In State Capitol, Moderation Is the Watchword

Tax money flowed. Democrats controlled. And term limits became an entrenched part of the fabric of Capitol life.

The two-year legislative session that came to a chaotic end early Friday saw major boosts in school spending, expansion of social programs, more laws for unions, new gun controls and increased environmental protection.

“We’re at the table, rather than on the menu,” V. John White, who lobbies on environmental issues, said, referring to his struggles with the Republican administrations of Pete Wilson and George Deukmejian.

With a budget surplus this year of $13 billion, Gov. Gray Davis and the Legislature boosted spending on transportation by more than $5 billion spread over coming years, raised public school spending by more than $4 billion and cut entrance fees to state parks in half. Last week, they agreed to boost the Cal Grant program, ensuring college aid for all low- and moderate-income high school graduates with good grades.

In many ways, however, changes in the past two years have been incremental. They’ve been significantly less than many Democrats hoped to get from a government in their party’s hands for the first time since the early 1980s. And the changes have been far less drastic than business interests had feared.

“America and California,” said Phil Isenberg, a lobbyist who spent two decades in the Legislature, “[are] going through a long period of moderation in temperance and tone, and the governor and Legislature are doing the same thing.”

Take, for example, a bill approved Thursday--one of hundreds enacted in marathon sessions last week--to boost benefits for injured workers. California ranks 49th among the 50 states in what it pays most injured workers, and the state has not raised benefits in years.

Pushed by the California Labor Federation, Democratic lawmakers approved an annual boost in workers’ compensation benefits amounting to at least $1.5 billion, raising the maximum check to $651 a week from the current $490.

Organized labor proved that it had the sway to push the bill through the Democratic-controlled Legislature, over the objections of business lobbyists. Davis won election in 1998 with significant union help and still takes labor concerns into account. But as governor, he also pays heed to business groups, in this case the California Chamber of Commerce and insurance companies that provide workers’ compensation.

“I would be surprised if it’s not vetoed,” said state Chamber of Commerce lobbyist Fred Main. Even the bill’s author, Sen. Patrick Johnston (D-Stockton), anticipates a veto.

Davis’ moderate style affects all politics in Sacramento. The Democratic governor has clashed, not with Republicans, but with liberals, particularly Senate President Pro Tem John Burton (D-San Francisco), a veteran of 30 years in politics who is now the state’s most influential legislator.

Last year, lawmakers were insulted when Davis said in a newspaper interview that they should “implement my vision.”

Burton says the honeymoon with the governor ended early last year, and he saw no improvement this year. Indeed, with some exceptions, Democrats appeared more willing to send the governor bills he is likely to veto.

“If Davis wants to maintain that reputation [as a moderate], he is going to have to pull out the veto pen,” said Senate Minority Leader Jim Brulte, a Republican from Rancho Cucamonga.

Dust-ups aside, the first two-year session in 16 years in which Democrats controlled the government shows many notable developments, among them:

* Public school spending fared especially well. Davis ran on an education platform and says voters should judge his success on whether student performance improves. Test scores have risen. Teachers have won big, with salary increases and a special tax break approved earlier this year, and a sweetened package of retirement benefits last week.

* Several gun control bills became law, most of them last year. In particular, Davis signed into law a measure aimed at restricting military-style semiautomatic assault weapons and limiting the clips to 10 bullets. Then, after signing gun control bills last year, he asked for a moratorium on gun control legislation.

When the Senate approved legislation to license handguns last week, the governor persuaded the author, Assemblyman Jack Scott (D-Altadena), to drop it, thereby sparing Davis the embarrassment of vetoing it.

* Native Americans, enriched by huge casino profits, emerged as major players in Sacramento. Their most significant victory came a year ago, when Davis agreed to grant them a monopoly to operate Nevada-style casinos in California. Voters ratified the deal in March.

After their expenditure of more than $100 million on various campaigns since 1998, Indians’ influence is being felt throughout state government. Bond measures drafted by Davis and legislators contained provisions allowing tribes to apply like other governments for a share of the $4 billion in bonds that voters approved in various proposals on the March ballot.

Last week, San Diego-area tribes lobbied successfully for legislation barring a dump near a mountain they view as sacred. The landfill’s developers say the Indians don’t want the dump because it might infringe on nearby casino operations.

* Davis has made strides toward solving California’s persistent water problems, working out agreements with the Clinton administration, farmers, urban interests and environmentalists on the massive water reliability and river restoration program called CalFed.

There was, however, a setback last week, when the Legislature failed to free $135 million, already earmarked in the state budget, for the next installment payment on the program, which will cost $8.6 billion during the next seven years.

“It will not destroy the basic framework of CalFed,” said state Resources Secretary Mary Nichols. “But how quickly we’ll be able to move toward implementation will be affected by what happened.”

* Assembly Speaker Bob Hertzberg (D-Sherman Oaks) enhanced his position and the lower house’s standing by orchestrating hearings to investigate Insurance Commissioner Chuck Quackenbush for his mishandling of Northridge earthquake claims. The one-time Republican star resigned in July.

Limited to three two-year terms, Hertzberg must give up the speakership by 2002, when he must leave the lower house.

“In the Assembly, you really notice the effect of term limits,” said lobbyist White. “As soon as people get good at their jobs, they have to leave.”

* The power of plaintiffs’ lawyers, some of the Democrats’ most loyal donors, has grown, but not as much as some business groups expected. Davis signed legislation giving patients the right to sue HMOs last year. But when he signed a measure that would have made it easier for consumers to sue insurance companies, the industry responded by spending almost $50 million on a ballot initiative that passed in March overturning the measure.

Los Angeles attorney Bruce Broilett, incoming president of the California trial lawyers association, finds fault with Davis. He wishes the governor would push to lift a $250,000 cap on medical malpractice lawsuits that has been in place since 1976. Still, under Wilson, he said, “there was no dialogue.”

“Our experience,” Broilett said of Wilson, “was that he had no interest in even hearing the consumer side. Now, at least we feel we can be heard.”

* Budget surpluses have made governing much easier. The surplus hit $13 billion this year. That, coupled with the generosity of voters, who have approved more than $11 billion in bond measures for schools and the environment since 1998, allowed Davis and the Legislature to earmark billions more for education, transportation, water projects and park expansion.

The budget has soared from the final $75.4 billion spending plan that Wilson signed into law in August 1998 to the $99.4-billion one Davis signed June 30. With more than enough money to go around, summer budget negotiations have become mere tussles compared with the wars that raged during the recession.

Throughout most of the 1990s, Wilson and Democratic legislators were forced to cut or cap spending, resulting in gridlock. In all but one year during Wilson’s eight-year tenure, he signed budgets weeks or months past the legal deadline.

Tax cuts lately have become an annual event. Because of the recession and a $14-billion budget gap, Wilson was compelled to raise taxes by more than $5 billion in 1991, his first year in office. With multibillion-dollar surpluses in each of his first two years, Davis has presided over back-to-back tax cuts amounting to more than $2 billion, largely by accelerating a car tax cut granted by Wilson in his last year in office.