Sacramento -- The state's budget crisis took a surreal turn Monday after a frank discussion by a group of Democrats on the budget and its impact on their re- election was accidentally broadcast throughout legislative and reporters' offices.

Members of the Assembly Democrats' progressive caucus were heard making candid, if not intemperate, statements such as one by Los Angeles Assemblyman Fabian Nunez that they may want to "precipitate a crisis" over the budget this year. That might persuade voters to lower the two-thirds vote threshold needed to pass a spending plan, he reasoned.

"It seems to me if there's going to be a crisis, the crisis should be this year," Assemblywoman Jackie Goldberg, D-Los Angeles, said during the meeting. "What you do is you show people that you can't get to this without a 55 percent vote."

The unintentional broadcast was interrupted when someone informed the group that a microphone was on. "Oh s--," Goldberg said as the sound was cut.

Beyond its clutzy execution, the meeting suggested a split among Democrats in the Assembly over how best to confront the GOP's refusal to support any budget that contains a tax increase.

Goldberg said after the meeting that they were simply discussing issues and that the 10 members came to no agreement on how they would vote.

Assembly Speaker Herb Wesson, D-Los Angeles, downplayed the meeting, saying politics have not influenced his work on the budget. Wesson did not attend the caucus.

"We have stayed unified for the most part," he said of the Assembly Democrats. "I would hope that does not change."

QUICK RESPONSE FROM GOP
Republican staffers were quick to spread word, providing transcripts and instant rebuttals.

"Their intention is to destroy the state of California and its financial base," said Assembly Minority Leader Dave Cox of Fair Oaks. "They intend to hold up the budget."

The state is three weeks late in passing a budget to close a $38 billion deficit. Child care centers, trial courts and some highway construction projects are not receiving funds.

Legislators have been unable to reach agreement on how to pay for a bond to cover $10.7 billion of the shortfall. Democrats want to see a temporary half- cent sales tax increase, but the GOP has refused to consider any tax increase.

Senate leaders have been working on a plan that would not contain a sales tax but would cut another $1 billion in state spending. They hope to reach an agreement by either late this week or early next week.

In the meeting, Goldberg said making severe cuts now would be better for members who are facing competitive races next year.

"I think there's going to be a crisis, and the question is whether it should be this year or next year in terms of members of our house who want to get re-elected or in terms of members of our house who want to move to the Senate," she said. "Personally, I think the crisis is better off (happening) this year."

Assemblyman Tony Strickland, R-Moor Park (Ventura County), said the Democrats are putting "politics before people."

"They are willing to go on with crisis to try to lower the two-thirds threshold," he said.

INITIATIVE ALREADY CIRCULATING
The Service Employees International Union is leading a coalition that is circulating an initiative for the March 2004 ballot to lower the vote threshold from two-thirds to 55 percent. Business and anti-tax groups have already begun their opposition campaign.

California is one of only three states that require a two-thirds vote to approve a budget.

Goldberg said after the meeting that the purpose was to talk about what to do if the Senate sends the Assembly a budget plan that leaves the state with a huge deficit next year.

"We're on a death march to insolvency," she said. "We want to figure out how to let the people understand that we may be setting ourselves up for disaster."

Goldberg said she wants to see drastic cuts this year -- both to help save money for next year -- and to make people realize the condition the state is in.

One Democrat who was not in the meeting said he does not believe members of his party will be able to hold out for taxes the GOP clearly will not vote for.

"I just don't know that our folks ultimately will have the stomach for the kind of damage that kind of effort to shut things down will bring about," said Assemblyman Joe Canciamilla, D-Pittsburg.

DAVIS ATTACK ON GOP
The unintended broadcast also served to overshadow Gov. Gray Davis as he stepped up attacks on Republicans over the budget impasse Monday. Davis blamed them for creating a gridlock that is likely to delay payments of college grants for needy students.

The governor also attacked the Republican budget proposal, saying $600 million in cuts to the UC and CSU system would undermine years of effort to provide greater access to colleges for the poor.

"It's like taking a car that's moving comfortably down the highway and jamming it in reverse," Davis said during a conference call with reporters. "In addition to the policy reversals . . . their intransigence on the budget will almost certainly cause the state to miss first its CalGrant payment," due Aug. 1. On average, each of the 200,000 students in the program is supposed to receive $1,000.

The Assembly GOP plans to make more out of the issues raised in the meeting that went out of Capitol officer speaker boxes, planning a news conference for today to discuss it in more detail.