If you care to look, it seems that the Sacramento press corps (all three to five of the hardy souls) have just written either a wrap up of 2011 or a preview of 2012. You basically get a few points with slightly different order depending on the writer(s), but here are a few points worth noting:
1) Jerry Brown is just Jerry Brown
That isn't to say he's any worse than any other governor that we could have ended up with, but that he's not some super hero who can ride in to save the day. Even with all of his experience, he can't magically do Jedi Mind Tricks on the Republicans to somehow be reasonable. I think there was a lot of hope this time last year that Jerry Brown, with all of his experience a generation ago, would be the adult in the room for the bunch of children in the legislature. But I suppose sometimes the delinquents win.
2) 2012 will be a make or break year for Brown and California generally. Or not.
This is sort of a funny one. Because, really, the same thing has been said about our situation for the last four years or so. Really, ever since the worst of the budget mess began, we have been playing with fire. So, in that sense, yes, every year is really important, but somehow we've been able to find some way to make the cuts, cuts, cuts and more cuts into our budget to avoid any real decision-making. Yes, those cuts are a real decision, but more in the passive sense. We have left the decisions for a few whims of whomever gets the last word at the dais of the respective budget committees, or whomever manages to catch the leaders at an opportune moment.
They say that budgets are a statement of our priorities. But I hope, for all of our sakes, that isn't true of the past five years. Is it really our priority to make the school year shorter? Or to abandon our sick and elderly? Or to cut fire protection services? It is hardly any robust statement of priority when there is a gun at your head. Our system is so skewed towards one particular priority, taxes, that we have lost all sense of everything else.
Perhaps this is the year that changes that, but from the statements of Sen. Steinberg and Spkr Perez, I wouldn't expect much from the Legislature. They seem content to wait back for the Novemeber election and to satisfy the budget deficit ($13B-ish) with cuts alone until then.
"My view is you always have an open door and outstretched hand, but I don't think we do anything as our main strategy that requires a two-thirds vote," Steinberg said. "We're gone down that path far too many times."(SacBee)
So, perhaps we'll see a fairly standard legislative year. Maybe something happens with pensions, but more likely, we are in a holding pattern until something is determined at the ballot box with a revenue measure of some sort in November.
3) New Districts and Top 2 Will Bring Changes to Composition of Legislature
At the very least, we will see something new here. There will, most certainly, be several Dem-on-Dem elections in November. Laura Richardson and Janice Hahn, Howard Berman and Brad Sherman seem destined for some expensive races. There may be a few Rep-on-Rep, but the numbers and costs will likely be far fewer. The thing is that there is usually enough Democratic support to get one Dem in a deep Red district top 2, but that isn't always the case in some of the Bluest seats. Or to flip that, the Deepest Blue is darker than the deepest red.
Now, as to the districts, well, there is still the question of the Senate district referendum. There is still no word as to whether it will qualify (but expect some sort of word within a few weeks as to whether they will need a full count verification). But, with the signatures out there, the sponsors of the referendum (GOP Senators for the most part) are trying to get some other map more to their liking. The Supreme Court will likely decide on that fairly soon as the SoS needs to prepare for the elections.
There is a very real chance that the Democrats get 2/3 in the Senate (and take away whatever power the Senate GOP caucus had), but it is extremely unlikely that the Assembly Dems are able to do the same. (Cali_girl_in_texas has the over/under at 50). I'm skeptical that situation would really bring all that much change. Democrats would just be paying more attention to the Assembly. Just a few different, slightly more radical, people in the position of blocking action.
Well, it's about time to get rolling into a new Legislative year, should be fun!
Another round of cuts is hardly worth celebrating, but Brown seems to have at least saved the 175 day school year.
K-12 school districts were at risk of losing as much $1.5 billion - the equivalent of seven instructional days - under the budget Brown and lawmakers enacted earlier this year. But they will face a smaller $79.6 million reduction in general funding. That should avert massive reductions in the school calendar or other drastic measures for most districts.
"It turns out the cuts are far less than they would have been," Brown said.
Districts will still face a $248 million elimination of school bus funding, however. Jill Wynns, president of the California School Boards Association, said districts will cut somewhere other than buses because they are mandated by federal law to provide transportation for students with disabilities.(SacBee)
Also getting big cuts? Higher education. UC, CSU, and the community college system all lose $100 million. Community College Chancellor Jack Scott has indicated that will mean a $10/unit fee increase for community colleges, and UC and CSU will likely see another round of fee hikes.
Director of Finance to hold meeting at noon regarding the "trigger cuts"
by Brian Leubitz
Today's the day. If you remember back to the disaster that was last year's budget there was a $4B mystery source of revenue that was basically a cross your fingers and hope real hard kind of thing. The legislature then asked the Controller (John Chiang), the Legislative Analyst (Mac Taylor) and the Director of Finance (Ana Matosantos) to track how much revenue was coming in, and then if that $4B did not come in, "pull the trigger" on cuts of up to that amount that were already determined.
