"Californians' pocketbooks would be hit in at least four ways under
a wide-ranging budget proposal that is being pushed toward a floor vote within days
in the Senate and Assembly," report Jim Sanders and Kevin Yamamura in the Bee.
"Senate President Pro Tem Darrell Steinberg and Assembly Speaker Karen Bass declined to comment on the measure Tuesday, and they
noted that they had yet to strike a final deal with
Republicans. The plan remains in flux, but both leaders
said they would hold floor votes this week.
"The proposal is designed to help ease the state's projected revenue shortfall of about $40 billion over the next 17 months and includes spending cuts and higher taxes.
"Multiple legislative sources said Tuesday that it would
raise revenues temporarily by these means:
"-- Increasing the state's sales tax by 1 cent on the dollar.
"-- Increasing gasoline taxes by 12 cents per gallon.
"-- Raising the state's vehicle license fee from the current 0.65 percent of a vehicle's value to 1.15 percent, with 1 percent going to the general fund and local law enforcement
getting 0.15 percent.
"-- Increasing the personal income tax across the board,
either by assessing a surcharge on tax liability or
increasing the tax rate.
"The sales tax, personal income tax and vehicle license
fee components would be in effect for either two years
or five years, depending upon the fate of a ballot
measure to restrict spending.
"If voters approve the spending limit, the three revenue-raising components would be in effect for five years.
If they reject the measure, the revenue would die after
two years."
Meanwhile, the governor had another grim announcement
yesterday.
The LAT's Patrick McGreevy and Michael Rothfeld report:
"As legislative leaders Tuesday moved toward a deal
that could wipe out the state's $42-billion deficit with temporary tax hikes on retail
sales, cars, gasoline and personal income, Gov. Arnold
Schwarzenegger threatened to lay off as many as 10,000 state employees if a new budget is not passed this week.
"State workers will begin receiving pink slips Friday,
absent a fiscal agreement by then, administration officials
said. The layoff process generally takes about six
months for state employees due to union rules and other
considerations, such as bureaucratic procedures the
state must follow. The move would save the state $750 million annually if the jobs are eliminated by July
1, according to Aaron McLear, Schwarzenegger's spokesman.
"'This is not a [negotiating] tactic,' McLear said. 'This is simply out of necessity. The state is running
out of money. The governor has very few options at
his disposal that he can unilaterally use to cut back
on state spending.'"
The Chron's Matthew Yi writes: "State officials continued to paint a grim picture of California's finances. State Controller John Chiang, who is delaying billions of dollars in payments this month, announced Tuesday that the state's revenue in January came in $2.1 billion short of what was expected in the current state budget."
The LAT's Eric Bailey writes on the secretive budget discussions.
"'A virtually impenetrable cone of silence has descended
upon the Capitol,' said Jean Ross on her daily blog for the nonpartisan California Budget
Project. She said the level of furtiveness that reached
a new high during last summer's long budget stalemate 'has been far surpassed.'
"Ross complained that there would be no public hearings
and no chance for input 'on major decisions that will shape California for years,
if not decades, to come.'
"Senate leader Darrell Steinberg (D-Sacramento) conceded that this 'certainly is not the preferred way to pass a budget.'
"But, he said, 'extraordinary times and extraordinary circumstances
demand an extraordinary approach.'
"Steinberg said it's difficult to get the required two-thirds vote to pass a budget 'with all of the outside interests beating down on members.'
"He and the others are willing to absorb criticism,
he said, 'if, in the end, we can get the people's business done -- and done responsibly.'"
Dan Walters looks at the history of the "single sales factor" tax cut for corporations, which may end up in the final deal.
"A day after launching her campaign for governor, former EBay Chief Executive Meg Whitman on Tuesday unveiled a sharply conservative approach to California's fiscal crisis and offered a fusillade of positions on other issues that are likely to complicate her run for office in 2010," writes Michael Finnegan for the Times.
"In a wide-ranging interview, the first-time Republican candidate's demeanor vacillated between that of a confident,
take-charge chief executive officer delivering a PowerPoint
presentation to that of an ill-at-ease novice who has studied stacks of policy binders,
but has yet to master the art of political maneuvering.
"'I don't know the answer to that question,' Whitman responded when asked her stand on school vouchers,
a perennial issue of importance to the conservatives
who dominate her party's primary.
"Views that could potentially attract or alienate all
manner of voters emerged on the subject of gay marriage.
"Explaining her support for Proposition 8, the November measure that banned same-sex marriage, she called it a "matter of personal conscience and my faith."
"But Whitman, a Presbyterian who supports gay civil
unions, said the thousands of same-sex marriages that took place last year before the
ban should be legally recognized -- a sentiment opposed by many Proposition 8 backers. Moreover, she said, gay and lesbian couples
should be able to adopt children.
"Whitman's approach on fiscal matters -- a key element of her pitch to voters -- rested on other seeming contradictions.
"At a time when California has frozen tax refunds and
halted highway construction to preserve solvency, Whitman,
who described herself as a billionaire, said the state
should not ask even those in the highest income-tax bracket to pay more.
"'One of the things which I'm sure you know,' she said, 'is that 1% of the people in California pay 50% of the taxes, right? And I am not in favor of raising
taxes on anyone right now.'"
"Anthem Blue Cross, the state's largest for-profit health insurer, has agreed to pay a $1-million fine and offer new coverage -- no questions asked -- to 2,330 people it dropped after they submitted bills for expensive
medical care," reports Lisa Girion in the Times.
"As part of a deal that the California Department of
Insurance is set to announce today, Anthem also will
offer to reimburse those people for medical expenses
that they paid out of pocket after they were dropped.
The company, a subsidiary of Indianapolis-based WellPoint Inc., estimated that those reimbursements
could reach $14 million.
"In exchange, the state agreed to drop its prosecution
of its accusation that the company broke state laws
in the way it rescinded members in preferred provider
organization (PPO) policies between 2004 and 2008."
"Republicans aren’t going to derail Labor Secretary-nominee Hilda Solis’ nomination over her husband’s tax problems, but they still have serious reservations about her
ties to labor unions," reports Manu Raju on Politico.com.
"Key Republican senators on the committee vetting the
California Democrat’s nomination say they won’t blame her for the problems facing her husband, Sam Sayyad, who paid around $6,400 last week to settle tax liens against his auto-repair company.
"But they are still exploring the congresswoman’s ties to a pro-union organization, and a vote on her nomination has
yet to be scheduled."
Meanwhile, Judy Chu and Gil Cedillo stand by and wait...
And finally, from our All Politics Is Local Files, "Snellville politics have reached a low point. Jerry Oberholtzer, the mayor of the Atlanta suburb, has been asking for police escorts to the restroom in City Hall after a verbal altercation with city council member Robert Jenkins a few months ago. Oberholtzer says he no longer feels comfortable around Jenkins.
"Jenkins says the mayor has no reason to worry for his physical safety and should only "fear me as a political opponent." The mayor has even had police Chief Roy Whitehead escort him to the restroom."
Funny, we were sure that when we saw the headline about a mayor demanding police escorts to the bathroom, it was going to be a story about Los Angeles...