Lawmaker Offers Rival Budget : Spending: Assemblyman Vasconcellos seeks to spread property tax shift over two years, sacrificing some traditional Democratic programs. Wilson spokesman says proposal is unacceptable.

Offering the first comprehensive, balanced alternative to Gov. Pete Wilson’s budget proposal, a leading Democratic assemblyman advanced a multi-year plan Tuesday that would keep the sales tax at its current level to retire the state’s recurring deficit.

The sweeping plan by Assemblyman John Vasconcellos of Santa Clara, the Assembly Democrats’ top budget writer, would also soften the blow to local governments--and law enforcement--by spreading a $2.6-billion property tax transfer over two years that Wilson wants to accomplish in one year.

Finally, it would forgive loans to public education that Wilson and the Legislature imposed a year ago. If left in place, the loans all but guarantee that funding for primary and secondary schools will fall well behind the rate of inflation over the next several years.

Despite these differences with the Republican governor’s plan, the proposal still sacrifices some of the Democrats’ normally sacred cows. It calls for cuts in welfare grants, reductions in aid to the aged, blind and disabled, and the repeal of the renters’ tax credit for low-income tenants.

Unlike many previous Democratic plans, this one does not rely on accounting maneuvers, one-time shifts or rosy assumptions to come out balanced. To guarantee the end of the state’s continuing deficits, Vasconcellos endorses the idea of automatic triggers to cut spending if revenues fall short of projections.

“It’s not a pretty picture,” said Vasconcellos, longtime chairman of the Assembly Ways and Means Committee, as he unveiled his plan to Capitol reporters. “But it’s better than going under.”

Wilson’s chief spokesman, Dan Schnur, said the Vasconcellos plan would not be acceptable to the governor because Wilson does not intend to retreat from his opposition to extending the sales tax. But Schnur said Wilson met with Vasconcellos for 15 minutes Tuesday to discuss the lawmaker’s plan.

“This represents a significant step forward,” Schnur said. “Vasconcellos is proposing reductions in areas he’d obviously prefer not to cut, but he recognizes the necessity of reducing government spending in order to balance the budget. He deserves credit for that.”

Wilson insists that the half-cent addition to the sales tax, enacted as a temporary measure in 1991, be allowed to expire on schedule June 30. If it is kept on the books, as Vasconcellos suggests, the tax would raise an additional $1.4 billion a year for the state.

“That’s the major sticking point,” Vasconcellos said.

Wilson, in a major concession to Democrats, said last week that he would be willing to delay repayment of part of the state’s $3-billion, year-end deficit to reduce the need for deep budget cuts.

Vasconcellos would go further, using the revenue from the extended sales tax to pay off the deficit and forgive about $950 million in loans to the schools, which otherwise would be deducted from future state payments to education.

In that sense, the plan is nearly identical to the outline advanced this week by Treasurer Kathleen Brown, a Democrat who is expected to challenge Wilson in next year’s gubernatorial race. But Vasconcellos, unlike Brown, has provided a complete budget proposal that describes the cuts in services that would be required to balance his spending plan over two years.

The most striking element in the plan probably is a proposal to save the state about $400 million annually by repealing the renters’ tax credit, which gives $60 tax relief or grants to tenants earning less than $20,500 a year. Wilson has tried to eliminate the credit each year of his governorship but has consistently run into Democratic opposition.

The lawmaker also proposed a 2.7% cut in grants to welfare families. Wilson’s plan calls for a 4.2% cut to all welfare recipients and deeper reductions for long-term welfare recipients in families that include an able-bodied adult.

Vasconcellos suggests a 2.7% reduction in aid to the aged, blind and disabled. Wilson advocates a 2.7% cut for the aged or disabled--from $620 to $603 a month--and a 4.5% cut for blind recipients, which would reduce their grant from $689 to $658 monthly.

And although Wilson has proposed tripling community college fees from $10 to $30 a unit, Vasconcellos proposes a 20% increase, to $12.

The Vasconcellos plan also would go easier on local government than Wilson’s budget.

The governor has proposed a $2.6-billion property tax shift that would allow the state to keep school budgets growing, but only at the expense of other local governments. The proposal has prompted sheriffs and district attorneys to complain that Wilson, who carefully cultivates the image of being tough on crime, would force deep cuts in law enforcement budgets.

Vasconcellos endorses the tax transfer but would phase it in over two years. He also proposes to let county supervisors decide for themselves whether to raise the sales tax another half-cent for local programs. Wilson wants county officials to go to the voters for approval of any tax increase.

“I believe you elect people, you elect them to do a job,” Vasconcellos said. “They ought to do it. And they ought to make the best choices. If you don’t like them, get rid of them. That gives them authority, responsibility and accountability. The alternative is paralysis.”

Vasconcellos also endorsed a proposal by the Legislature’s nonpartisan analyst to shift about $1.4 billion in criminal justice programs from the state to local government, along with the money to pay for them.

His goal, Vasconcellos said, is to “empower California’s local governments to become autonomous and responsible, for themselves and to their respective citizenries.”

In addition to his budget proposal, Vasconcellos repeated his call for reforms to improve the state’s business climate, calling for a two-year moratorium on all regulations except those considered critical to health and safety.