Budget Passed by Assembly Meets Stiff Test in Senate : Finances: Opponents say the $52.1-billion plan sacrifices principles to meet a deadline. L.A. lawmakers seek a package of urban aid.

A state budget bill backed by Gov. Pete Wilson and the legislative leadership won approval in the Assembly but stalled in the Senate on Monday night, where rank-and-file members complained that the $52.1-billion spending plan sacrificed principles to meet a deadline.

An intense lobbying effort by Wilson and other supporters of the budget continued into the early morning hours today. In voting shortly after midnight, the Senate remained seven votes shy of the 27 needed for passage.

It was unclear how deeply in trouble the budget bill was because it is a tradition here--evidenced 24 hours earlier in the Assembly--for lawmakers to vote against the budget in hopes that the governor or legislative leaders will make concessions to their interests.

The spending plan makes deep cuts in welfare, bolsters prisons and protects public school funding by shifting $2.6 billion in local government property tax revenues to schools. The plan hits Los Angeles County particularly hard, and at day’s end, Los Angeles lawmakers were working on an urban aid package to assist the city and county.

The pressure in the Senate to vote for the budget, any budget, was especially intense Monday because the Assembly approved the plan in a rush of early morning compromises after an all-night session ending at 4:54 a.m. Monday.

Many lawmakers feared that rejection of the bill in the Legislature’s upper house could trigger another prolonged stalemate similar to last summer’s 63-day deadlock.

“We have our duty,” said Senate President Pro Tem David A. Roberti (D-Van Nuys). “Our duty is to (get) the state of California moving again. Our duty is to pass a budget.”

But some members said they were fed up with the focus on the Legislature’s constitutional deadline for passing a budget--missed a week ago--and the July 1 start of the fiscal year.

“I won’t have a budget shoved down my throat just to meet a deadline,” said Sen. Diane Watson, a Los Angeles Democrat. She said the plan cut too deeply into services for the poor.

Sen. Tom Hayden (D-Santa Monica) said the leadership, in its haste to meet the deadline, had ignored the damage the budget would do to higher education and had failed to consider eliminating business tax breaks to raise more money for the state’s treasury.

“My concept of duty says you fight for your beliefs, and I don’t remember that (fight) having begun,” Hayden said.

But Roberti told the members that the public holds the Legislature in low regard because it cannot follow the law and pass a budget on time.

“Let’s get a life here,” he said repeatedly.

The budget was crafted behind closed doors by Wilson, Roberti, Senate Republican Leader Ken Maddy of Fresno and the Assembly’s Democratic and Republican leaders.

The Assembly approved it early Monday by a bare two-thirds vote, 54-24, after Assembly Speaker Willie Brown (D-San Francisco) raised the possibility that Democratic holdouts risked losing their leadership positions as committee chairs.

Brown told lawmakers that they needed to approve the budget because it was not going to get any better. Even so, he acknowledged that the budget was going to be painful and he made an effort to distance himself from the details.

“It is Pete Wilson’s budget,” a fatigued Brown said as dawn neared. “There is very little in there the Democrats ought to be supporting.”

Yet the Republican Wilson was able to muster only eight of 31 GOP votes in the Assembly, even after a night of intense lobbying.

In the Senate, Republicans and Democrats met privately in party caucuses for most of the afternoon Monday. As he did in the Assembly, Wilson argued for his budget in meetings with Senate Republicans.

“This is the best package that we have available to us,” Maddy said. “It can only get worse.”

Perhaps the most contentious part of the plan would shift $2.6 billion in property taxes from local governments and transfer the money to schools. To make up part of that amount, the budget plan would extend the extra half-cent sales tax for another six months, with the proceeds going to local government.

The plan would ask voters to decide in November whether to make the sales tax hike permanent.

The Assembly needed three votes before Brown and Minority Leader Jim Brulte (R-Rancho Cucamonga) could marshal the required 54 votes.

Brulte said he “wouldn’t read much into” GOP lawmakers’ refusal to embrace the governor’s spending plan. He said the vote reflected a bipartisanship missing from recent budget fights.

“It should signal to all California that the legislators of both parties are willing to compromise to get a budget on time,” Brulte said.

Brown exerted his influence to muster all but one Democrat to support the budget. “I’m shocked that only eight Republicans stepped forward,” Brown said.

Assemblyman John Vasconcellos (D-Santa Clara) was the sole Democrat to vote against the plan. Vasconcellos called the proposal a “stupid and obnoxious” budget that gave too much to police and prisons and not enough to California’s poor. He also said the spending plan placed before the Legislature by the leadership and Wilson failed to solve California’s $2.9-billion deficit.

Vasconcellos, co-chairman of the Assembly-Senate joint committee on the budget, had been working on a legislative version of the budget when the so-called Big Five--Wilson and the Democratic and Republican leaders of the Legislature--took over negotiations.

After hours of meetings with lawmakers and debate on the floor of the lower house, Brown put the budget to a vote for the first time about 11:30 Sunday night. It failed by a vote of 40 to 31, and the arm-twisting was turned up a notch.

