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| Office of the Chancellor / Public Affairs |
Tuesday, June 10, 2003
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Ventura County Star 6-10-03 Tax bickering threatens budget |
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| SACRAMENTO -- With both parties appearing more entrenched in their opposing positions on the need for a tax increase to help solve California's $38 billion budget crisis, outside groups on Monday attempted to put some pressure on lawmakers to end a stalemate that could threaten the state's fiscal solvency. A coalition of teachers, school board members, the PTA and other education interests kicked off a $1 million radio advertising campaign that calls upon lawmakers to "end the partisan legislative bickering" and pass a budget that protects schools and includes a half-cent increase in the sales tax. At the same time, Treasure Phil Angelides, a Democrat, wrote to the Legislature's two leading Republicans urging them to begin negotiating in good faith because "none of us can afford to bring the state to its knees." Finally, a small group of individuals staged an anti-tax "tea party" on the Capitol lawn, at which GOP legislators reiterated their position that under no circumstance would they vote for any solution that includes a tax increase. "It won't happen, so don't even try it," Assemblyman Tony Strickland, R-Moorpark, warned Democrats. Echoed Assemblyman Dennis Mountjoy, R-Monrovia: "It's a good day for a revolution." The key difference between Republicans and Democrats is whether to enact a temporary sales tax increase to pay off a $10.7 billion loan that would pay off the state's accumulated deficit at the end of the fiscal year. Both sides support the borrowing idea, but Republicans want to use existing tax revenue to pay off the loan. The GOP's anti-tax rally follows by less than a week a dramatic presentation by Senate minority leader Jim Brulte to the Republican caucuses of both houses of the Legislature. At that session, Brulte vowed that he would personally campaign for the defeat of any GOP legislator who voted for any plan that included a tax increase and showed a mock political hit-piece to bring home the message. The Education Coalition, a group that includes the California School Boards Association, the state Teachers Association and the state PTA, attempted to counter Brulte's message by urging voters to pressure lawmakers to adopt a budget that includes the half-cent sales tax that the group says is essential to protect education funding. Clyde Rivers of the California School Employees Association noted that school budgets have been cut by $4.1 billion over the last two years and face another $1.5 billion reduction in Gov. Gray Davis' revised budget proposal for next year. "Make no mistake, these are painful cuts," Rivers said. "But more painful is the prospect of legislative bickering and not passing a budget on time, because right now our schools are on hold." One of the ads, which began airing Monday in Los Angeles, San Francisco, Sacramento and Fresno, features a teen-age student questioning how legislators could be late passing a budget because if he turned in his schoolwork late he would flunk. Assemblyman Keith Richman, R-Northridge, a leader of a bipartisan group of lawmakers that has been attempting to find grounds for compromise, encouraged other interested groups to turn up the heat on the Legislature. "Schools, colleges, business groups, health-care providers -- all have reason to push us toward a comprehensive budget solution," Richman said. Brulte's remarks last week came on the heels of behind-the-scenes efforts by some lawmakers and interest groups to link passage of business reforms, including a revamping of the Workers' Compensation system, to enactment of a budget. Such a deal would likely require Republicans to sign off on some tax increases in exchange for Democratic agreement to support some business reforms opposed by organized labor and plaintiff's attorneys. "All the pieces of a comprehensive budget solution are there," Richman said. "It's not like you've got to go figure them out." Pessimism over the prospects for a timely budget agreement has heightened concerns that the state's standing in financial markets, already bad, could become further downgraded. That situation, Angelides said in a letter to Brulte and Assembly Republican leader Dave Cox, "could jeopardize our ability to access the capital markets for cash flow and critical investments." Angelides wrote that Brulte's political threat had "crossed the line" and sent a signal to Wall Street that "rancor will trump good-faith efforts to resolve policy disagreements."
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