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Office of the Chancellor / Public Affairs
Monday, February 16, 2004
 

Sacramento Bee 2-16-04

A 55-percent solution urged, assailed in budget logjams
By Clea Benson

 

For 17 years straight, California lawmakers have failed to pass the state budget by their June 15 deadline.

During the worst budget battles, Democrats who refused to cut programs and Republicans who refused to raise taxes wrangled for months, forcing state contractors to survive on loans and creating hardships for people who depend on state services.

Now, state employee unions and other Democratic interests have placed a measure on the March 2 ballot aiming to end the annual stalemates. Proposition 56 would allow the Legislature to approve a budget and raise taxes with 55 percent of the vote instead of the two-thirds majority now required.

If voters approve it, the measure would change a budget law that has endured for 70 years. And it would amend a provision of Proposition 13, the almost sacrosanct anti-tax measure that voters approved in 1978.

Political scientist Bruce Cain, a professor at the University of California, Berkeley, sees Proposition 56 as an attempt to change the law to fit today's politics.

"The question is, do you change the rules to fit the politics or do you change politics to fit the rules?" Cain said. "The spirit of the times is not to cooperate. Do you give up on the hope that Democrats and Republicans will ever agree?"

California lawmakers have been passing state budgets with a two-thirds majority ever since 1933, when voters approved a constitutional amendment setting the high threshold.

But the need for a strong consensus on a spending plan hasn't always ended in fights and gridlock. For decades, legislators got their work done on time.

"We didn't fight as much at all," said state Sen. John Vasconcellos, D-Santa Clara, who has served in the Legislature since he was elected to the Assembly in 1966. "There was a real sense of camaraderie. We settled things on time because we knew we had a job to do."

There are several views on what happened to change that.

Vasconcellos blames the fighting on term limits and reapportionment, which brought in waves of new legislators with little institutional knowledge and little experience in the art of making deals.

Others blame a series of ballot initiatives that imposed more restrictions on how lawmakers could craft a budget and made the state's finances more likely to swing up and down with the economy. One of those measures was Proposition 13, the 1978 measure that capped property taxes and required a two-thirds vote for a tax increase.

Unable to come to an agreement over whether to raise taxes or cut services during the economic downturn of the past few years, Republicans and Democrats pushed off tough decisions by using accounting tricks and borrowing from future budgets, contributing to the current $15 billion deficit.

Proposition 56 could solve the gridlock by making it easier for one side to prevail.

Because Democrats currently control both the state Senate and the Assembly by more than a 55 percent margin, Proposition 56 would tip the balance of power in their favor, allowing them to push through budget and tax proposals without Republican votes.

Republican Gov. Arnold Schwarzenegger still could veto tax increases or the budget bill. But business groups are campaigning against Proposition 56 because they fear it could make tax increases easier if the state elects a governor who favors them.

"This will be with us long after the administration of the current governor," said Larry McCarthy, president of the California Taxpayers' Association.

Proposition 56 is especially unpopular with anti-tax groups because it would change part of Proposition 13 by dropping the vote required for a tax increase to 55 percent.

Proposition 56 "makes taxpayers the line of least resistance in solving budget problems," said McCarthy. "We don't have a budget problem because of the lack of money. There just simply is a failure to manage that money."

Proponents say it is simply more fair to allow a majority to decide budget policy, whether or not it includes tax increases.

"When you have a two-thirds vote, it's actually the minority that can determine policy," said Jean Ross of the California Budget Project, whose organization advocates for poor and middle-class Californians. "I think that makes it difficult to hold elected officials accountable for policies that you do or don't like in the budget."

California, Rhode Island and Arkansas are the only states requiring two-thirds or more of legislators to approve a budget, according to the National Conference of State Legislators. California is among 11 states that require more than a simple majority of state lawmakers to approve a tax increase.

Proponents point out that Proposition 56 still would keep California among the few states requiring more than half of legislators to approve budgets and taxes.

And they also emphasize the other changes that Proposition 56 would bring.

The measure would set up a rainy-day fund to be used in years when there is a budget shortfall. And it would force lawmakers to work on the budget if they missed their deadline, cutting off their pay until they approved a spending plan. They would not get the money back even after the budget passed.

State employee unions have been spending millions on the fight to pass the measure, while big alcohol, tobacco and oil companies have been spending millions to oppose it. Each side had raised close to $3 million by late January, and large contributions are continuing to pour in.

In the past two weeks, both sides began airing television ads in major markets statewide. Proponents' ads depict the Legislature having a food fight and emphasize that the measure would punish lawmakers when the budget is late. Opponents, meanwhile, are focusing only on the tax issue with ads claiming that Proposition 56 amounts to a "blank check."

Polls last month showed voters were split on Proposition 56, though only 20 percent of them were familiar with it. The Field Poll found that 37 percent of registered voters supported the measure, while 36 percent opposed it. The rest were undecided.

Both sides are working hard to swing public opinion their way.

"It's hard for the governor and the Legislature to do their jobs in a responsible way," said Trudy Schafer of the League of Women Voters of California, which supports Proposition 56. "Proposition 56 is a package of reforms that makes it easier for them to do their job."

McCarthy sees it another way.

"They're talking about getting budgets done on time," he said. "I think that's a tangential purpose. It is really about making it easier to raise taxes."