Perata drops bid to recall senator

The Democratic leader of the state Senate said Wednesday he is dropping his campaign to recall Republican state Sen. Jeff Denham, after GOP leaders warned that the effort was a stumbling block to bipartisan negotiations on the state budget.

Senate President Pro Tem Don Perata (D-Oakland) held a news conference on the Capitol steps to say he would no longer promote the recall, although it will remain on the June 3 ballot and groups tied to Perata have spent more than $500,000 urging voters to toss Denham out of office.

Perata said he conveyed his decision to Senate Minority Leader Dave Cogdill (R-Modesto), who had told him the recall effort was an obstacle.

“It would seem to me to be destructive to continue the recall while at the same time he and I were going to sit down with our counterparts in the Assembly and in seven weeks try to put together a budget that may well have to eliminate a $14-billion deficit,” Perata said.

The Democratic leader said his decision was influenced by predictions this week from the state treasurer and controller that the state will have cash flow problems if the Legislature does not come up with a fix for the budget shortfall.

“We are in one of the largest economies in the world and we are teetering on bankruptcy. And if we can’t get our act together we’re going to look like a bunch of clowns,” Perata said, noting this is his last year as senator. “I don’t want to go out in Chapter 7” bankruptcy.

Cogdill applauded Perata’s decision.

“This eliminates an unnecessary distraction in an already contentious budget year,” Cogdill said. “This will allow us to focus on doing what voters expect from us: achieving a balanced, responsible budget.”

Tom Dressler, a spokesman for Treasurer Bill Lockyer, said the state needs a budget close to the July 1 start of the new fiscal year because it does not have a lot of cash reserves to keep paying bills after that.

Denham said he was relieved by Perata’s announcement and is willing to work with Perata on budget reform. But he remained generally opposed to increasing taxes and said he would continue to campaign against the recall to ensure its defeat.

“It certainly comes as good news,” Denham said. “But he still has signs up in my district, ads on the air and money in the bank, so I will continue the campaign.”

Perata said the television ads accusing Denham of lavish traveling and neglecting the state would immediately be stopped.

Denham called the recall effort an “abuse of power.”

A resident of the Central Valley community of Atwater, he angered Perata last year when he refused to vote for a state budget that he felt was not balanced.

A political committee run by Perata’s top political advisor began hiring petition circulators, who collected enough signatures last year to put the recall measure on the ballot.

Perata said in a recent interview that he did not want a repeat this year of the turmoil that marked budget negotiations last year, when a spending plan was delayed more than two months.

Monterey County Supervisor Simon Salinas, a Democrat, is on the ballot to replace Denham if he is recalled.

The Senate president lashed out at Republican Gov. Arnold Schwarzenegger on Wednesday, saying the two have not talked for six weeks and that the governor expects legislators to solve the budget mess.

“This governor has borrowed, begged and stolen every dollar he could find not to raise taxes over the last four years, so we are deeply in debt,” Perata said.

Aaron McLear, a spokesman for the governor, who opposes the recall, countered Perata’s criticism.

“Sen. Perata’s eagerness to raise taxes has been well-documented, but the governor simply disagrees,” McLear said in an e-mail.

Perata’s decision comes a week after Denham broke ranks with other Republicans and voted for a Perata bill providing steps to prevent homeowners from going into foreclosure.

Perata said there was no quid pro quo with Republicans in his decision to drop the recall.

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patrick.mcgreevy@latimes .com