Exhausted and surprisingly muted legislators struggled early
Friday to finish closing a giant hole in California’s budget by
slashing billions of dollars from almost all state programs,
borrowing heavily from local governments, reducing state workers’
pay through furloughs and reforming some of the ways the state does
business.
By Steve Wiegand, McClatchy Newspapers
SACRAMENTO
Exhausted and surprisingly muted legislators struggled early Friday to finish closing a giant hole in California’s budget by slashing billions of dollars from almost all state programs, borrowing heavily from local governments, reducing state workers’ pay through furloughs and reforming some of the ways the state does business.
The Senate finished its work on a bulky package of 32 bills about 6:30 a.m. PDT after a long night that saw almost no speeches but plenty of earnest lobbying by leaders of both parties to secure the necessary votes.
But the Assembly was still struggling with major components of the plan, including proposals to allow some offshore oil drilling and siphoning off local government revenues. The biggest hurdle appeared to be a plan that cut deeply into funding for elementary and high schools and community colleges, but included a pledge that all of the cuts would be restored in future years.
Republican legislators objected to locking the state into a guaranteed repayment, and some GOP votes were needed to reach the two-thirds majority the bill required.
Democratic legislative leaders had worked out a backup plan to substitute simple majority bills _ which wouldn’t take effect for 90 days _ if the measure failed to gain a two-thirds vote. But after senators approved the bill 27-13, the Senate adjourned on its summer recess.
“Thanks for hanging in there and finding a way, sometimes against great odds, to get things done,” Senate President Darrell Steinberg, D-Sacramento, told his house.
Steinberg told reporters he had not promised Assembly Speaker Karen Bass, D-Los Angeles, to keep his house in session until the Assembly caught up.
“I’m confident they will get the job done,” he said. “I’m sure the Assembly will get it done.”
The marathon session got off to a contentious start Thursday evening in the Senate with the first bill, which contained billions of dollars in spending cuts. It initially fell short of the two-thirds approval it needed when most Republicans and some Democrats voted no or refused to vote.
GOP senators were opposed because of cuts in prison spending, while Democrats didn’t like cuts in social services.
After a clearly irritated Steinberg alternately cajoled and twisted the arms of recalcitrant lawmakers, the measure passed, 27-13.
But other issues, including a proposal to pull in $100 million by allowing new oil drilling off the Santa Barbara coast and siphoning off more than $5 billion from local governments, promised to push both houses of the Legislature into the wee hours of Friday morning.
Friday’s effort came 24 days into the new fiscal year. But unlike most years, California already had a budget in place. That was passed in February, complete with more than $12 billion in temporary tax increases.
Since then, however, a recession-wracked global economy has hammered state revenues, while some program costs have increased.
State voters deepened the deficit in May when they rejected $5.8 billion worth of proposed borrowing from the state lottery and two other special funds.
To close the gap, legislative leaders of both parties and Gov. Arnold Schwarzenegger put together a fragile plan that includes $15.3 billion in spending cuts; about $8 billion in borrowing, redirecting revenues from local governments and accounting maneuvers; and a $921 million reserve.
The overall $24 billion plan is less than the $26.3 gap lawmakers and the governor had said they were trying to bridge, largely because the final deal reduced the size of the state’s reserve.
The package reduces the state’s general fund budget to about $84.1 billion, a staggering 18 percent below the budget two years ago.
“This has been a grueling process, and as I’ve said over the last couple of days, while I feel some relief that it’s about to be over, it’s a very sober time,” Steinberg said.
Two issues were the most contentious. Environmental groups were irate about the proposal to raise $100 million by allowing offshore oil drilling off the Santa Barbara coast. Local officials have threatened to sue over the plans to redirect $5.2 billion from cities, counties and redevelopment agencies.
The package cuts a total of $5.7 billion from elementary and high schools and community colleges; $2.8 billion from state colleges and universities; $2 billion from health programs; $1.2 billion from social services; and $1.2 billion from the prison system. State workers will continue to be furloughed three days a month, representing what amounts to a 15 percent pay cut.
It also includes solutions that range from accelerating the collection of income and corporation taxes to pushing the last state worker payday of the fiscal year from June 30, 2010, to July 1, 2010, the start of the next fiscal year.
Other elements of the package include:
_The indefinite suspension of automatic cost-of-living increases for state colleges and universities, courts, the prison system and other state programs.
_Tightening eligibility rules for the state’s welfare-to-work program and increasing scrutiny of the In-Home Supportive Services program that provides aid to the elderly and infirm.
_A proposal to sell a number of state buildings, including those named after former Govs. Pat Brown and Ronald Reagan, as well as the Orange County Fairgrounds.
_The mergers and consolidations of some state agencies. The Bureau of Electronic Appliance Repair and the Bureau of Home Furnishings and Thermal Insulation, for example, would be merged into the Bureau of Electronic and Appliance Repair, Home Furnishings, and Thermal Insulation.
_The state lottery and the State Compensation Insurance Fund would be allowed to invest in bonds issued by the state treasurer to raise cash. But another bill would put part or all of SCIF up for sale.
