Davis Blames Budget Cuts on GOP Legislators

Acknowledging Thursday that he will propose budget cuts next week when he releases his revised spending plan, Gov. Gray Davis blamed Republicans for the reductions in proposed government services.

In an especially partisan attack, the Democratic governor lashed out at Republican legislators for refusing to support legislation authorizing the state to sell as much as $13.4 billion in bonds to pay for power purchases.

Part of the money would be used to replenish the more than $6 billion in general tax money the state already has spent on such purchases.

Davis issued his attack on the Republicans as he signed the bond measure Thursday. That bond passed the Legislature a day earlier, but failed, because of Republican opposition, to win the two-thirds support that would have allowed Treasurer Phil Angelides to market the bonds immediately.

Davis called the GOP decision to oppose the bond legislation “inexplicable.” As a result, the bonds will not be marketed until at least August.

“We’re going to have to pare back important programs in our budget since we won’t have the cash on July 1,” when the new budget must be in place, Davis said.

Davis warned that he may stump in “every district occupied by a member who voted against [the bond bill] to make the case for why this measure is necessary.”

“By refusing to vote for this measure,” Davis said, “Republicans are playing with fire. They should know that their constituents may well be hurt if, as a result of their actions, cuts have to be made in law enforcement, transportation, health care, education and programs for seniors.”

Assembly Republican Leader Dave Cox responded to what his office described as Davis’ anti-Republican tirade by noting that his party’s proposal for a smaller, $8-billion bond was ignored by the Democrats.

“This $13.4-billion bond is a dangerous gamble for California--a gamble Republicans couldn’t support without a clear endgame,” Cox said in a statement. “The governor obviously believes that history will judge that his was the right decision. He had better be right.”

Although Davis blamed Republican opposition to the bond measure for the coming budget cuts, the state’s nonpartisan legislative analyst, Elizabeth Hill, said Wednesday that the state’s slowing economy was going to force some cuts to balance the budget.

According to Hill, California will head into the red unless the governor whittles the $104.7-billion spending plan he released in January.

The state’s budget surplus, which was estimated in January at $8 billion over this fiscal year and next, has shrunk by $3.4 billion, according to Hill, due to a decline in income, sales and corporate tax receipts.

Democratic legislators have indicated that spending on transportation, health care and even Sacramento’s sacred cow, education, may need to be diminished.

One potential candidate for the chopping block is a $201.5-million expansion of the Healthy Families program, which provides health insurance for low-income Californians.

Davis proposed expanding the program in his January budget. If that expansion were enacted, it would cover thousands of working parents of children either enrolled in Healthy Families or, in certain cases, Medi-Cal. Davis’ budget estimated that 174,000 low-income, uninsured adults would participate in the program by June 30, 2002.

But Senate Budget Committee Chairman Steve Peace (D-El Cajon) has said that a full expansion could be tough to pull off given the state’s failing fiscal health.

On Thursday, health care activists expressed concern.

“Health insurance is so important,” said Anne-Marie Flores of the Pacific Institute for Community Organization, which has pushed for parental coverage. “They’re probably trying to leave money in the budget for education, but in order to have a good education you have to be healthy.”

Legislators could decide temporarily to shift about $1.7 billion spread across three transportation accounts and put the money into other priorities, but that could delay some of the transportation projects.

The bulk of that money--about $1.2 billion--is sitting in the state’s so-called Traffic Congestion Relief Fund, which tunnels money to a vast plan enacted by Davis last year to relieve urban California’s gridlocked transportation system.

About three-fourths of the money in the fund has already been earmarked for dozens of projects. They range from $15 million to add a carpool lane through the Sepulveda Pass to $1.9 million to add carpool lanes on the Garden Grove Freeway.

Caltrans spokesman Dennis Trujillo said Thursday that the transportation plan is not at risk and that his department is moving forward with the much-needed projects.

Other vulnerable proposals include $250 million set aside by Davis for cities and counties.

Los Angeles City Controller Rick Tuttle, who pegged Los Angeles’ share at $19 million, said the city’s $3.2-billion budget that is being drafted now does not include the money. If the city receives the money, Tuttle said, it could be used to hire more paramedics, recruit police and extend library hours. If the money does not come through, those priorities would go without additional cash.

Republican legislators say there is an easy way to deal with the state’s tighter financial outlook: Stop increasing the size of state government.

GOP legislators had called in December for $3.2 billion in tax cuts, but Assembly Republicans switched gears this week by proposing that a sizable budget reserve be established to protect consumers from unpredictable energy costs. They contend that a 5% reserve would amount to more than $4 billion.

Assembly Republicans also are putting together a list of possible trims that are expected to total up to $3 billion.

“We’re not looking for wholesale cuts,” said Assemblyman George Runner, the Lancaster Republican who serves as vice chairman of the Assembly Budget Committee. “But this certainly is not the time that government should be growing.”