Well, today is that day, and Matosantos, Brown (and formerly Schwarzenegger's) Director of Finance has to decide how much will be cut for the 2012 part of the current fiscal year. Don't expect much good news, as the Controller's office already released data indicating that we weren't going to hit that target. Oh...and we spent more than we projected.
After accounting for November revenues, total year-to-date general fund revenues are now behind the budget's estimates by $1 billion, but expenditures for the year are over projections by $1.95 billion. It turns out that during a bad economic period, people need more services, but in the current climate in Sacramento, getting the legislature to approve the revenues for those services is an impossible feat even for somebody with the experience of Jerry Brown.
And so we go to the people, I suppose. According to a new PPIC poll, Californians are not particularly interested in a cuts only budget.
A new poll shows 60 percent of California voters, weary of state spending cuts and unsettled by the prospect of more, are ready to support Gov. Jerry Brown's plan to raise taxes. ... When asked about those automatic spending reductions, part of the budget package signed last summer, a plurality of likely voters - 45 percent - say they would prefer a mix of spending cuts and tax increases to address the shortfall, according to the poll.
Brown, a Democrat, is seeking to raise the statewide sales tax a half-cent and increase income taxes on people who make $250,000 or more a year. He opened a campaign committee last week, and his political adviser, Steve Glazer, has started fundraising for the effort.(SacBee)
There is a long time between now and November 2012, and a lot of painful cuts remain no matter what happens at the ballot box. But as we continue this slow motion take-down of the California Dream, we'll need to consider what our values really are. Perhaps we really are a state that is only concerned about our present day self-interest, but I have higher expectations for Californians. We can, and will, break out of this viscous cycle of cuts.
I was going to make this post about the Governor's approval numbers, but he just made it a little bit more interesting by releasing an "Open Letter to the People of California." Quite auspicious sounding, but what it really is his revenue plan. Here's the meat of that plan:
My proposal is straightforward and fair. It proposes a temporary tax increase on the wealthy, a modest and temporary increase in the sales tax, and guarantees that the new revenues be spent only on education. Here are the details:
Millionaires and high-income earners will pay up to 2% higher income taxes for five years. No family making less than $500,000 a year will see their income taxes rise. In fact, fewer than 2% of California taxpayers will be affected by this increase.
There will be a temporary ½ cent increase in the sales tax. Even with this temporary increase, sales taxes will still be lower than what they were less than six months ago.
This initiative dedicates funding only to education and public safety--not on other programs that we simply cannot afford.
This initiative will not solve all of our fiscal problems. But it will stop further cuts to education and public safety.
This is basically what we have heard in the past, a hike on the highest earners along with a sales tax, and all of it dedicated to education and public safety. Red meat for both parties, a little tough on crime with a little teaching. Or, in other words, this package seems built from the ground up to win on the ballot. Polling numbers show broad opposition to additional education cuts, and without revenues, those are simply inevitable. While this package probably isn't exactly what we would draw up in a perfect world, the California system of government is anything but perfect. His language in this open letter is political-speak not intended for progressives. It is full of statements about how we can't afford programs (see the quote above) and how awesome it is that are spending levels are at percentages not seen since the seventies.
We could pick at the email, his talking points, and the specifics of the proposal. But Brown and his partners are building something that they think can win at the ballot, represent good policy in the long term, and help us out of the current budget crisis in the short term. It's not exactly an easy shot to wrap up those three objectives with a nice shiny ribbon.
And perhaps he has the juice to push the measure across the finish line. Today's Field Poll shows the Governor's approval ratings pretty much right at where he has been for most of his term, in the upper 40s. The current figure of 47% is down from 49% in September, but still within the margin of error of that survey. However, his disapprove numbers have continued to creep up as "undecideds" jump off the fence and create a 36% disapprove figure.
There are a number of reasons why Californians would begin to grow wary of the Governor, but the budget, as ever, looms large.
"The public is, I think, bracing itself for additional spending cuts, and that's never a good situation, either for the governor or a state Legislature," poll director Mark DiCamillo said.
With state revenue falling below projections, the Brown administration is expected this month to announce highly unpopular, automatic spending cuts in service areas including schools. Nearly two-thirds of Californians consider the trigger cuts, part of last summer's budget package, a bad idea, including majorities of Democrats, Republicans and independents, the poll says.(SacBee)
The trigger cuts were a device of sorts to get a budget done, and from discussions in Sacramento, not a whole lot of people liked them there either. But they enabled the Legislature to get enough votes from the two Democratic caucuses to pass the odious budget. However, as the majority budget rules don't include revenue, we are still faced with the same difficult situation as we had at the beginning of the year: convince a Republican to think beyond the four walls of his own career, or continued austerity. Both Democrat and Republican voters are far from excited on the triggers, but with revenues continuing to fall below projections, they are likely to be triggered early next year.
