Think globally, take locally

State Treasurer Bill Lockyer lashed out at lawmakers again Thursday, warning of dire consequences of a protracted budget standoff.

The Chron's Matthew Yi reports, "State Treasurer Bill Lockyer issued a dire warning on Thursday that California's plummeting credit rating could halt thousands of critical public works projects - such as the construction of roads, levees and schools.

With everyone focused on education, many groups who thought they might be safe a couple of weeks ago are now realizing they're going to take a budget hit, if and when we ever get a deal.  Among the groups that are going to be hit will be local governments.

"California cities and counties will take a multibillion-dollar hit to help close the state's massive budget gap," The Bee's Jim Sanders reports. 

"Bolstering state coffers with local government funds would replace revenue lost by killing proposals to hike taxes on cigarettes, impose an oil extraction tax and raise vehicle registration fees to bankroll state park.

"A three-pronged revenue package totaling more than $4 billion this year from cities, counties and special districts is the acknowledged choice within budget negotiations according to multiple sources familiar with the talks.

"Senate Republican leader Dennis Hollingsworth is pushing an alternative idea, involving borrowing against redevelopment funds, but it likewise involves local government."

That's the stuff most of the negotiatiors can agree on. The sticky question still seems to be how to repay schools. It boils down to this: Gov. Schwarzenegger is willing to promise that, over time, schools will be paid back $11 billion or so that they won't get in funding. Democrats and education groups want more than a promise -- they want a Constitutional guarantee.

The LAT's Eric Bailey reports the current problem is showing the limitations of the formula that determines school funding.

"Proposition 98, the law that guarantees public schools roughly 40% of general fund revenue, is being tested as it has been only a few times before.

 
"Schwarzenegger has talked of suspending Proposition 98 and has reopened a battle with the law's guardian and protector, the powerful California Teachers Assn. Both sides have waged war over the airwaves for the last week, with dueling TV commercials typically not seen in a nonelection year."

Mike Zapler bravely attempts to explain the problem in English.

"Schwarzenegger says he favors repaying schools the $11 billion they've lost. But he opposes doing so in a way that would commit the state by law to a higher funding level for schools going forward. Instead, he's offered to support stand-alone legislation promising repayment, without writing a more permanent change into Proposition 98. Such built-in funding commitments, an aide to the governor noted, are partly responsible for the state's budget problems.

"All of the sudden we were asked yesterday to change the (state) Constitution," Schwarzenegger told reporters, "and to commit ourselves to future spending. And I said we are not going to do that."

The Democrats and the teachers union, by contrast, argue that tweaking Proposition 98 as part of the budget agreement is the only way to assure schools are made whole from recent budget cuts. The governor's way, they say, would be difficult to enforce and leave the state exposed to a court challenge from taxpayer groups opposed to more spending, which could potentially cost schools billions of dollars.

"Our position is very clear: When times get better, we want to guarantee that education gets paid back the money, that kids receive the money that they are owed," Senate President Pro Tem Darrell Steinberg said late Wednesday after negotiations stalled.

Further complicating matters is the tense relationship between the teachers association and Schwarzenegger. In 2005, the teachers led a successful drive to defeat a slate of ballot measures the governor sought to reform state government — a stinging defeat that effectively ended his early honeymoon with voters.

The governor and teachers association have gotten along well enough since then. But angered by Schwarzenegger's recent proposal to suspend Proposition 98 — an idea he's since dropped — the teachers association this month launched a $1 million-plus TV ad campaign blasting Schwarzenegger over his record on public school funding."

Get it? Got it? Good. Moving on...

The LAT's Shane Goldmacher reports, Gov. Arnold Schwarzenegger on Wednesday appointed Jerome Horton, a business-friendly former Democratic lawmaker, to the state tax board.

"The choice is likely to shift the balance of power on the Board of Equalization, which, despite its low public profile, holds broad influence over corporate taxes.

Horton's appointment is a coup for California's business lobby, which has regular dealings with the board."

STOP THE PRESSES! Turns out there's brown grass in Golden Gate Park! Somebody do something quick!

Really guys?

Also from Planet San Francisco, a local fundraiser is trying to raise money for police dogs to have bullet-proof vests.

"There are 200 police dogs in the Bay Area, but only half of them have bulletproof vests," Merideth May reports.  "The custom-fit vests are $1,700 apiece and are too expensive for most beleaguered police department budgets.

"Michael Levy, former police dog trainer and founder of the San Francisco-based Pet Food Express, will donate all the proceeds of in-store self-service dog washes this Saturday to the Western States Police Canine Association to buy vests for police dogs.

The fundraiser will be held at all 34 Pet Food Express stores, from Petaluma to Carmel.