Much of the pressure was focused on Los Angeles lawmakers because for most of the night, key members of the Los Angeles delegation held out for a better deal. The delegation was responding to Los Angeles County officials, led by Board of Supervisors Chairman Ed Edelman, who came to the Capitol to kill the deal.

Under the spending plan, Los Angeles County loses $273 million in local property tax revenue--more than half the combined $540 million that the 58 counties will lose. The impact is so large primarily because the county had benefited disproportionately under the bailout of local governments organized in the wake of Proposition 13 property tax cuts.

Finally, early in the morning, Los Angeles County officials and several Los Angeles lawmakers met privately with Brown in his office. Although there was no yelling or table thumping, “the words were coming fast” between Edelman and Brown, said Dist. Atty. Gil Garcetti. The meeting lasted for more than half an hour and broke up at 2:15 a.m.

During the meeting, there was talk of allowing the county to impose a tax on the gross receipts of businesses. But that idea was put on hold because cities have imposed such a tax.

Assemblyman Terry B. Friedman (D-Brentwood) suggested allowing cities and counties to receive some proceeds of a state tax imposed on banks doing business in California. The so-called bank-in-lieu tax could bring up to $180 million to counties and cities statewide, with much of that going to financial centers such as Los Angeles and San Francisco.

Brown agreed to allow the idea to go to the floor for a vote.

“We needed to find something quickly that would have support,” Friedman said. “I’m not about to subject the people of California to another 64-day struggle. We had an obligation to come up with alternatives.”

The meeting broke up, and Brown put the budget to a vote again at 2:20 a.m. Again, the budget failed, this time 39 to 37.

Sounding impatient and angry, Brown recessed the floor session and ordered his Democrats into a private caucus, saying: “Where are my committee chairs?”

The implication was clear: He was calling in favors from Democrats he had rewarded with powerful chairmanships.

“He was expecting the chairmen of the committees to respond,” Assemblyman Richard Polanco (D-Los Angeles) said. “He was saying, ‘This is a critical vote.’ ”

The Los Angeles lawmakers agreed to relent, but only after the bill providing the urban bailout moved to the floor.

The final yes vote was cast by freshman Assemblywoman Debra Bowen (D-Marina del Rey). In the wee hours, she was the focus of intense lobbying by other members, including Assemblyman Richard Katz (D-Sylmar).

“In the end, after three hours of agony, my conclusion was that the risk of that kind of a gridlock again was a worse risk than passing a not-so-terrific budget,” Bowen said.

At a Los Angeles news conference Monday afternoon, Supervisors Chairman Edelman said: “This is a disaster for Los Angeles County. . . . This is not the right time or the right way to cut local government’s sources of revenue.”

The Board of Supervisors is scheduled to begin deliberations on the proposed $13-billion county budget today.

County officials said the funding cuts would force them to close at least one hospital, eliminate mental health services to at least 30,000 patients, close four jails and 23 parks, and lay off 9,500 employees.

Edelman said the legislators caved in to pressure to get the budget done, rather than face more embarrassing delays.

Supervisor Mike Antonovich said the Assembly chose “to take the easy way out, with a power grab, a confiscation of the property tax” that had traditionally belonged to the counties.

But in the Senate, Roberti warned Los Angeles-area lawmakers that they risked getting a worse deal for their county if they voted against the budget and forced it back into a two-house conference committee. He noted that legislators from rural areas complained that the budget favored urban California at their expense.

“Somebody’s guessing wrong,” Roberti said.

Times staff writers Carl Ingram and Frederick Muir contributed to this report.

How They Voted

The 54-24 roll call in which the Assembly on Monday approved a $52.1-billion state budget :

* DEMOCRATS FOR: Dede Alpert of Coronado, Marguerite Archie-Hudson of Los Angeles, Rusty Areias of San Jose, Joe Baca of San Bernardino, Tom Bates of Berkeley, Julie Borenstein of Palm Desert, Debra Bowen of Marina del Rey, Vivien Bronshvag of Kentfield, Valerie Brown of Sonoma, Speaker Willie Brown of San Francisco, John Burton of San Francisco, Cruz Bustamante of Fresno, Louis Caldera of Los Angeles, Robert J. Campbell of Martinez, Sal Cannella of Modesto, Tom Connolly of Lemon Grove, Dominic Cortese of San Jose, Jim Costa of Hanford, Delaine Eastin of Fremont, Bob Epple of Cerritos, Martha Escutia of Huntington Park, Barbara Friedman of North Hollywood, Terry Friedman of Brentwood, Mike Gotch of San Diego, Tom Hannigan of Fairfield, Dan Hauser of Arcata, Phillip Isenberg of Sacramento, Betty Karnette of Long Beach, Richard Katz of Sylmar, Johan Klehs of San Leandro, Barbara Lee of Oakland, Burt Margolin of Los Angeles, Diane Martinez of Rosemead, Juanita McDonald of Carson, Bill Moore of Oceanside, Willard Murray Jr. of Paramount, Grace F. Napolitano of Norwalk, Jack O’Connell of Carpinteria, Steve Peace of Chula Vista, Richard Polanco of Los Angeles, Byron Sher of Palo Alto, Margaret Snyder of Modesto, Hilda Solis of El Monte, Jackie Speier of Burlingame, Curtis Tucker Jr. of Inglewood, Tom Umberg of Garden Grove. TOTAL: 46.