Brown's revenue proposal will help fill in many of those cuts, but won't kick in until the end of next year. It is far from ideal, but with a recalcitrant Republican caucus it is what we have. The measure is being submitted to the AG's office today and will be circulating with plenty of time to get it on the November ballot.
Read the full "Open Letter to the People of California" over the flip.
Asm. Anthony Portantino has had his run-ins with Assembly leadership. Many of them, some of which resulted in getting tossed in one of the so-called "doghouses" and getting his office budget cut. The spat got really nasty when the Rules Committee demanded a rather large cut from his office and accused him of overspending. Portantino then took it upon himself to release his budget records and demanded that the rest of the Assembly do the same.
That was a few months back, and since then the Senate has released most of their records but the Assembly is holding back. Perhaps it is part of the Portantino feud, or perhaps it is just to be consistent with years past. Nonetheless, a Sacramento judge issued a tentative ruling yesterday ordering the Assembly to release the records.
Earlier this year, Assembly administrators had claimed that the records were confidential under provisions in the Legislature Open Records Act that exempt "preliminary drafts, notes or legislative memoranda" and "correspondence of and to individual members of the Legislature and their staff."
On Thursday, Frawley said the Assembly "improperly withheld" the records and chided the lower-house for its "somewhat ironic" view of the open-records law, with legislative lawyers arguing for "a narrow interpretation that significantly restricts the public's right to inspect legislative records."
"The records requested by the news organizations indisputably contain information relating to the conduct of the public's business," Frawley wrote. "The records all reflect how Assembly money is budgeted and spent, which is critical to an understanding of the Legislature's operations."
The judge strongly rejected the Assembly's argument that the records qualified as confidential "correspondence" under the open-records law.(LA Times)
Tentative rulings are rarely changed, and the Assembly has apparently seen that it really isn't worth the PR hit to continue this fight, at least for now. Yesterday they announced that they won't be protesting the ruling at the hearing with the Judge. However, they can still appeal, but again that is hardly without risks. The longer this goes on, the more (negative) attention it gets. And with an approval rating hovering around 10%, that's really the last thing the Legislature needs.
While we might not get the records right away, expect to see them fairly soon. Heck, who knows, maybe some interesting information is hiding out in those budgets.
Governor aims to increase highest tax bracket and sales tax for a limited time
by Brian Leubitz
If nothing else, Gov. Brown is ambitious this go-round. While his pension plan is slowly simmering in the Legislature, he knows that we really can't continue to function with cuts-only budgets. With the impending decision by Director of Finance Ana Matosantos on whether to pull the triggers in the last budget deal, we are looking at billions more of holes in the budget to fill. (And at this point, the only question that is out there is how much of the triggers will be pulled.)
Brown has mentioned that he will be bringing something to the ballot in terms of revenue, but it seems that there is serious movement on it now. He's been meeting with labor and his supporters too work on a plan that they can agree to get on the November ballot.
In the latest proposed fix for California's fiscal crisis, Gov. Jerry Brown is expected to announce a multibillion-dollar tax initiative in the coming days, asking voters to raise levies on upper-income earners and increase the state's sales tax by half a cent.
The levies would expire at the end of 2016, said sources with direct knowledge of the plan. The governor's office has been fine-tuning the tax measure for weeks with its labor allies. It hopes to file language with the attorney general's office as early as Friday so it can start gathering the signatures needed to place the measure on the November 2012 ballot.(LA Times)
The plan would buy four-five years of time in order to both reset the budget and hope that the economy recovers. Over the past six months there have been a raft of proposals being discussed from various organizations, and the most sure way to losing on all of them is having more than one tax measure on the ballot. If this does hit the streets fairly soon as anticipated, other potential measures will probably die quietly.
Until we see the details on this measure, I'll reserve full judgment. I do not like the inclusion of sales taxes, one of the most regressive taxes, but they do seem to be the most likely to pass. Other than taxing the 1% that is. Expect further details by next week at the latest.
If you look up "tone deaf" in the dictionary right now, you might find a photo of Nicholas Berggruen. He's the billionaire investor who founded the "Think Long Committee for California" last fall to revive corporate friendly "reform" policies. In news that should shock nobody at all, their tax proposals involve shifting the burden away from the rich and corporations and onto what's left of the middle class. From Capitol Alert:
A coalition backed by some of the biggest names in California politics and a billionaire financier is readying for the ballot a sweeping overhaul of the Golden State's tax system....
Californians would pay sales tax on all services except health care and education starting in July 2013.
The tax hike would boost state revenues by about 11 percent starting in 2013-14. The money would help retire debt in the first year and later go toward K-12 schools, higher education and local governments.
The state would also simplify the personal income tax system in 2014, charging no tax on income up to $45,000 for joint filers; 2 percent on income between $45,000 and $95,000; and 7.5 percent on income above $95,000.
