Archive for the “California Budget” Category
I am returning Senate Bill 69 and Assembly Bill 98 without my signature
Who knows?
Brown announced the veto in a press release Thursday. “Unfortunately, the budget I have received is not a balanced solution,” his statement said. “It continues big deficits for years to come and adds billions of dollars of new debt. It also contains legally questionable maneuvers, costly borrowing and unrealistic savings. Finally, it is not financeable and therefore will not allow us to meet our obligations as they occur.”
Read the governor’s official veto message here.
The plan contains higher taxes, billions of dollars in delayed payments to schools, and various accounting maneuvers to balance the books. Brown had previously warned that he would not sign a budget containing such accounting gimmicks.
Democratic leaders in the Assembly and Senate said the plan they passed Wednesday was crafted without input from the administration.
It is unclear whether state lawmakers will receive their paychecks in the wake of the veto. Under a law passed by voters last year, legislators lose pay if they fail to send the governor a budget by June 15. Lawmakers said Wednesday they believe the budget they passed meets that test, but Controller John Chiang, California’s chief financial officer, will decide whether to issue their paychecks.
Brown’s veto is the latest twist in a budget process that has been just as divisive and partisan as it was under his predecessor, Arnold Schwarzenegger.
The ball is back in the California’s Legislature’s court, which I am positive they do not appreciate, especially if the California Controller decides to withhold their paychecks.
The Democrats who control the Legislature will either have to make more cuts or make some sort of deal with the Republicans to raise revenue – but in return for something. The likelihood of a deal with the GOP is extremely unlikely.
Plus, the unions who own the Democrats don’t want a tax election before 2012, because they wish to use their campaign cash to win a 2/3′rds super majority in the Legislature at the November 2012 general election.
So, it is the Schwarzenegger years all over again = budget gridlock and accounting tricks. But, Brown vetoed THAT budget today – so, what is next?
All eyes and ears in the California Legislature today will be on California Controller John Chiang to see if they get paid.
Bet they move fast, if their paychecks are withheld.
Tags: California, California Budget, California Legislature, Jerry Brown
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A morning collection of links and comments about my home, California.
Well, California has a “balanced” budget, albeit a Democrat majority vote one and questionably balanced. It will be within the purview of California State Controller John Chiang to decide whether the passed budget legislation is indeed balanced or he is empowered by California law to ding (meaning withhold) the paychecks of California Legislators.
California Governor Jerry Brown continues (supposedly) to negotiate with the Republicans in order to schedule a tax election or pass tax extensions to make budget revenues easier for him and the majority Democrats. No deal so far.
Brown who can either sign, allow it to become law or veto the budget has scheduled a High Noon 12 PM PDT news conference and we will all learn more then – if it doesn’t leak out before = likely. Brown has 12 days to take or not take action.
So, on to the links.
California Democrats pass budget with taxes, cuts and tricks
Democratic lawmakers passed a rare on-time state budget Wednesday over Republican objections, but the plan — balanced with a blend of taxes, cuts and clever accounting — faces an uncertain fate at the hands of Gov. Jerry Brown.
After warning for months that devastating cutbacks to schools and public safety would occur without the renewed taxes that Brown has sought but has been unable to sell to Republicans, Democrats averted the most severe reductions.
But they did so by returning to old strategies that have papered over California’s deficits for years: delaying the payment of billions in bills, skipping debt repayments and penciling in money that may not materialize.
Using their new authority to pass a budget on a majority vote — and under threat of lost pay if a spending plan was not approved by Wednesday — the Democrats pushed through provisions to hike car registration fees and local sales tax rates and force online retailers, such as Amazon.com, to collect sales tax.
The plan would also cut more deeply into higher education, the courts and local law enforcement.
“It is not perfect. It is Plan B,” said Senate President Pro Tem Darrell Steinberg (D-Sacramento), who nonetheless called the package “worthy of the governor’s signature.”
