GOP Leader Offers Plan to Eliminate Shortfall : Budget: Maddy proposal would reshape state government. Counties would pay health, welfare costs and education would be affected.

Responding to Gov. Pete Wilson’s request for suggestions to resolve California’s $12.6-billion budget deficit, Senate Republican Leader Ken Maddy on Tuesday unveiled a plan that would radically alter state government but is considered at best a political long shot.

Among other things, the Maddy solution would drop state health and welfare financing problems on counties, encourage parents to move children from public to private schools, make teacher pay uniform throughout the state, and perhaps end free rides on school buses.

Maddy had a hard time keeping a straight face while outlining the proposal to reporters because parts of it were so extreme. But the plan seemed to be the best the Republican leader and his staff could come up with to close the budget gap.

If anything, the proposal shows just how hard it is for legislators to come up with a combination of cuts and tax increases totaling $12.6 billion.

Maddy outlined $10.8 billion in spending reductions and other money-saving measures and another $1.8 billion in state tax increases to come up with the $12.6 billion needed to cancel the deficit. He proposed an additional $2.8 billion in local taxes to pay for health and welfare programs if they were shifted to counties.

The Republican leader conceded that most of the proposals would encounter political opposition and chose to describe them as talking points that he hopes will prod further budget talks among legislative leaders. But Maddy said, “I stand behind most of (the proposals).”

Wilson has introduced a budget plan that would increase motor vehicle license fees, boost taxes on liquor, beer and wine and extend the sales tax to candy, snack food, newspapers and magazines. The governor also proposed about $5 billion in spending reductions and a variety of other budget moves. Among them are a $2-billion cut in state money scheduled to go to public schools and community colleges and a switch in accounting procedures that he contends will save $800 million during the budget year that begins June 30.

Maddy incorporated many of Wilson’s budget proposals in his own plan. He basically agrees with the governor on the tax increases and favors most of Wilson’s budget-cutting moves.

But he goes further than Wilson in many areas.

He envisions an additional $400 million in cuts to public school and community college programs over the governor’s $2 billion.

Maddy also proposed a 10% across-the-board cut in state operations.

Some of his more extreme proposals would hit schools. Many of them have been recommended by various office holders in the past, but rarely have they been combined in one proposal.

In return for his support for tax increases, Maddy said he wants teacher salaries set on a statewide basis, rather than on a school district-by-district basis. One aide said that if teacher salaries were based on a national average, they would face an average $6,000 annual reduction in pay.

Maddy’s plan includes a call for a 25% longer school day, a requirement that kindergarten teachers work a full day, permanent repeal of all mandatory school funding requirements, legislation that would allow districts to charge students to ride school buses and $1,000 “scholarships” that students could use in private schools.

The last is similar to voucher systems that various conservative office holders have proposed, with no success. “We don’t use that word,” Maddy said in response to a question about vouchers. “We call them scholarships.”

Assemblywoman Delaine Eastin (D-Union City), chairwoman of the Assembly Education Committee, said Maddy’s plan was “ludicrous” and made sense only if he proposed to offset longer teaching days with comparable pay increases.

“If teachers work a 25% longer day, then they deserve a 25% pay raise. They are not indentured servants,” she said.

Maddy, in addition to proposing the wholesale shift of state health and welfare programs to counties, said the intent was to move programs, along with the responsibility for them, closer to the people they are meant to serve. He said the shift of programs would be accompanied by more freedom for counties to raise taxes.

Noting that one Republican legislator has warned that such a plan would result in a patchwork of programs and tax rates from county to county, Maddy said: “I think our caucus is prepared to say yes to that in lieu of continuing as we have with these things as state-mandated and state-finance programs.”