* REPUBLICANS FOR: Jim Brulte of Rancho Cucamonga, Paul Horcher of Diamond Bar, Bill Jones of Fresno, Charles Quackenbush of San Jose, Richard Rainey of Walnut Creek, Bernie Richter of Chico, Stan Statham of Oak Run, Nao Takasugi of Oxnard. TOTAL: 8.

* DEMOCRATS AGAINST: John Vasconcellos of Santa Clara. TOTAL: 1.

* REPUBLICANS AGAINST: Fred Aguiar of Chino, Doris Allen of Cypress, Dean Andal of Stockton, Paula Boland of Granada Hills, Larry Bowler of Elk Grove, Mickey Conroy of Orange, Gil Ferguson of Newport Beach, Robert Frazee of Carlsbad, Jan Goldsmith of Poway, Trice Harvey of Bakersfield, Ray Haynes of Murrieta, Bill Hoge of Pasadena, Kathleen Honeycutt of Hesperia, Ross Johnson of Fullerton, William J. (Pete) Knight of Palmdale, David Knowles of Cameron Park, Bill Morrow of Oceanside, Richard Mountjoy of Arcadia, Pat Nolan of Glendale, Curt Pringle of Garden Grove, Andrea Seastrand of San Luis Obispo, Ted Weggeland of Riverside, Paul Woodruff of Moreno Valley. TOTAL: 23.

Source: Times staff and wire reports

State Budget Watch

Ten days before the end of the fiscal year, the constitutional deadline for enacting a new state budget, there were these key developments in Sacramento:

THE PROBLEM: The state will end the year with a $2.7-billion deficit and faces a $9-billion gap between anticipated tax revenues and the amount needed to pay off the deficit and provide all state services at the current levels for another 12 months.

THE LEGISLATURE: The Assembly passed a $52.1-billion budget and sent it to the Senate, which was took up the spending plan late Monday. The Assembly vote was 54 to 23, with all but one Democrat and only eight of 31 Republicans voting in favor. The Assembly also passed the education budget and a measure to ask statewide voters in a November referendum to make a temporary, half-cent sales tax permanent.

In the Senate, initial voting on the Assembly-passed budget bill fell short of the 27 needed for passage.

GOV. PETE WILSON: Wilson met with Senate Republicans to make his pitch for the budget, which he drafted in meetings with the leaders of both parties in the Assembly and Senate.

KEY DEVELOPMENTS: Negotiations focused on placating Los Angeles County lawmakers, who were concerned that a $2.6-billion property tax shift would hit the state’s largest county harder than any of the others.

Budget Highlights

Here are the highlights of a state budget package for the 1993-94 fiscal year, approved Monday by the Assembly and sent to the Senate.

SPENDING: Spends $38.5 billion from the state’s general fund, down $2.6 billion, or 6.3%, from the fiscal year that ends June 30. Total spending is $52.1 billion, including special funds raised from fees and targeted taxes.

DEFICIT: Delays repayment of $1.1 billion of the state’s $2.7-billion debt in the current year ending June 30. Allows the state to borrow money to finance the debt but requires that the loans be repaid by the end of 1994.

TAXES: Extends for six months a temporary half-cent sales tax that was to expire June 30. Places constitutional amendment on the ballot asking voters whether to make the tax permanent. Suspends the renters tax credit for two years.

LOCAL GOVERNMENT: Shifts $2.6 billion in property tax revenue from cities, counties and special districts to the schools, an amount the state otherwise would be required to pay from its own treasury. Repeals an estimated $500 million in state-ordered local government obligations. Allows counties to seek state waiver from requirement to provide welfare to single, able-bodied adults. Shifts $700 million in sales tax revenue from the state to local government for public safety and $1.4 billion annually if voters make the half-cent sales tax surcharge permanent.

HEALTH AND WELFARE: Adds a net of $168 million, or 1.3%, to this year’s level of spending. Reduces welfare grants and aid to the aged, blind and disabled by 2.7%. Eliminates some dental services for the poor.

KINDERGARTEN THROUGH 12TH GRADE: Reduces spending from $4,208 per student to $4,187 but assumes that cost savings from workers’ compensation and property tax administration fees will allow schools to maintain current level of funding for classroom instruction. Loans schools $608 million to be deducted from future guaranteed state appropriations.

COMMUNITY COLLEGES: Increases fees 50%, from $10 per unit to $15 per unit. Caps fees at $150 per semester, so that full-time students taking 15 units would have no fee increase. Loans community colleges $178 million.

HIGHER EDUCATION: Reduces funding by $17 million, or 0.5%. Assumes fee increases of 22% at University of California and 10% at California State University. Restores cuts in financial aid made last year and adds money to help defray fee increase for low-income students.

PRISONS: Boosts spending by $282 million, or 9% above current year levels.