problems are going to be fairly solved in a timely manner. Instead, citizens go to the ballot to redress unsolved problems through the initiatives, and the Legislature remains in gridlock along with our streets and highways.

California cannot afford eight more years of budget gridlock. We need a governor who will get this state moving again and bring people together to solve problems.

The projected $2-billion shortfall and a possible serious economic downturn mean that we must hold the line on new spending and concentrate on seeing to it that the state’s economic engine continues to pump with jobs and paychecks.

California’s diversified economy puts us in much better shape than many other states. But it must be remembered that a strong and growing economy is the surest and best source of new revenues for the state’s budgetary needs. So, maintaining a strong economy will have my constant attention.

People must also know that the hard-earned dollars they pay in taxes are well and wisely spent. So, careful scrutiny of priorities, elimination of non-necessities and duplication, as well as cost-saving, wherever possible, remain the order of the times. Revenues must be carefully watched as the shortfall figures become more precise and the trigger mechanism forces automatic cutbacks across the board next year.

I supported the three transportation and rail initiatives that passed on the June ballot; they will create a $21-billion opportunity for California to improve its transportation infrastructure. I intend to get control of Caltrans and see that these monies are carefully utilized so that the voters’ intent of major rail and transportation improvements is carried out. With these funds, a rail spine can be built through central California to facilitate new communities so that growth can be managed by putting jobs closer to homes.

I also support Proposition 133 on the November ballot to fight a real war on drugs through a one-half cent increase in the sales tax. The number of law enforcement officers has actually decreased in California, while at the same time our state has become the cocaine and heroin importation capital of America (also the PCP and methamphetamine manufacturing center).

Drug pushers don’t listen to politicians, but they do listen when they’re arrested, put in jail fast and kept there. Proposition 133 would make $7.5 billion available over four years, for added local police, prosecutors and jails, and for the drug prevention we need in every school and county across this state. Today, California is a paper tiger in the war against drugs. With Proposition 133, tomorrow can be different.

I have pledged to protect residential property tax rates--and I will do that.

I also believe that the income-tax changes in Washington and Sacramento in the 1980s have benefitted the wealthiest 5% of the taxpayers, who now actually pay a lower marginal rate than people who earn less than they do. That’s not fair. This loophole should be closed, but income-tax rates for all other Californians must not be raised. Eighty percent of the revenues raised by closing such a loophole would come from couples making more than $500,000 a year. I want to protect working men and women from unfair increases in taxes.

With the $21 billion in rail and transportation funding and the $7.5 billion in Proposition 133 to really fight drugs and crime, California can make major inroads on two areas of voter priorities. Other than the closing of unfair loopholes I foresee no major tax changes at this time.