"With cars whizzing behind him along one of Southern
California’s most congested and detested freeways, Gov. Arnold
Schwarzenegger warned Monday that the state was “on a track toward disaster” as it ceases highway, school and bridge construction
because of budget and credit woes," reports Jennifer Steinhauer in the NY Times.
"California, which has suspended nearly $4 billion in public works projects, is one of a half
dozen states delaying or halting projects because of
capsizing budgets, an inability to attract investors
to the municipal bonds used to bankroll many projects
and a reduction in gasoline tax revenues — which underlie a lot of transportation financing.
"The American Association of State Highway and Transportation
Officials has identified 5,000 transportation projects nationwide that lack the dollars
to proceed; many of them, like the $730 million project here to add 10 miles of high-occupancy-vehicle lanes to the 405 Freeway — Mr. Schwarzenegger’s backdrop on Monday — have been stopped midstream.
"'They just haven’t been able to find the resources,' Tony Dorsey, the spokesman for the association, said of the halted
projects.
"More than 40 states are struggling with revenue shortfalls, and
lawmakers across the country are cutting, taxing and
pleading their way toward solvency. Fixing bridges,
expanding highways and other infrastructure projects
have faced the same fate as government entitlement
programs, state jobs and other items."
As the governor was standing in traffic, "[i]t was a day of mixed messages on California's ever-worsening fiscal mess Monday, with Gov. Arnold Schwarzenegger
and Democratic legislative leaders slamming each other
in public but still raising the possibility that a
budget deal could be done within days," reports John Wildermuth in the Chron.
"An agreement can't come fast enough. In a letter to the governor and
the Legislature on Monday, state Controller John Chiang again warned that the state could be out of cash and
paying vendors with IOUs by the end of February.
"Schwarzenegger and the two Democratic leaders are to
meet again today to see if they can put together an
agreement the governor will sign.
"Missing from [Sunday's] discussion were the GOP legislative leaders. The Democratic
budget is designed to cut the Republicans out of the
picture by circumventing the Proposition 13 requirement for a two-thirds vote by the Legislature on tax increases. Instead,
they would raise the needed money with a complicated
mix of tax cuts and tax hikes that balance each other
out and a new fee increase on gasoline, which only
has to be approved by a majority vote.
"The governor 'will work with any legislators who are willing to engage
in finding a solution,' [Schwarzenegger spokesman Aaron] McLear said. 'Republicans have refused to negotiate.'
"State Sen. Dave Cogdill, R-Modesto, the Senate Republican leader, and Assemblyman
Mike Villines, R-Clovis, his counterpart in the Assembly, both cried
foul at the Democratic effort.
"'It is unfortunate that the governor and Democrats are
only interested in raising taxes, not working with
Republicans to negotiate a truly bipartisan solution,' Villines said Monday. He called the proposal 'an illegal tax increase package' and suggested it 'will be tied up in court for months and even years.'"
Judy Lin reports on the back and forth of the day.
"Hopes of a Christmas budget compromise melted into
political finger-pointing by the end of the day.
"Gov. Arnold Schwarzenegger began Monday on a cheery
note, suggesting that negotiations with Democratic
leaders could lead to a budget deal as early as this
week to help close the $42 billion shortfall that is projected through June 2010.
"Yesterday we sat there for hours and we worked through
it step by step and we made some great progress," the governor said during a morning news conference
in Los Angeles. "So we feel like if we do that two more times like that,
I think we can get there ... before Christmas Eve or
Christmas Day."
"The thaw didn't last long, as legislative leaders later in the day
criticized Schwarzenegger and indicated their work
was done until the start of the new year."
Dan Walters assesses the situation.
"There was some teleconference negotiating over the
weekend, and by Monday, Schwarzenegger was optimistic
about a deal. "It could easily be that before Christmas Eve or Christmas
Day that we have an agreement, that the legislators
can be brought back between Christmas and New Year's to vote on it," he said in Los Angeles.
"So where are we, really?
"Although nothing about this mess is certain, it appears
likely Schwarzenegger and Democrats will do a deal.
The questions are whether Democrats will accept something
their allies in labor and environmental groups abhor,
or whether, despite his tough talk, the governor will
cave on his demands.
"But if they do agree, what then?
"Republicans and anti-tax groups will quickly sue, contending that extracting
revenue by simple-majority votes violates the constitutionally required
two-thirds vote on new taxes. 'It is counterproductive to be spending hours and hours
in negotiations based on the $11 billion in tax increases passed by Democrats when
they are clearly illegal and will be tied up in court
for months and even years,' Assembly GOP leader Mike Villines said."
Alright, who is playing Thelma and who is playing Louise?
Meanwhile, Democrats' core constituencies threatened a lawsuit of their
own over the governor's budget solutions. "State worker unions filed legal challenges Monday against Gov. Arnold Schwarzenegger's mandate of twice-monthly unpaid furloughs and potential layoffs next year, charging that the
governor overstepped his executive authority," reports Kevin Yamamura in the Bee.
