Spending-cap opponents slow to organize


The last time Gov. Arnold Schwarzenegger asked California’s voters to permanently cap state spending, organized labor dumped millions of dollars into a successful campaign to defeat his proposals.

Four years later, Schwarzenegger and other proponents are hoping the unions will sit out the May 19 special election in which the governor is again asking voters to enact a spending cap. That measure was placed on the ballot by the Legislature as part of last week’s deal to resolve the state’s cash crisis.

The official ballot arguments have been submitted, and in what administration officials hope is an encouraging sign, the best-funded labor groups opted not to weigh in against the measure. At least not yet.


In addition, the state’s major antitax groups have split over the measure, with at least two supporting it even though it would prolong the tax increase that the Legislature passed last week. The California Taxpayers’ Assn. signed the ballot measure backing the spending cap, and Lew Uhler of the National Tax-Limitation Committee said he also favors the measure, called Proposition 1A.

“At this point, it seems to be a reasonable restraint device,” Uhler said in an interview Tuesday.

Jon Coupal, president of the Howard Jarvis Taxpayers Assn., said he was surprised at Uhler’s stance and said his own group would fight to defeat the measure.

“I’m not sure we’ll be able to match the proponents dollar for dollar, but we’ll certainly get the message out,” he said.

If approved by voters, Proposition 1A would prevent lawmakers from spending tax windfalls when California’s economy is good, as they did during the housing and dot-com booms. State financial officials would estimate how much money lawmakers could spend based on revenues received over the previous decade. Any extra money would go into a rainy-day fund to plug unexpected deficits like the one totaling nearly $42 billion that lawmakers fought over for more than three months before passing a new budget last week.

The supporters and opponents on the ballot pamphlets are important, because many voters consider the arguments in deciding how to vote. But lawmakers gave interested parties only a few days to submit arguments, and many of the unions need to meet with their leaders before committing to any political campaign.


The fate of the spending cap, as well as five other propositions that lawmakers voted to place on the ballot, may be determined by whether any well-funded opposition emerges. Unions representing teachers, nurses, firefighters and others defeated Schwarzenegger’s 2005 ballot effort to limit state spending, and they drove down the governor’s public-opinion standing in the process.

This time, the California Teachers Assn. -- which provided much of the money to defeat Schwarzenegger’s 2005 agenda -- is supporting a companion measure, Proposition 1B, that provides extra payments starting in 2011 for schools and community colleges to compensate for cuts lawmakers made last week. David Sanchez, the union’s president, said their board of 800 teachers and school officials would decide next month what position, if any, to take on the spending limit.

The Service Employees International Union, which represents healthcare workers and others and also wields influence in Sacramento, opposed the spending cap when it came before legislators but has not taken a position on the ballot measures.

The California Faculty Assn., which represents workers in the California State University system, is opposing the measure. Along with two consumer groups, it provided the ballot arguments against Proposition 1A.

The groups called the spending cap “a flawed measure filled with fine print and loopholes,” according to a draft submitted to the California secretary of state and scheduled to be made public Thursday.

Lillian Taiz, president of the faculty union, predicted, “I think you’ll see other unions stepping forward.”


She said the cap would prevent lawmakers from substantially replacing the funding they have removed in recent years from the California State University system.

“This cap basically tells us and all of California there’s no way to rebuild or restore or grow to meet the future,” Taiz said.

Schwarzenegger and lawmakers have long sought a spending cap, but Democrats agreed only last week to go along, in order to secure GOP votes to raise taxes. The package of ballot measures was written specifically to blunt unions from opposing it, by giving more money to schools and extending for up to two more years the taxes that lawmakers passed last week. The taxes will expire earlier if the spending cap does not pass.

The argument on the “yes” side for Proposition 1A was submitted by the California Taxpayers’ Assn., California State Sheriffs’ Assn. and Schwarzenegger’s education secretary.

“Prop. 1A will prevent the types of massive budget deficits we faced this year which force crippling cuts to vital services,” their argument says.

“We’re rapidly putting together a broad-based steering committee,” said Rick Clausen, co-manager of the proponents’ campaign.


The “yes” campaign, Budget Reform Now, opened a campaign account Monday. Schwarzenegger held a $2,500-per-person fundraiser for his own campaign fund Monday in Washington, D.C. The invitation listed “fixing the state’s dysfunctional budget system and modernizing our state lottery” as his top priorities this year.



Starting over

Forum urges a constitutional overhaul of state government. PAGE 7