The state would eliminate all personal income tax deductions except those on mortgage interest, property taxes, charitable donations and research and development. The sales tax rate on goods would drop by half a percentage point.
On average, taxpayers at every income level would pay more due to the new service tax. Households with adjusted income below $20,000 would pay $71 more annually, though they may be eligible for a sales tax rebate.
The plan lowers the corporate tax rate from 8.84 percent to 7 percent. It also raises taxes on out-of-state firms by requiring them to pay based on their share of sales in California.
In short: corporate taxes go down, income taxes go down for everyone but especially for the rich, and the sales tax goes up (in fact if not in rate). The middle class - what's left of it, at least - would shoulder the burden of taxation in California even more than they already do.
The article itself is strangely written, as if Torey Van Oot and Kevin Yamamura agreed to obscure the true nature of the proposal by not describing how the personal tax rates change from the present day. Here's the current personal income tax rates for joint filers:
$96,058 and up: 9.3% (with a 1% surcharge for incomes over $1 million)
$76,008 to $96,058: 8%
$54,754 to $76,008: 6%
$34,692 to $54,754: 4%
$14,632 to $34,692: 2%
$14,632 and under: 0%
Under the Think Long plan, all the rates would go down, but the rich would see a big drop from 9.3% to 7.5%. And yet as the article notes, with the sales tax changes the overall impact would mean that everyone else pays more. Because the income tax would only kick in at $45,000 for joint filers, it's the middle class that gets hit hardest.
It should come as no surprise that a billionaire's proposal for California is to give himself and his wealthy friends a huge tax cut and screw everybody else in the process. I am not at all opposed to asking the middle-class to pay more, everyone is going to have to pay a bit more to reverse California's slide into the abyss. But that should be a progressive solution that includes asking the rich to pay a LOT more than they currently do, not asking them to pay less.
It's also rather stunning to see this proposal come out as Californians have begun taking to the streets to protest policies exactly like this that favor the 1% at the expense of the 99%. Berggruen and the members of the Think Long Committee that are giving him cover have either not paid any attention to the Occupy movement or do not think it has much influence.
Still, it is difficult to see how this proposal stands a chance of passage. Voters aren't stupid - they might like the income tax cuts, but will revolt at paying more sales tax, especially as they see the rich and corporations getting a big tax cut.
The proposal takes California in the wrong direction. There's no doubt the state is in crisis. College is becoming unaffordable. K-12 schools may have to cut a week off of the school year. Millions are without guaranteed health care. Unemployment is at 11.7%. To solve those crises, government needs to step in and rebuild the middle class by providing free college, by massively investing in K-12 schools, by providing free and universal health care to everyone, by directly hiring people who need work, and by building out a 21st century infrastructure that will save money by reducing dependence on oil.
Making that happen requires going after the wealth currently controlled by the 1%. Income tax rates on them need to go up - way up. Higher tax rates on the rich and on corporations will actually spur economic growth by rebuilding the middle class, giving people the space and support they need to innovate, create jobs, and repair their balance sheets.
If Berggruen wanted to actually do something to help California, he would take the $20 million he is pledging to spend on this shockingly regressive proposal and instead invest it in an initiative to raise taxes on the rich, on corporations, and to fix the state's unfair property tax system. Instead he's using it to help himself and his friends get even richer.
This proposal is worse than a joke - it's an insult. It should be denounced early and often.
I've been a little quiet around here, as I was more than a bit busy with the election and then trying to recover from said election. And Sacramento was hardly hopping either, just a few press conferences here and there. However, Leg Analyst Mac Taylor (and sometimes Right-leaning Budget Warrior) has been on the grim watch on our state finances along with Finance Director Ana Matasantos. And grim is really the best adjective for the situation:
The report by the Legislative Analyst's Office says the state faces a budget deficit in the current fiscal year largely because it will collect only $300 million of $4 billion that Gov. Jerry Brown and the Legislature added to the budget just days before it was approved in June. Critics had called the sudden infusion of projected revenue "phantom money" that was conjured to avoid deeper spending cuts.
The report says California also faces a budget deficit in the 2012-13 fiscal year of $13 billion.(SF Chronicle)
I'm not sure how bright I can highlight this situation, but we are steamrolling towards another budget crisis. And guess what, there is so little left to cut, there will be no other choice to cut deeper into some already devestated state services. Of course, much of that could be avoided with a bit of reasonableness from the other side of the aisle, but let's be realistic here. Unless somehow four Republican legislators get a Dickensian like visit from beyond, do we really think that is going to happen?
Now, the ultimate determination will be made by Matasantos by December 15, but given that relatively few of those $4Billion have come in, it is tough to imagine that she will have much choice. The $4 Billion will hit education particularly hard, with the possibility of eliminating 7 school days from the year. As David Dayen points out, the threat of a $13B series of cuts threatens to make ridiculously small the few parts of President Obama's jobs package that can pass Congress. $1 Billion in veterans benefits will do little to combat the biggest of the 50 Little Hoovers here in California.