Democrats said they hoped Brown would continue to negotiate with Republicans for the taxes he wants, to make some of their cutbacks unnecessary. But their blueprint puts Brown in a political pickle. It asks him to break two pledges central to his campaign for governor: no new taxes without voter approval and no more smoke-and-mirrors budgeting.
Brown has not said whether he will sign the document; he has 12 days to decide.
Fight Breaks Out on California Assembly Floor During Budget Debate
A fight broke out Wednesday on the Assembly floor as Assemblyman Warren Furutani confronted Assemblyman Don Wagner over comments deemed offensive.
The two members jawed angrily in each other’s faces before Furutani, D-Gardena, appeared to give Wagner a shove, prompting several colleagues to separate them in the final minutes of the day’s budget session.
The dispute brought the house to a standstill for a couple of minutes during debate over a controversial redevelopment plan.
The two-bill proposal compels redevelopment agencies to backfill state coffers and give money to local governments under threat of elimination. Wagner, R-Irvine, testified that it was comparable to a shakedown scheme and referred to the popular HBO show, “The Sopranos.”
That prompted Assemblyman Anthony Portantino, D-La Cañada Flintridge, to demand an apology for the Sopranos reference “as a proud Italian American.”
Wagner retorted that he’d “apologize to any Italian Americans who are not in the Mafia and engaged in insurance scams,” setting off a murmur among lawmakers.
Minutes later, Furutani and Wagner were in each other’s faces and had to be broken up by three other lawmakers. The back of the Assembly chamber was soon flooded with legislative aides who came to see the commotion.
Democrats’ budget bills at a glance The budget bills Democrats approved Wednesday include a combination of tax and fee increases, spending cuts and revenue assumptions. Democrats and Gov. Jerry Brown previously took steps to reduce the state’s deficit by $11.4 billion, primarily through spending cuts.
Here are some of the key provisions of the latest bills:
Taxes and fees:
— $12 annual fee on car registrations to pay for Department of Motor Vehicle services. The department’s costs previously were covered by a voter-approved increase in the vehicle license fee increase that expires July 1.
— $150 annual fee on homes in rural areas that depend on the California Department of Forestry and Fire Protection for wildfire protection.
— A quarter-cent local sales tax. A 1 percent increase in the state sales tax is scheduled to expire June 30, so consumers would see a net reduction of three-quarters of a cent in the sales tax they pay on goods.
— Requiring online retailers such as Amazon.com to collect California sales taxes, a change projected to net $200 million annually.
Additional spending cuts:
— University of California, $150 million.
— California State University, $150 million.
— California courts, $150 million.
— County offices of education, $50 million.
Field Poll: California voters favor revamping “three-strikes” law
Most California voters see a court order to reduce the state’s prison population by 30,000 inmates as a serious problem, and nearly three out of four say it is time to revamp the state’s “three-strikes” law, a Field Poll out today finds.
The poll comes on the heels of last month’s ruling by the U.S. Supreme Court ordering California to address its prison overcrowding problem, and 79 percent of those surveyed said the matter is serious.
But there were not similar margins of support for Gov. Jerry Brown’s plans to transfer lower-risk inmates from prisons to county jails.
The poll found 51 percent of voters support the plan, with 37 percent saying it is a bad idea. Yet less than a majority of voters would support an extension of temporary tax increases to pay for it, the poll found.
The most significant finding came when voters were asked whether the state’s three-strikes law, which passed in 1994, should be modified to allow judges and juries more discretion when sentencing a criminal for a third felony.
The poll found 74 percent of voters would support allowing that discretion to ease prison overcrowding, with 24 percent opposed.
 Enjoy your morning!
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Flap’s California Morning Collection Archive
Tags: California, California Budget, California Three Strikes Law, Flap's California Morning Collection
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So, on to California Governor Jerry Brown for either his signature or veto.
For only the second time in 25 years a California spending plan was passed on time. One interesting part of that balancing act is an online sales tax, something lawmakers have been reluctant to approve in the past.
