Tax and spend

Mar 16, 2009

"Less than a month after the Legislature approved more than $12 billion in tax increases to help bridge a $41 billion budget deficit, Democratic lawmakers have proposed more tax and fee measures they say would curb devastating cuts to state programs." Matthew Yi reports.

 

This is like a really bad rerun, isn't it?

 

"The proposals include a 25-cent fee for shoppers who use plastic bags; a tax on cigarettes to fund programs discouraging tobacco use; a $50 per ounce tax on marijuana; a higher income tax for the rich to help pay for schools; a tax on oil produced in California; and a tax on pornography."

 

As for those aforementioned budget cuts, well...

 

"California state government's full-time work force continues to grow despite Gov. Arnold Schwarzenegger's order to freeze hiring amid a historic budget shortfall," report Jon Ortiz and Phllip Reese in the Bee.

"From June 2008 to February 2009, most state agencies either increased or kept the same number of full-time employees, according to a Bee analysis of personnel data. The state also failed to lay off as many part-time employees during the crisis as promised by the governor.

"While legislators and Schwarzenegger debated how to close a $40 billion budget deficit, 66 state agencies saw a net gain of full-time employees, 35 kept the same number of employees and 55 lost employees, data from the state controller's office show.

"The overall number of full-time state employees increased by roughly 2,000, or 1 percent, excluding the Department of Forestry and Fire Protection, or Cal Fire, which always shrinks sharply outside of fire season, the figures show."

 

The Chron's Carla Marinucci looks at the California GOP infighting.

"This circular firing squad was on display last week at a "Tax Revolt" rally that drew 8,000 people to a Fullerton parking lot. It was organized by popular conservative talk show hosts John and Ken - John Kobylt and Ken Chiampou of radio station KFI in Los Angeles.

"The raucous California tea party featured such dramatics as the spearing of a likeness of Gov. Arnold Schwarzenegger's head, and the sledge-hammering of a pile of Schwarzenegger dolls, videos and movie memorabilia - even an action hero lunch box.

"The radio hosts' "fatwas" target a handful of moderate GOP legislators who sided with Democrats to end the state budget impasse. Their calls to recall those lawmakers have reverberated throughout the Republican grassroots.

"'It's becoming the fatwa party ... the Jon and Ken party,' said Hoover Institution media fellow and GOP consultant Bill Whalen.

"But while much of the activity is political fun and games, many in the nation's largest GOP organization say the political challenges are no laughing matter. With just a year to go before the 2010 midterm elections, when the California governor's seat and a U.S. Senate seat will be up for grabs, critics say the state party is nearly broke and its leadership is under the gun. Its problems and infighting, they say, threaten to divert attention and focus from winning elections."

 

The Bee's Peter Hecht profiles the attorney general's race, assuming Jerry Brown passes on reelection to attempt a gubernatorial comeback.

"Six Democrats, including San Francisco District Attorney Kamala Harris, Los Angeles City Attorney Rocky Delgadillo and four present or former state lawmakers, have filed campaign papers to run for Brown's seat.

"Two other Democrats, Facebook executive Chris Kelly and Bobby Shriver, brother of California first lady Maria Shriver and nephew of President John F. Kennedy, are flirting with joining the attorney general field.

"Attorney general is seen as the second most powerful and politically attractive office after the governorship. Its occupant has the ability to prosecute criminals, sue large corporations and weigh in legally on far-reaching social issues such as gay marriage.

"Two Republicans, 2006 attorney general candidate Chuck Poochigian and state Sen. Tom Harmon of Huntington Beach, also are eyeing the race."

 

Dan Walters finds that, along with keys to the corner office, it has become tradition to inherit budget deficits, which results in broken promises required to address the shortfalls.

"We don't know who the next governor will be. But chances are high that he or she will come into office in 2011 with a large and still unresolved fiscal headache. In fact, the Legislature's budget analyst, Mac Taylor, is forecasting potential deficits as high as $26 billion by 2013-14.

"It's something of a tradition."