It is hard to really blame Gov. Brown for much here, other than his rosy expectations. The Right will take the usual attack on Democrats of being too close to labor, but even if he totally decimated pensions and laid off huge portions of the state public employees, we still wouldn't get near dealing with the situation. But the fact remains that the $4 Billion that has failed to show was put in the budget because the cuts without them would have been unbearable.
So California, meet the dystopic future, where cutting K-12 school days and rocketing higher education fees are the best option.
“Proposition 13 set up an unfair and dysfunctional two- tiered system of property taxes. It choked off a source of revenue, and the lack of that revenue has brought California to the edge.” –Kevin Starr, historian and California State Librarian Emeritus
Many Californians would agree with Kevin Starr that our state is teetering on the edge of disaster. Unemployment remains the second highest in the nation, 32 percent of all mortgaged homeowners are underwater, public schools have been cut to the bone and public universities are unaffordable for the middle class.
Big business and their Republican allies have repeated the laundry list of why California’s economy is struggling so many times that it is practically written in stone—Taxes, Regulations, Public Employees. These are the unholy trinity that supposedly crashed California’s economy and threatens to smother any business growth in the future.
The facts, however, contradict the well-worn talking points of big business. The Council on State Taxation, a business-friendly group led by CEOs of major corporations, found that California has a moderate tax burden, taking less in taxes from business than many other states, including the sweethearts of the right, Texas and Florida.
Many experts look at regulations as job creators, in addition to the benefits to public health and worker safety. Roger Noll, co-director of the Program on Regulatory Policy at the Stanford Institute for Economic Policy Research breaks down the GOP’s obsession with regulations:
The effect of regulation on jobs has nothing to do with the mess we’re in. The current rhetoric about regulation killing jobs is nothing more than not letting a good crisis go to waste.
He goes on to state that regulations may affect job distribution, but not the total number of jobs, eliminating the possibility that California’s landmark environmental laws crashed the global economy causing the current recession.
As for public employees, it requires leaps of logic to understand how laying off thousands of teachers, nurses, home health aides, crossing guards, librarians and public works crews makes the state a better place to do business. California already has the 4th fewest state employees per capita as any other state—even Texas has more state workers per capita than we do! And more than a third (37 percent) of those public employees are at UC or CSU—I doubt laying off professors, economists and business school personnel will please the business community too much.
That begs the question, then, why is California on the edge? Putting aside the deregulation of Wall Street and their subsequent destruction of the global economy through risky and irresponsible gambling, why is California in such a dismal economic state?
A reporter recently put that question to state historian Kevin Starr. He traced the beginning of California’s decline to 1978, the year Proposition 13 passed. Prop 13 capped property taxes, limited local governments’ ability to raise revenue and imposed a two-thirds majority to raise revenue.
Prop 13 has had profound negative consequences for California on all levels. Local government is starved of revenue and dependent on the state to keep schools open and local employees on the job. In turn, the budget crunch forces deep cuts to UC, CSU and every public program that impacts the lives of Californians. At the same time, elected officials can’t vote to raise revenue without a supermajority, giving the minority of anti-tax Republicans disproportionate veto power.
While Prop 13 was seen as a populist measure, corporations have been the true winners. Across the state, the burden of property taxes has shifted radically from corporations to homeowners. A recent report by the California Tax Reform Association (CTRA) cites numbers for all counties showing how homeowners have taken on a significant burden of funding public services, while corporations have shirked paying their fair share.
Every year, legislators from each house get a certain number of bills they can carry. It varies from year to year, depending on leadership, but can vary from as little as 10 to well more than double that number. Every year, legislators basically go shopping for bill ideas. Some of them come in through the normal constituent relationships. Others from lobbyists of sponsoring organizations, and well, various other sources.
The interesting part of this is that legislators typically want to get their total up to the line. Whether that is to make it appear that they have a lot of accomplishments, or to look busy is a matter of perspective. However, every year we get a slew of bills at the end of session, many very important. Others, well, less so.
Gov. Brown prefers a less is more approach, and when it has come to vetoing bills that have come across his desk during this bill frenzy, it has shown.
From mid-September to late Sunday night, Brown signed 466 bills and vetoed 97, his office said.
Brown's veto rate for the year overall was slightly lower, at about 14 percent. In the first year of his third term, Brown signed 760 bills, vetoed 128 and allowed one bill to become law without his signature, his office said. (SacBee)
Now, the 17.2% veto rate isn't astronomical, as it is far lower than Gov. Schwarzenegger's rate. However, given that his party is in control of the Legislature, you would expect that number to be slightly lower. But, again...less is more in Jerry's world.
