Wilson Has That Boxed-In Feeling

Gov. Pete Wilson is a besieged man these days--besieged by sheriffs, prosecutors, supervisors and mayors, legislators both liberal and conservative and an unsympathetic public he says is misinformed.

Hardly anybody--around courthouses, in the Capitol or on street corners--understands the tight fix he and the state treasury are in, the governor laments. But no matter, “I’m not going to be blackmailed” by the threat of another disastrous summer of stalemate into signing an irresponsible budget, he says. “I mean, there are limits.”

And he has about reached his own limit of budget compromising, Wilson insists. “Well, possibly” there is some negotiating room, he concedes, but “there are very limited options here. And the fact people haven’t focused on them doesn’t change that fact.”

I talked to the governor late last week after he had been hounded for days by local officials protesting his proposed transfer of $2.6 billion in property taxes away from their jurisdictions and into the coffers of schools. He clearly was frustrated.

He already had agreed to extend for six months a half-cent sales tax scheduled to expire on June 30, with the entire $750 million going to local law enforcement. He had called a special statewide election for November to permit counties to raise their own sales taxes. And he was asking the Legislature to relieve local governments of some costly state mandates. But still local officials were complaining.

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Los Angeles’ new mayor-elect, Richard Riordan, had just led a delegation to the Capitol objecting to the cities’ burden of the property tax shift, a relatively paltry $288 million when stacked against the counties’ $2.1 billion. The city of Los Angeles would lose $75 to $100 million.

Riordan said he detected “flexibility” in Wilson. The governor himself had told reporters, “there are some things happening to change the number” of $2.6 billion. And all through the Capitol--among legislators, journalists and gubernatorial aides--Wilson was seen to be in an uncommon mood of compromise, bent on avoiding another gridlocked summer as the July 1 budget deadline approached.

But I found him, rather than flexible, to be rigid on the big-ticket items that Democratic legislators want to negotiate: the amount of property tax shift, the length of sales tax extension and duration of deficit financing.

Told that there aren’t enough votes in the Legislature to approve his $2.6-billion property tax shift, Wilson confidently predicted: “There will be in time.” Why? “Because realistically there is no alternative.” And if there aren’t the votes? “Then we’ll be here for a long time. The fact that they don’t like what they have to do doesn’t alter the fact that it’s what has to be done in order for us to get a budget.”

By Wilson’s reasoning, the net impact on local governments of the property tax shift really would be $1.85 billion if they received the $750 million in additional sales tax revenue he has proposed. Add another $500 million in mandate relief for counties--a figure he suggested over the weekend--and the net impact gets down to the maximum $1.3-billion property tax transfer that many legislators are demanding. And that is what he meant by “changing the number” $2.6 billion.

But the state needs to give schools the full $2.6 billion in local property taxes because Proposition 98, which voters approved, requires that funding level and Sacramento doesn’t have the money. Actually, Wilson and the Legislature must close a $9-billion gap between revenues and spending before they can balance a new $50-plus-billion budget.

“Look, your alternatives are tax increases, which can’t pass--and shouldn’t--and spending cuts,” he said. “I know that I’m not going to sign a tax increase, other than (the half-year extension).”

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So Wilson rejects extending the half-cent sales tax for another year or more, as many Democrats would like. “There aren’t the (Republican) votes,” he noted, adding--in more of a challenge than an invitation--”Try and get it. Let ‘em put it on my desk.”

And he replied with a flat “no” to the idea of rolling over the budget deficit for two years, rather than the 18 months he has proposed. “The only reason to do (18 months) is to avoid some very unpleasant spending cuts in health care.”

He did not flatly say no to “triggers”--the concept of designating cuts that automatically would be triggered if revenues fell to a certain level. But he noted they’re “very difficult to do mechanically.”

Wilson’s back is up as he is being besieged. He’s in a corner and feels he has little room to move. And whether there’s another summer gridlock “is entirely up to the Legislature,” he said resolutely. “They can stay here all summer. I’m not. I’m hitting the road”--to “inform” the public.