It seems like a no-brainer, the state needs money, so why not tax purchases online? We pay a tax when we buy the same products in the store. But critics say this tax could actually hurt some businesses in California. Those big online retailers, like Overstock and Amazon, have found a way around this law in other states. They just sever ties with businesses they deal with in the states with the tax. So companies that sell product to Overstock could lose Overstock as a client. This has put some small companies out of business.
The California state legislature needed to close a $9.6 billion deficit and this is expected to bring in $200 million a year in revenue. Some so called brick and mortar stores support this; they think it’s unfair that their product is taxed, but the same items online are not. The big question is do the benefits outweigh the possible side effects?
So, what happens next?
California Governor Jerry Brown can either sign the legislation, veto or allow it to become law. Brown has scheduled a 12 noon PDT new conference on the California budget and maybe we will know more then.
No word from Amazon or Overstock.com, but I bet their attorneys are preparing to file the lawsuits as soon as Brown makes his decision.
There will probably be a few court challenges.
One in federal court regarding the constitutionality of the nexus and the Commerce Clause. The other in California State Court regarding the imposition of a new tax without the 2/3′rds vote requirement of California Proposition 26.
Stay tuned…..and in the meantime, read this piece about yesterday’s legislative vote and what may portend for California.
Tags: Amazon Tax, California, California Budget, Internet Sales Taxes, Jerry Brown
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All eyes are on California Capitol today, as the the Legislature faces a 11:59 PM deadline to pass a balanced budget or have their own paychecks affected. Any odds at some sort of “balanced” budget will pass when legislator’s own bank accounts are on the line?
The answer is: YES.
Both the California Assembly and Senate have morning sessions this morning and the poop is that they will pass a majority vote “balanced budget.” Remember California Democrats hold overwhelming majorities in both houses, but lack the 2/3′rds super majority in order to raise taxes.
The California Legislature is facing an almost $ 10 Billion budget shortfall and is required by law to balance the books. Some of the proposals leaked out of the Capitol for the Democrat majority only plan include:
- Increasing the state sales tax by 1/4%
- Increasing car/vehicle registration fees by $12 each
- Imposing the “Amazon Tax” or internet sales tax collection requirements for online retailers who do not have a physical presence in California
- Charging rural homeowners a fee for firefighting services
- Cutting the budget of the California Court system by $150 Million
There are others, but the Democrats are floundering since most of the above will face certain court challenges or have no realistic ability to either cut spending or raise revenues. In other words, it is a SHAM and GIMMIC budget. Whether Democrat Governor Jerry Brown will go along with this Democrat majority only budget is uncertain.
Brown will continue to negotiate with the Republicans and hope for a better deal. The Republicans have no incentive to deal with the Governor unless some real reforms become reality – if even that.
So, on to the links:
Field Poll: Support Slipping for Jerry Brown, Tax Extensions
Gov. Jerry Brown still has public support for his tax plan, but the margin has slipped, and so has his public approval rating, according to a Field Poll released today.
The poll comes as legislative Democrats – frustrated by months of failed budget talks between Brown and Republican lawmakers – prepare today to take up a budget of their own.
Though Brown’s public approval rating has slipped just two percentage points since March, to 46 percent, many Californians who previously were undecided about Brown made up their minds against him. Thirty-one percent of voters disapprove of Brown’s job performance, up from 21 percent in March.
Fifty-two percent of registered voters surveyed said they would be willing to extend temporary tax increases to close the state’s remaining $9.6 billion budget deficit, a drop of nine percentage points from March.