"Despite his disagreement with unions, the Republican
governor expressed optimism Monday that he can reach
a handshake deal with Democrats on an $18 billion partial budget solution as soon as this week.
Schwarzenegger also defended his furlough-and-layoff order Monday as necessary to preserve cash as
the state confronts a $40 billion budget gap over the next 18 months.
"'Now, I hate to lay off any state employees, may I remind
you, because those are hardworking people and they
all have to provide for their families,' Schwarzenegger said in a Los Angeles news conference.
'But we are running out of cash by February, so I have
no other choice.'
"Schwarzenegger's furlough plan would not avert a cash crisis on its
own. Furloughs would save an estimated $1.3 billion over 17 months, while the state faces a $5 billion cash shortfall in March."
The same tough choices are facing the state's counties and cities. David Zanhiser reports, "Los Angeles City Controller Laura Chick called Monday
on Mayor Antonio Villaraigosa to look seriously at
contracting out services as a way of addressing the
city's budget woes.
"With a budget shortfall of $432 million expected by July 1, Villaraigosa and the City Council need to take a
hard look at such concepts as hiring private companies
to pick up trash and leasing out municipal buildings,
Chick said.
"'Nothing is too sacred for discussion and scrutiny,' she said.
Chick made her remarks as she released a report on
"public-private partnerships," efforts by government agencies to work with the private
sector. The report said the city should examine such
opportunities as leasing Ontario International Airport,
hiring a nonprofit to run the city's animal shelters and contracting out its wastewater
management.
Meanwhile, a "top state think tank Monday put a grim human toll on
the financial crisis: As the state and national economies worsen, the number of families needing government help to survive
is burgeoning," reports Karen de Sa in the Merc News.
"According to a first-ever study released by the nonpartisan California Budget
Project, state residents are turning to public assistance
in dramatic numbers. With unemployment at a 14-year high, the number of food stamp recipients has
quadrupled in the last year. Welfare rolls that shed
more than 500 families a month in 2007 now serve 2,240 new families each month. And tens of thousands are
turning to government-funded health care following job losses and a decline
in employer-sponsored benefits."
"Former Senate leader Don Perata has transferred another $400,000 to his legal defense fund from a campaign account he created to advocate for
ballot measures," reports Shane Goldmacher on Capitol Alert."
If only Blagojevich had been preparing in the same
fashion...
"The latest transfer means the Oakland Democrat has
now taken a total of $1.9 million raised in an account earmarked for ballot
campaigns and used it to shore up the legal fund he
created to fight an FBI corruption probe."
Hey, this all makes Fabian Nunez's take seem a bit better.
"The transfers are legal, though California's campaign watchdog agency is considering stricter
regulations of ballot accounts like Perata's.
"The FBI has been investigating Perata since 2004, inquiring about his business dealings and those of
his family and close friends. Both Perata's and his son's homes were raided by FBI agents four years ago."
"The race to replace Congresswoman Hilda Solis may turn out to be a competition between veteran politicians
representing the district's two largest ethnic groups: Latinos and Asians," writes Evelyn Larrubia in the Times.
"On Monday, Judy Chu, chairwoman of the state Board of Equalization, announced
her intention to run for the seat, which encompasses
East Los Angeles and the San Gabriel Valley and would
be vacant if Solis (D-El Monte) is confirmed as President-elect Barack Obama's secretary of labor.
"State Sen. Gloria Romero (D-Los Angeles) said publicly last week that she was interested in
pursuing the seat.
"Speculation over who would run has been swirling in
political circles since Obama's choice of Solis was made public late last week.
"Both Chu and Romero were suggested, as were Assemblyman
Charles Calderon (D-Montebello) and Assemblyman Ed Hernandez (D-West Covina), neither of whom have announced their intentions.
But the law doesn't require a candidate to live in the district, so the
field could be open to many other candidates for the
sought-after seat in the House of Representatives, which is
not subject to term limits. Solis' successor must be chosen in a special election."
Times columnist Hector Tobar isn't sure what to make of the outpouring of letters on
behalf of Esteban Nuñez.
"[W]ouldn't it be great if the members of the Assembly and the
mayor and the rest of our political class started falling
over themselves to advocate for the public defender's office, to get it more lawyers and maybe even an
extra laptop or two?"
Finally, from our Fire and Ice files:
"Fire officials in New Bedford, Mass., say a man using a blowtorch to melt ice on his back
porch ended up setting his house on fire, causing up to $30,000 in damage.
"Fire Capt. Scott Kruger tells The Standard-Times of New Bedford that no on was injured during
Monday's incident at the three-story home.
"Kruger says the man was using a torch hooked up to
a 20-pound propane cylinder. He got too close to the building's wood frame and ignited the vinyl siding. The fire
quickly spread into the building's second- and third-floor apartments.
"It took 25 firefighters to subdue the blaze that damaged bedrooms
in the upstairs units, and caused damage to the structure
and wiring.
"The homeowner will not be charged."
After all, the Penal Code still doesn't criminalize stupidity.
