Political Ploys Go On, With Budget Deal Still Out of Reach

Political gamesmanship continued in the Capitol on Friday as Assembly Democrats tried to hoist Republicans with their own petard by positioning them to reject even their own version of a state budget.

That plan, based on a GOP proposal never written into bill form, did not include the new taxes that Republicans so oppose and would have dramatically reduced state services that Democrats so want to protect.

Democrats argued that Republicans never intended to vote for the plan because the cuts in education and health care needed to make it work would trigger a voter backlash. They said it is a Republican ruse to avoid appearing obstructionist while rejecting tax hikes to close a $38-billion shortfall.

But Republican Assembly members said the bill that Democrats put up for a vote Friday distorted their proposal, and they refused to vote on it.

“This budget is not our budget,” said Assembly Budget Committee Vice Chairman John Campbell (R-Irvine), adding that the GOP staff had found a dozen places where the bill was different from the party’s plan in just the few hours they had to review it.

The bill got zero “yes” votes, and with less than four days left before the deadline for lawmakers to approve a budget, both houses of the Legislature were adjourned and members went home for the weekend.

State Controller Steve Westly warned this week that roughly $1.5 billion in monthly payments to local schools, colleges, universities, transportation projects and businesses that have contracts with the state will stop flowing after July 1 if no budget is in place.

Education officials warned that a prolonged halt in funding would cause them severe problems; they implored lawmakers to pass a budget on time.

Yet legislators remained at an impasse. Democrats said that trying to balance the budget without an increase of at least a half cent in the sales tax would require cutbacks too severe for Californians to bear. Republicans said they would stand firm on their promise not to provide the eight GOP votes required for taxes to be raised. In California, lawmakers cannot raise taxes without a two-thirds majority vote.

“Any amendments you want to make, put them in the doggone bill and we will debate them,” Assembly Speaker Herb J. Wesson Jr. (D-Culver City) said of the proposal voted on Friday.

Republicans accepted the challenge to put the bill into a form that accurately reflects their plan, but balked when Democrats called on them to have it ready by Monday’s midnight deadline for passing a budget. They said that could take a week or longer.

Democrats, meanwhile, lined up to vote in favor of their own proposal on Friday, which includes nearly $9 billion in new taxes on cars, sales and the incomes of high earners. It also includes more than $600 million in cuts to local government, a reduction in payments to doctors who treat Medi-Cal recipients and the borrowing of $1.8 billion against payments owed to the state from tobacco companies.

The bill was defeated on a straight party line vote.

“We ought to change the name of this state from California to Taxifornia,” said Assembly Republican Leader Dave Cox of Fair Oaks. “You cannot in fact solve this problem with a tax increase. You must make serious reductions.”

A frustrated Wesson disputed claims that Democrats single-handedly drove spending to its current level. He said most of the investments in schools and health care programs over the last few years were supported by Republicans.

“Don’t accuse us of spending willy-nilly, because you took the trip with us,” he said. “It takes two to dance, and you danced with us.”

Democrats in the Senate made the same argument on Tuesday and Wednesday as Republicans rejected their plan, which included the sales tax and the car tax.

Many Democrats warned of the consequences of the Republican approach.

Assemblywoman Jackie Goldberg (D-Los Angeles) called the Republican proposal a “politically motivated death march that will lead to bankruptcy.”

The linchpin of both the Democratic and Republican plans is borrowing more than $10 billion to roll the current year deficit over into the next five years. Several of the large banks that would be positioned to lend the state the money have warned that they would be reluctant to do so without at least a half cent sales tax to back the borrowing.

Republicans accuse those banks of doing the bidding of the Democrats and say they are confident the banks would lend the money without a new tax if that were the only option given them.

The plan Republicans first released in late April includes major cutbacks in health care and aid to public universities. The University of California and California State University systems, for example, would be cut by more than $600 million a year. Democrats say cutting that much from public universities would take the equivalent of shutting down UC Berkeley.