Highlights of the Democratic budget plan
Highlights of the Democratic budget package that lawmakers plan to vote on Wednesday, according to Assembly budget staff:
TAXES AND FEES
$900 million –- Raise local sales tax rate by 0.25 percentage point
$300 million –- Raise annual car registration fee by $12
$200 million –- Require online retailers, such as Amazon.com, to collect sales taxes
$160 million –- Impose fee on residents in fire zones
CUTS
$500 million –- Cut spending on a local law enforcement program (could be offset by a vehicle tax hike, if GOP agrees)
$300 million –- Reduce spending on University of California and California State University systems by $150 million each
$150 million –- Reduce court spending
DEFERRALS
$2.85 billion –- Delay paying schools and community bills until the next fiscal year
$540 million –- Delay paying some UC bills until next fiscal year
OTHER
$1.2 billion -– Revive a new version of proposal to sell state buildings,and then lease space back
$1 billion –- Assume state wins lawsuit to take money from early-childhood programs
$800 million -– Additional unanticipated tax revenue
$750 million -– Cancel repayment of old school debts
$700 million -– Assume federal government will pay some Medi-Cal bills
Conservative heat to end redevelopment
Who would have guessed that California conservative icon Tom McClintock, the former longtime legislator from Ventura County and current congressman representing a district in Northern California, would step up at a critical time to give Democratic Gov. Jerry Brown a boost in promoting one of his controversial budget proposals?
The answer is, anyone who paid attention to McClintock’s position as a legislator on the issue of redevelopment. As a property rights advocate, he was a leading foe of redevelopment. Now he’s stepped up and released a You Tube video in which he calls on supporters to urge their state lawmakers “to abolish these rogue agencies.”
The video comes just as city governments and other redevelopment advocates are sounding the alarm about a potential vote in the Legislature on two developing bills to accomplish most of what Brown is seeking. One bill would abolish redevelopment agencies; the other would allow specific agencies to stay in business, but only if they agreed to turn over most of their current flow of property tax revenues to their local school districts.
Enjoy your morning!
Tags: California, California Budget, Flap's California Morning Collection, Jerry Brown, Tom McClintock
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A morning collection of links and comments about my home, California.
The California State Budget deadline looms tomorrow for the California Legislature. If a state budget is not passed, legislators have their pay docked – now, you see the urgency. In the meantime, California Republicans are not moving to support tax extensions which means the Democrats who are in the majority may pass a budget with accounting gimmics – like the under former Governor Arnold Schwarzenegger.
Now, the links:
Faced with loss of pay, Democrats are crafting alternative state budget
Facing a Wednesday deadline for passing a budget or forfeiting pay, Democrats in the Legislature are quietly drafting a spending plan they could pass without the GOP votes needed for tax increases or extensions.
The alternative plan would keep paychecks coming even though talks between Gov. Jerry Brown and Republicans have snagged on the issue of taxes.
“We will have a budget,” said Nathan Barankin, a spokesman for Senate President Pro Tem Darrell Steinberg (D-Sacramento).
Barankin and others close to the process declined to provide details. But a fallback blueprint would almost certainly rely on accounting moves and other measures that would merely paper over the state’s remaining $10-billion shortfall: Democrats, who have sharply cut back many programs already, have little appetite for further reductions.
Chronicle will not be pool reporter for Michelle Obama visit
Remember a couple of weeks ago when The White House got ticked off at Comrade Marinucci for posting video of activists protesting President Obama inside a San Francisco fundraiser? To Team Obama she was violating an unwritten rule on a print reporters posting video and they threatened to exclude The Chronicle from being the pool reporter in the future.
To other sentient beings, Comrade Marinucci was — and pardon the technical term here — “reporting the news.” News that MANY other non-journalists who were there at the fundraiser were recording with various camera phones. And she was perfectly within her rights to do so, The Chronicle has asserted.
Why we’re re-telling you this story: First Lady Michelle Obama comes to the Bay Area Tuesday and neither Comrade M — nor anybody at The Chronicle — will be the local pool reporter. Handling that gig will be two reporters from the Oakland Tribune. One is the Trib’s hunky, bearded political reporter Josh Richman and the other is a higher education reporter.