 

"As California approaches another dreaded fire season, tax-weary legislative leaders have put a hold on Gov. Arnold Schwarzenegger's contentious plan to impose a surcharge on property insurance bills that could raise $278 million a year for more crews, engines and helicopters," writes the U-T's MIchael Gardner.

"The state's budget woes have taken a toll on firefighters and emergency-response teams. Cal Fire has cut staff, and layoff notices have been sent to regional chiefs working in the state's Emergency Management Agency.

"Meanwhile, officials are scrambling for federal dollars to pay firefighting bills, and lawmakers have introduced several measures that could determine how fire protection is provided and at what cost.

"Despite warnings that there isn't the appetite to ask Californians for more after a February budget deal included sweeping tax increases, Schwarzenegger is determined to pursue the 2.8 percent surcharge on property insurance bills, which would amount to about an additional $28 per year for the average homeowner.

"'The governor continues to support the need for additional resources. . . . He will work with the Legislature this year,' said Schwarzenegger spokeswoman Lisa Page."

 

The LAT's Michael Finnegan writes:  "[F]or all the anti-tax swagger and the occasional stunts by personalities like KFI's John and Ken, the reality is that conservative talk radio in California is on the wane. The economy's downturn has depressed ad revenue at stations across the state, thinning the ranks of conservative broadcasters.

"For that and other reasons, stations have dropped the shows of at least half a dozen radio personalities and scaled back others, in some cases replacing them with cheaper nationally syndicated programs.

"Casualties include Mark Larson in San Diego, Larry Elder and John Ziegler in Los Angeles, Melanie Morgan in San Francisco, and Phil Cowen and Mark Williams in Sacramento.

"Two of the biggest in the business, Roger Hedgecock in San Diego and Tom Sullivan in Sacramento, have switched to national shows, elevating President Obama above Schwarzenegger on their target lists.

"Another influential Sacramento host, Eric Hogue, has lost the morning rush-hour show that served as a prime forum to gin up support for the recall of Gov. Gray Davis. Now he airs just an hour a day at lunchtime on KTKZ-AM (1380).

"'It's lonely, it's quiet, and it's a shame,' Hogue said of California's shrinking conservative radio world. 'I think this state has lost a lot of benefit. I don't know if we can grow it back any time soon.'"

 

The LAT's Evan Halper reports that the tax on alcopops isn't producing the expected revenue.

 

"The sugary beverages had long been taxed as flavored beers. But state authorities reclassified them as liquor, raising the levies on a six-pack by a factor of 16 to match the rate consumers pay on vodka, rum and other distilled spirits. The move was supposed to generate $38 million in annual revenue for the state.

"Now the numbers are in: The state has collected about $9,000 since the new tax rate kicked in Oct. 1. Some officials and activists suspect fraud.

"Beverage makers admit they aren't paying the new taxes. They say they don't have to because they have reformulated the drinks -- more than 6,000 varieties -- to transform them into simple beers by limiting the amount of distilled spirits they contain.

"They won't explain how. The formulas, they say, are trade secrets. And beverage-industry officials and federal regulators say there are no tests to determine how much distilled spirits the drinks contain.

"A showdown is brewing between the beverage companies and state officials.

"'We have an obligation to the people of California to ensure that this regulation is being carried out,' said Judy Chu, a Democrat from Monterey Park who chairs the state Board of Equalization, which collects alcohol taxes. 'Without a verification process, the alcohol companies can claim anything they want.'" 

 

And finally, Matier and Ross tell the tale of a coffee break gone bad . "A Muni driver zipping down Sansome Street next to Levi Plaza double parks his 10-Townsend bus in front of a Starbucks and rushes inside to get a cup of coffee.

 

"There's a line, so the driver makes a scene about how he's in a hurry and should get priority service.

 

"Finally, with coffee in hand, he races toward the exit - only to plow into a glass door.

 

"The toll: One spilled cup of coffee, one broken glass door (with a greasy imprint of the driver's face), and one bloodied bus driver, who is soon being administered oxygen by paramedics and whisked off to St. Francis Hospital."