There were a few bills on the recent action pile that are worth a bit of note. Sen. Juan Vargas' bill against supercenters, SB 469, got the veto stamp. The bill would have required supercenter developers to conduct an economic impact report to disclose impacts upon local economies prior to being approved to build in a local jurisdiction. But, with the false notion that we don't want to slow Wal-Mart from "creating jobs", nobody has really sat back and thought of the real economic toll on the economy. And apparently, it won't be happening in 2012 either.
Brown also vetoed a bill regulating "debit card paychecks". These debit cards are targeted at low income workers and carry some pretty onerous fees, as part of the high cost of being poor. But banks generally get their way when their lobbyists are involved, and they were able to get Gov. Brown to kill the bill while saying that he wants to work with the institutions and the Legislature to find a "compromise" for the debit cards.
Finally, in case you didn't hear, the Governor signed the shark finning ban, at least one bill that environmentalists and progressives could count as an accomplishment.
Three years before the election, Governor already faces scrutiny about his plans.
by Brian Leubitz
While Jerry Brown was busy over the weekend signing bills to ban synthetic marijuana and bar a San Francisco measure to ban circumcision, apparently people are pretty excited about replacing him. Or perhaps more accurately, people are excited to talk about people who could replace him.
"I've extremely enjoyed my first year," Brown said. "I find it -- I don't know if I'd call it exhilarating -- but I find it quite engaging and interesting and fully worthy of my total involvement."
There had been speculation when the now 73-year-old Brown was first elected to what actually amounted to a third term that he would not run again.
If he does decide to seek another term it would cause serious damage to any number of folks who want to be governor. (LA DN)
Of course, this came up in the context of an interview with CalBuzz a while back, though from their article, the question seemed to be directed more at how Brown was handling his first year back in the Horseshoe. But, Sacramento being what it is, there are always people eyeing the top spot, and tons more willing to talk about people eyeing it. From every statewide elected official to a the big city mayors, there will be attention on the 2014 race.
Did I mention that Brown has been in the office less than a year? Welcome to the 24 hour news cycle.
The Legislature cheered the Amazon deal, after all they were hardly in the mood to fight it out with one of the nation's largest tech companies. I mean, after all, we can't offend corporations, can we? But that little deal cost the state around $200 million in this budget. Not the biggest concern in an 80-something billion budget, but certainly not good news.
But the bigger question is what happens if somebody pulls the thread on Prop 98's school funding requirements? We are underfunding K-12 by billions of dollars, and would you trust this state to pay up later? And does that really make up for it anyway? You can't redo first grade five years later.
Well, consider the string pulled several times:
California's budget, already on shaky footing with tax revenues coming in lower than forecast, was hit with three new problems Wednesday when advocates for public schools, the developmentally disabled and cities filed separate lawsuits challenging the spending plan.
The California School Boards Association, the Association of California School Administrators and three school districts claim the budget shortchanges schools by $2.1 billion, while service providers for people with developmental disabilities argue that a $91 million cut runs afoul of federal and state mandates.
The League of California Cities filed a suit challenging a shift of $130 million in vehicle license fee money from cities to counties to pay for realignment, the criminal justice overhaul engineered by the governor to reduce the prison population. (SF Chronicle)
Now, there is still a long way to go on this, and the AG's office is defending the budget in court. The question now is if any of these succeeds, most importantly the education funding suit, does the rest of the budget explode?
Oh, yeah, there's one other thing, we're definitely on track to get nowhere near the revenue Gov. Brown anticipated for the triggered cuts. The trigger looks to be cocked.
Internet retailer ends long stalemate with California
by Brian Leubitz
You may have noticed that in the article below, I have an Amazon.com link to a book about a horse. Which, mostly I just found kind of cute, but tangentially related to the story. But, why Amazon, you ask? Well, remember that deal I mentioned a few weeks back, well, it's official and Amazon has reopened their affiliate program to Californians.
Gov. Jerry Brown signed legislation Friday that postpones new sales taxes rules that would have affected online purchases in California, granting more time for traditional and online retailers to lobby Congress for a national standard on the high-stakes issue.
The bill, crafted as a compromise among Amazon.com, traditional retailers and California lawmakers searching for ways to raise revenue, delays until at least September 2012 online tax rules that were implemented as part of this year's state budget package.
*** **** ***
Under the deal, the retailing giant will rekindle its relationship with its California affiliates and has promised to create at least 10,000 full-time jobs and hire 25,000 seasonal employees in the state by the end of 2015.(AP)
So, you can now go back to wondering whether the Amazon tablet will be the iPad killer and getting free shipping. That being said, buying in local, independent stores is still your best choice for economic development in your own community.
The Republicans and the Democrats, at least in the venue I know best, California, have a very different relationship with their respective bases. The Democrats raise money from their activist base, gets volunteers, and then generally ignores them. The Republicans, well, it is a very different story. Sure they get money and volunteers, but the tail wags the dog. The right wing activists of the Republican party controls them.