So just to get this down for the record, we asked the White House what was up. And with all due respect — as we’re sure he’ll do a terrific job — why was a higher ed reporter chosen to do the pool reporting on a political event in San Francisco?
The White House responded that pool reporters are chosen on a rotating basis.
More competitive seats under draft political maps, PPIC says
The number of competitive seats in the Legislature and in California’s congressional delegation would jump significantly under draft maps released Friday, according to an analysis by the nonpartisan Public Policy Institute of California.
More competitive seats could give Democrats a better chance of securing the two-thirds legislative majority needed to raise state taxes in future years, which would require capturing two additional seats in both the Assembly and Senate.
Under tentative proposals by California’s new redistricting commission, the number of competitive Assembly seats would rise from nine to 16; competitive state Senate seats, from three to nine; and competitive U.S. House of Representative seats, from four to nine, PPIC concluded.
No formula is considered foolproof in calculating the number of competitive seats. Analysts use different approaches and reach differing conclusions, serving as grist for lively debate.
PPIC defined a competitive seat as one that falls between a five-point registration advantage for Republicans and a 10-point advantage for Democrats, which it said reflects the fact that Democrats are more likely to cross party lines.
Democrats currently hold 52 of 80 seats in the Assembly; 25 of 40 seats in the state Senate, and 34 of 53 seats in the U.S. House of Representatives.
Dan Walters: The Big Stakes? Two-thirds Margin
There are many ways to view the new congressional and legislative district maps released last week by the state’s new independent redistricting commission, from the personal to the cultural to the geographic.
But to Capitol insiders, the most meaningful aspect is whether the Democrats can gain two-thirds majorities in both legislative houses and thus hegemony over tax policy.
Democrats are two seats shy of two-thirds in each house now, and that’s why the state budget is, as usual, stalemated. Republicans are refusing to vote for nearly $10 billion a year in tax extensions.
“We need four Republicans,” Gov. Jerry Brown declared Monday as he assembled a gaggle of business, labor and local government leaders to support extending the temporary taxes a few extra months and then asking voters to continue them for five years.
However, the tax extensions don’t play very well with voters in recent polling. Some Democratic leaders and their union allies have mused about plugging the budget gap with accounting gimmicks, loans and other one-time revenues, and concentrating political resources on getting two-thirds majorities in 2012 elections.
Enjoy your morning!
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Flap’s California Morning Collection Archive
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A morning collection of links and comments about my home, California.
This week the California State Assembly and State Senate face a Wednesday constitutional deadline to pass a budget. California Jerry Brown is looking for Republican votes for tax extensions and so far has not obtained them.
California Governor Edmund G. Brown Jr. provides an update on state budget negotiations as the June 15 deadline for a balanced budget approaches.
The question everyone is asking: will a Republican legislature sell out their party and no tax increase pledge?
Now to the links:
Jerry Brown offers state budget update in new video
Gov. Jerry Brown said in an online video Sunday that he wants changes in pensions regulations and state pensions to be part of a budget deal, but he still lacks the support from four Republican lawmakers to place those reforms and billions in taxes before voters this fall.
Brown said his plan “will put California’s finances on a firm footing for many, many years to come…but what we don’t have are the four Republican votes necessary to put it to a vote of the people of California.”
He did not outline what those policy changes would entail, but said he was “really perplexed at why a package of this magnitude and this permanence … cannot be allowed for you the people to decide on.
Brown posted the video to his YouTube channel Sunday, just three days before lawmakers are constitutionally required to pass a budget, to give his budget status report to voters.
This year, for the first time, lawmakers’ pay will be docked if no spending plan is in place by Wednesday’s deadline.
Brown plans to hold a Capitol press conference Monday with representatives from many of the various groups that have backed his budget, and the idea of placing higher vehicle, sales and income tax rates before voters, along with changes to state pensions and a limit of future state spending.
GOP attacks bill that would ease local tax votes
Now that Republican lawmakers have voted against a renewal of expiring tax hikes, Democrats are turning to another, more complex way to generate revenue.
