Gov.-Elect Rolls Up His Sleeves on Budget

Gov.-elect Arnold Schwarzenegger travels to Sacramento today to meet with legislators and raise the prospect of calling a special session to deal with California’s troubled state budget.

Over the next two days, Schwarzenegger is scheduled to meet with Gov. Gray Davis, top party leaders in the Assembly and Senate, and all the statewide elected officials in a series of 20-minute encounters that his advisors have billed as “get-to-know-you” sessions.

The meetings come on the heels of a fresh warning Tuesday from Treasurer Phil Angelides that the state’s financial problems could soon grow even worse.

The round of private meetings will constitute the incoming governor’s most substantial actions since his decisive election Oct. 7, and the reaction to the sessions is expected to be parsed for signals of how the movie star will make the transition into his new role.

“The governor will be extending a hand to Democrats and Republicans alike to ensure that he’s got a good working relationship here in Sacramento,” said Schwarzenegger spokeswoman Karen Hanretty.

Assembly Speaker Herb Wesson (D-Culver City) said he hopes to have a “very good personal relationship” with the new governor and vowed to create a climate in which the largely Democratic Assembly can work in a bipartisan fashion with Schwarzenegger.

“I’m not going to let you or anybody else put me at odds with Mr. Schwarzenegger,” he told reporters Tuesday at his annual barbecue for the Capitol press corps.

“I believe that if you took 10 items, that Schwarzenegger and I would agree on 7 1/2,” Wesson added. “You build your relationship based on the things that you agree on. The things you disagree on, once that relationship is built, then I think you can have an open and candid debate.”

Other Democratic lawmakers were less effusive. Senate President Pro Tem John Burton (D-San Francisco) politely commended Schwarzenegger for making the rounds, but cast his meeting with the incoming governor as a simple meet-and-greet.

“I don’t think we’ll resolve the budget problem,” he said dryly.

Coping with a looming budget shortfall will be Schwarzenegger’s most immediate task, complicated by his pledge to immediately repeal a recent $4-billion increase in the vehicle license fee.

On top of that, Angelides warned Tuesday that the incoming governor must quickly devise a backup plan in case the courts strike down a $13-billion bond package that the state used to balance this year’s budget.

Beyond those matters, the new governor has laid out an ambitious agenda for his first 100 days in office, pledging a wide range of actions on everything from renegotiating contracts with state unions to changing state fund-raising laws.

Schwarzenegger has already brought in Donna Arduin, a veteran budget director on loan from Florida’s finance office, to “audit” California’s books, a task she said would be completed by the time Schwarzenegger has to submit his new budget in early January.

In his meetings with lawmakers, the governor-elect plans to discuss scheduling a special session of the Legislature to go over the budget, his advisors said.

Schwarzenegger has already suggested that he might seek ways to refinance some of the state’s debt -- if not by action of the Legislature then by seeking a voter initiative.

A special session would enable the Legislature to fashion a plan that would become law within a short period of time. For example, measures approved by a two-thirds vote take effect immediately.

Some legislators warned that such a session will not ensure a solution to the state’s financial problems.

“It’s easy to schedule,” Burton said. “You say, ‘Everybody be here next Tuesday at 1 o’clock.’ What comes out of it is something else.”

Schwarzenegger is slated to sit down with Davis on Thursday morning, just a little over two weeks after the two men were exchanging harsh rhetoric on the campaign trail.

Davis spokesman Steven Maviglio said the outgoing governor had a similar chat with former Gov. Pete Wilson before the latter left office, an encounter he said Davis found extremely useful. Davis plans to discuss matters such as the role of staff and the demands of the job with his successor, he added.

“There are certain things that only people who have been governor know and can talk about,” Maviglio said. “The former governors’ club is fairly small.”

Over the next two days, the governor-elect intends to meet with each statewide officeholder, including Lt. Gov. Cruz Bustamante, who placed second in the race to replace Davis. Schwarzenegger’s wife, Maria Shriver, already has called Bustamante’s wife, Arcelia.

Schwarzenegger will also be meeting with a joint caucus of Assembly and Senate Republicans, a sign of the increased importance GOP lawmakers will likely have in Sacramento.

Even though Democrats firmly control both houses of the Legislature, Republican legislators now will have an ally in the governor’s office, which will give them leverage in policy-making and passing bills, political analysts said.

“They are going to be much bigger players in Sacramento,” said Tony Quinn, co-editor of the nonpartisan California Target Book, which analyzes legislative and congressional campaigns. “The dynamic changes considerably.”

A pool of reporters will be given brief glimpses of Schwarzenegger’s sessions with Davis and legislative leaders, but the governor-elect is not scheduled to hold a news conference during his two-day swing through Sacramento.

Still, Schwarzenegger’s trip to Sacramento will be his most visible move since he met with President Bush last week. For the most part, he has been closeted with advisors, sifting through resumes from those applying to work in the new administration.

He took a break over the weekend to spend time with his family at its vacation home in Sun Valley, Idaho.

On Tuesday, Schwarzenegger met for about 45 minutes with Luis Ernesto Derbez, Mexico’s secretary of foreign affairs, who stopped in Los Angeles to introduce himself to the governor-elect on his way back from an economic conference in Bangkok.

The two men discussed the relationship between California and Mexico, and Derbez designated Martha I. Lara, Mexico’s consul general in Los Angeles, to serve as a liaison with the new administration.

“It was a very good meeting,” said Allan Nahum, spokesman for Mexico’s Ministry of Foreign Affairs. “The important thing is that we have this first meeting and that both sides want to work together.”

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Times staff writers Dan Morain and Nancy Vogel contributed to this report.