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Dueling tax hike measures pushed as Democrats hold convention

More than 2,000 California Democrats gathered in San Diego this weekend for their state party convention, giving leaders a chance to rally the faithful and rub elbows with powerful, well-heeled interests.

While hundreds of activists listened to Sen. Dianne Feinstein (D-Calif.) give a noontime address Saturday, Gov. Jerry Brown slipped away to a neighboring hotel to host a $25,000-a-plate lunch for a select group of contributors.

The fundraising event, which was closed to the media but had about two dozen guests, according to some who attended, provided an intimate audience with the governor for lobbyists whose clients had opened their wallets to back Brown's proposed tax-increase initiative. The governor's supporters are collecting signatures for a ballot measure that he hopes voters will approve in November.

In his drive to temporarily raise taxes on sales and on incomes above $250,000, Brown has been reaching out to business, tribal and labor leaders who can bankroll a campaign if his measure qualifies for the ballot, which is considered likely. But on Saturday, he seemed unconcerned about building grass-roots support.

Moments before his fundraiser, Brown passed up an opportunity to tout his plan to the crowd in the San Diego Convention Center, where many were waving "We're With Jerry" placards. The governor spoke for about 10 minutes, touching on some familiar themes, including less testing in schools and support for a statewide high-speed rail system. But he made just a passing reference to his initiative, expressing confidence that Democrats would eventually fall into line behind his proposal at the behest of party leaders.

"We've got to pass a tax measure," he told the group. "...You'll get your marching orders soon enough."

But there are divisions among Democrats over which tax plan to push. Backers of a rival proposal, which would raise levies only on those with annual incomes of $1 million or more, were aggressively courting support for their idea.

Leaders of the California Nurses Assn. and California Federation of Teachers used the convention as an opportunity to meet with small groups of party leaders, sharing polling data and making the argument that their initiative can pass while the governor's is doomed to failure.

Federation President Josh Peschtalt received an enthusiastic response when he pitched his organization's proposal to labor activists Friday night. He cited polls showing that the sales-tax hike Brown wants is opposed by most Californians.

"It would be a shame to end up going for an initiative that really doesn't resonate with voters," he said in an interview Saturday.

Hundreds of delegates paraded around the convention center wearing stickers in support of the federation's "millionaire's tax" and expressing lukewarm views of Brown's measure.

"Pragmatically, I think it makes sense to go ahead with the millionaire's tax, because a lot of voters might think the governor's plan is too broad," said Pat Hurley, a delegate from the San Diego-area town of Lakeside.

Meanwhile, Feinstein, who is seeking a fifth term in the Senate, urged Democrats to make reelecting President Obama their "first order of business" and made light of Republicans' inability to find a top-tier challenger to run against her. She also said she was sorry Obama backed down from insisting that religious institutions cover birth control for their employees.

"I regret the fact that the president felt he had to do it," she said. "But he had to do it and I think it can be lived with."

Convention-goers also heard from House Minority Leader Nancy Pelosi (D-San Francisco), who said California was pivotal to Democrats' hopes of retaking control of the House of Representatives. New state voting districts have been drawn by an independent citizens commission, rather than gerrymandered by the Legislature to be safe for incumbents, and many experts say Democrats could pick up a handful of congressional seats in November.

"The road back to the House majority runs through California," Pelosi told the crowd, to wild applause.

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