As a long-time blogger, I suppose I have a bigger megaphone than most. However, I have nowhere near the power (nor earning power) of Jon Fleischman, my right-wing counterpart at the FlashReport. He says something, and all of a sudden, legislators are looking around to make sure that they didn't cross him. Me, well, sometimes I get an "attaboy" when I am of some use, but let's just say that Calitics isn't lucrative, and that nobody is calling me a horseman of anything but the cartoon variety http://1.bp.blogspot.com/_dj0Q...
So, it is interesting, that, in an interview with CalBuzz, Governor Brown called out the Republican base as the proverbial tale wagging the Republican party.
Invoking the infamous symbols of Conquest, War, Famine and Death from the Book of Revelation, the former seminarian identified the anti-tax fearsome foursome to whom the Republicans submit as 1) DC anti-tax crusader Grover Norquist; 2) Jon Coupal of the Howard Jarvis Taxpayers Association; 3) LA radio spewers John Kobylt and Ken Champiou and 4) FlashReport, GOP operative Jon Fleischman's right-wing blog.
"It's emotionally quite wrenching for any of the Republicans to embrace anything opposed by the Four Horsemen of the Tax Apocalypse," Gov. Gandalf told Calbuzz. "If that group, or even maybe any one or two of them, invoke the dreaded 't' word, they do cower."
Of course, this is really nothing new. If you've taken a bit of time to really consider the California right-wing over the past two decades, it doesn't take a PhD in political science to see their slide from pragmatic dealmakers to ideological extremists. Jerry likely knew this before he retook the Horseshoe, but perhaps the breadth and depth of this takeover took him by surprise.
To be honest, in many ways, the right-wing has more power over the Democratic Party than the left-wing base. Under the 2/3 rule, revenue legislation must be tailored to hold all of the conservative Democrats. Nobody can take a walk, even if we did have the 2/3 Democratic chambers that we have been lusting after for so long.
Fleischman has a post today excoriating former Senate minority leader Dave Cogdill for agreeing to temporary sales tax increases. He states, and perhaps daydreams, of what California would have looked like if we had a 2011 budget in 2009. And the thing is for Fleischman, perhaps the world may have looked slightly better.
But that is only if you are doing well. After all, California (and the US in general) is a great place for those who are doing well financially. But ask those Californians who are alive today because they got a helping hand from state services, and you would see a very different picture of that 2009 vs 2011 budget debate.
Of course, the fact that the Rich need the state is hardly reported. But California without the economic engines that are the UCs, CSUs and the community colleges is a markedly different (and worse off) state. A California without the public infrastructure is a worse off state. We all need the public goods that only the state can provide efficiently. Denying that might be convenient for the Right, but it is devastating for California.
Governor somehow maintains strong plurality of support
by Brian Leubitz
In the latest Field poll (PDF), somehow Gov. Jerry Brown has managed to maintain a plurality of support. His September numbers are actually slightly better, from 46 to 49 % approval from June. Despite lying down in the stink that is Sacramento politics right now, it seems the putrid stench seems to linger on the Legislature rather than in the Horseshoe.
To some extant, he is getting an "independence" streak. Although, I'm not sure this is the quote that he would like to describe that:
Bower, a Democrat, said he found Brown a "little flaky" last time he was governor, but he thinks Brown is more focused now that he is 73 and in his third term.
"He's one foot in the grave and the other on a banana peel," Bower said. "He doesn't have a thing to lose. ... I think he just kind of tells it like it is."
Brown likely is benefiting from that image and, among other things, from the popularity of a series of symbolic measures he used early this year to demonstrate his frugality in the state's budget crisis, including recalling thousands of state-issued cellphones and cars. (SacBee)
Ah, yes, the most famous of poll bounces, the "almost dead" bounce. And it seems right that people give Brown a bit more slack for trying to work with what the people consider an ineffective Legislature. Points for trying, I suppose. However, at some point, Brown will need to push some substantial initiatives through this reticent Legislature with a 2/3 majority. And that's when things get really tough.
For the time being though, Jerry's in some smooth sailing.
Governor makes quip, Democratic Legislators get nervous
by Brian Leubitz
Well, we've completed a full legislative session with a Democratic governor, so folks had great hope that we could finally get some legislation that had gone to die on Governor Schwarzenegger's desk might stand a chance with Governor Brown.
But Jerry Brown, ever the mercurial sort, had some bad news for those legislators and groups with legislation landing on his desk: get ready to sing the "veto blues":
"I'm going to veto a lot of bills over the next 30 days," Brown told reporters after an event to reward schools with high physical fitness achievements.
"So I have to say to some, fasten your seat belt cause this is going to be a rough ride. They've given me 600 bills and there's not 600 problems that we need those solutions for," he said. ...
