A disappointing sequel

Despite the letter of the law, the true deadline for adopting an annual budget for California falls in the middle of July, when lawmakers are scheduled to go home for a month. No budget means no vacation and, instead, long summer days haggling in sweltering Sacramento. Maybe the state Capitol should move to Trona; it might make them work faster.

The Legislature is required by law -- in other words, gently requested -- to adopt a budget by June 15 so the governor can sign it before it takes effect July 1. Otherwise, the fiscal year is in limbo, and no one gets paid. But our elected representatives have thumbed their noses at the deadlines for so long that state employees have made a ritual out of their annual July trek to the credit union for no-interest loans to tide them over. For those who aren’t on the state payroll but merely live, work, raise families and pay taxes here, the yearly budget bumble is of barely passing interest.

Or is it? The Legislature blew its deadline last year too, but for the first time in six years still managed to get the plan to the governor to be signed on time. That seemingly minor feat moved Californians, already enjoying an economic expansion, to begin believing their government was doing something right. Polls showed that residents saw their state moving in the right direction. With confidence in Sacramento, voters were prepared to sign on to bond measures that promised to build for the future: roads, schools, housing, water projects.

They also were prepared to reelect Gov. Arnold Schwarzenegger, who took the cue and recast himself as a can-do centrist who cuts through partisanship to deliver environmental leadership and responsible growth. He and Republican lawmakers saw in the new vein of goodwill a chance to depoliticize the districting process. Democrats thought they might be able to coax happier voters into rejiggering term limits. Both moves would tap into California’s inherent centrism and improve governmental performance, which could in turn enhance voter faith, leading to an upward spiral of progress not seen in this state in a generation.

Yet last year was easy because the housing boom and oddities such as the sale of shares by the founders of Google produced billions of dollars in unanticipated tax revenue. The real test of Sacramento’s hold on Californians’ confidence comes in a year like this one, with steady growth but no revenue windfall.

With Schwarzenegger and the Democrats in general agreement, it is easy to blame the Republican minority for spoiling the party with their demands for deep spending cuts. But they appeared -- at first -- to simply be heeding the call for fiscal responsibility that first swept Schwarzenegger into office.

It turns out that what they heeded instead was the movie star’s other siren call to voters during the Gray Davis recall: Californians should be taxed less. Assembly Republicans have turned that notion into surprise tax credits for movie studios and other industries. Their Democratic counterparts signed on, with a wink: They say the credits won’t make the final cut. In the meantime, the gift puts a fiscally responsible budget further out of reach, not closer.

The voters’ new and hard-won confidence in their leaders in Sacramento is now at risk, because the budget makes last year’s victories appear hollow. Californians were presented a 2006 ballot measure to preserve gasoline sales tax revenue for transportation projects, along with a massive $19.9-billion bond to build highways and other transit infrastructure. In a display of faith, voters overwhelmingly endorsed both.

Yet lawmakers have hammered out a deal to balance this year’s overdue state budget on those very same tax revenues that were supposed to be out of their clutches. And what about the projects those taxes were going to fund? Forget it. Look elsewhere to pay for light rail to Santa Monica, a fix for the Santa Ana Freeway bottleneck and completed carpool lanes on the I-10.

If those projects are simply backfilled with the transportation bond money, all voters really did last year is borrow nearly $20 billion to make the next several years’ worth of budgets look like they balance, while tax credits are distributed to favored industries. That’s not a state government on the right track. That’s movie magic.