A bill proposed by state Senate President Pro Tem Darrell Steinberg and narrowly approved last week would dramatically expand the taxing powers of local governments, school boards and other jurisdictions.
But the bill, SB23-1X, would lead to such a complicated latticework of taxes that opponents say Steinberg is merely pulling a stunt to ramp up pressure against Republican lawmakers.
The Sacramento Democrat said his legislation would give public schools and law enforcement agencies a firmer source of funding if lawmakers don’t come up with one directly.
It would grant sweeping authority to local governments to raise money, with voter approval, through taxes on income, vehicles, alcohol, tobacco, medical marijuana, soda and companies that pump oil in California.
Steinberg introduced his local tax proposal on Friday, soon after the defeat in the Senate of the main bill to renew temporary increases in the statewide sales and vehicle taxes that will expire June 30. It passed, but with only the bare 21-vote majority needed. One Democrat voted against it and three others abstained.
The bill applies to counties, school districts, community college districts and county offices of education. Critics said it would create a logistical nightmare of inconsistent tax policies that likely would be challenged in court and with a ballot referendum seeking to repeal it.
Redistricting: Rohrabacher says he’s staying put
With the release of a round of redistricting maps Friday, I mentioned that GOP Reps. Dana Rohrabacher, John Cambpell, Ed Royce and Gary Miller could be playing musical chairs.
Rohrabacher may be busy in the Middle East, but he found time to make it clear he doesn’t plan to look for a new district to run in.
The latest drafts throw Rohrabacher, R-Costa Mesa, and Campbell, R-Irvine, into the same coastal district (“OCCOAST” on the map). Campbell could run for the proposed Orange-Rancho Santa Margarita district instead – but Dave Gilliard, the consultant for Royce, R-Fullerton, says that Royce has been looking for a home in Orange and considers that the heart of his district.
If Royce stays in Fullerton and the new district surrounding that city, he could face Miller, R-Diamond Bar, since proposed map eliminate the GOP-advantage in Los Angeles County portion of his district. I’d give Royce the edge in that race, since Miller doesn’t live in the county.
Here’s the statement that came last night from Rohrabacher’s camp:
Congressman Rohrabacher announced today that whatever the end configuration of the districts, he will be running in the area of Orange County that he has represented for many years.
“I share a bond both philosophically and personally with these people. This is the area where people want limited government and personal liberty, which is something we share. I am raising my family here and feel very comfortable with the values of the people of this part of Orange County and they feel comfortable with me.”
Rohrabacher believes there’s likely to be shifts in the proposed district lines between now and the election but points to his long standing relationship with the people of the area.
“However the districts are shaped, I’m sure that the candidates and the voters will use this as a way of getting to know each other better. So we end up with districts that are more equal in population and voters who are more fairly represented.”
Enjoy your morning!
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Dan Walters: Will California become another Michigan?
Has California’s recession-wracked economy finally bottomed out and begun to recover, albeit slowly?
Or has California become another Michigan, doomed to a semi-permanent state of economic malaise?
Gov. Jerry Brown adopts the former version in his revised state budget. He calls it a “modest drawn-out recovery” and cites “positive economic signs” such as a fractionally declining unemployment rate, growth in manufacturing and rising exports from the state.
But the budget also notes such negative factors as “weak housing markets (and) depressed construction activity,” and Japan’s devastating earthquake. And it says that recovery will be painfully slow, with non-farm employment not reaching pre-recession levels until 2016, nearly a decade after the recession began.
Yes. A Michigan without any manufacturing, since it has left for other countries or states, is my best guess.
Which young couple wishes to wait for housing costs to come down to a manageable levels while social welfare costs, including public education and prisons skyrocket because of illegal immigration?
California may see some slight economic improvement but unless structural budget changes occur and the attitude towards business becomes friendly, California = Michigan.
The population exodus of educated, productive citizens will only accelerate.
Tags: California, California Budget
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