The governor declined to say whether he would sign or veto specific bills, but he added, "You'll hear soon enough. I think they'll be playing the veto blues before we're finished." (SF Gate)
While he was coy about specific bills he did say that his response to the state aid for the "dreamers", students who were brought to California by their parents without documents, but graduated from California high schools, was to consider the song "California Dreaming" by the Mamas and Papas.
In looooong session, Jerry Brown is unable to muster 2 GOP votes
by Brian Leubitz
If you are like me, and follow a lot of Capitol reporters on twitter, you will see a slew of tweets ending around 2AM last night. That would be because that is when the Senate finally closed its day and finished up this Legislative session.
But through all that, Brown's big last-minute goal went down in the Senate:
Gov. Jerry Brown's corporate tax package failed to clear the state Senate in the final hours of the legislative session.
The plan, contained in Senate Bill 116, fell five votes short of passage, by a final tally of 22-15.
The Democratic governor had proposed changing a corporate tax formula to require that multi-state companies calculate their tax liability based on the portion of sales in California. The roughly $1 billion expected to be raised annually through the change, mostly from out-of-state companies, would have been directed to specific tax breaks, including a sales tax exemption on manufacturing equipment. (SacBee)
The Governor wasn't even able to hold all the Democrats and one (I'm trying to figure out who) actually voted no. The question now for Brown is how he gets anything done with a Republican minority that understands their one (and only) power to block revenue legislation. But, of course, even if the Senate is 2/3 Democrats next year, we now know that is no guarantee of anything.
Governor looks to secure two Republican votes for tax changes
by Brian Leubitz
Well, step one for Jerry Brown is complete, as he got 2 Republican votes in the Assembly, but the job is far from complete.
The Democratic governor's revised tax plan raises about $1 billion in corporate taxes, mostly from out-of-state companies, and redirects that money toward tax breaks for California businesses and individuals.
He enlisted two Assembly Republicans to support the package, but he still must find votes from at least two reluctant Senate Republicans for his plan. The Legislature is scheduled to close its regular session tonight.
Brown and lawmakers hailed the plan as a jobs creator, though they offered few projections on its economic stimulus impact. Brown was joined at a news conference by GOP Assemblymen Nathan Fletcher and Cameron Smyth, who voted Thursday evening to put the legislation, Assembly Bill 1X 40, over the top in the lower house. The measure passed on a 54-10 vote, with the bare minimum for the needed two-thirds majority. (SacBee)
Sen. Dutton is apparently not ok with taxes being raised on anybody, even if the taxes are just being shifted. Apparently taxes on any one person can only go down in the world of Sen Dutton, and then proceeded to call for a special session to review the measure beyond Friday. Because then, you know, he could stall it forever and make sure nothing happens. That's kind of his deal, don't you know.
The likely targets for this measure will be Sen. Cannella, maybe Sen. Aanestad, and whomever else Jerry can drag along for the ride. 2 votes is doable, but certainly will take much arm twisting.
To avoid ballot fight, State to agree to deal with the online giant
by Brian Leubitz
Amazon had put up over $5 million in a show of force for a potential referendum. But, they never really wanted to go to the ballot. And it looks like both parties avoid an expensive ballot fight with an agreement scheduled to be finalized before the end of session:
Under the handshake deal, Amazon won a delay until at least September 2012 but will eventually collect state sales taxes.
The arrangement could lay the groundwork for a national online sales tax law. Amazon and major brick-and-mortar retailers like Wal-Mart and Barnes & Noble agreed to lobby Washington over the next 11 months for an Internet sales tax law that applies across 50 states. ...
If no federal deal emerges by July 31, 2012, Amazon would have to begin collecting California sales taxes starting on Sept. 15, 2012.
State lawmakers intend to pass a new bill in the next two days that would delay implementation of the online sales tax law until that date, according to Calderon and several sources. If Congress strikes a deal by July 31, 2012, online retailers would begin collecting taxes starting on Jan. 1, 2013, under whatever federal requirements are approved.(SacBee)
While the governor has previously said that he's not really all that excited about a deal with Amazon, given that this was negotiated by the Senate leaders, it would seem hard to block.
The bigger issue is how are we going to deal with the $200 million hole this blows in the budget. And the fact that we basically only get a promise to lobby for a sales tax measure? Well, that and a quarter might be able to get you a gumball.
But the reality is that Amazon wasn't going to collect any sales tax anytime soon. And were they to collect and submit the signatures, the law wouldn't go into reality until approved (if approved). So we are essentially dealing with a bunch of posturing. Amazon knows that they are going to have to collect sales tax at some point and are hoping to delay it as long as possible. And oh, sure, it wouldn't hurt to have one national standard.
With Amazon and the big retail giants on board, there is likely to be significant movement on the bill. We'll end up getting money into the system at some point by 2013, and we can stop messing with this fight. Covering another $200 million, well, that won't be so easy.
