State Budget Talks Going Nowhere, Slowly

SACRAMENTO —  Gov. Gray Davis has said he has no plans to negotiate with Republican leaders on a new state budget, and for the most part he has kept his word. Until last week.

Attracting a crush of television cameras, Davis met Thursday with the Assembly’s Democratic and Republican leaders for the first time since the $99-billion spending package failed to clear the lower house last month, causing him to miss a July 1 deadline for signing a new budget.

The outcome of the two-hour huddle: Assembly Republican Leader Dave Cox (R-Fair Oaks) emerged and told reporters that he would not characterize the talks as negotiations. Later in the day, GOP Assemblyman John Campbell of Irvine had one word to describe the direction talks appeared to be heading: “Nowhere.”

For their part, Assembly Speaker Herb Wesson (D-Culver City) said the meeting brought a “little bit of progress,” and Davis reiterated his belief that he had already done his part by proposing a budget. Now, he said, it was up to the Legislature to pass a plan.

And so it goes as California approaches its one-month anniversary without a state budget--a situation that is causing 2,400 legislative employees and thousands of vendors who provide the state with goods and services to go unpaid.

The list of casualties will grow this week because of a decision by State Controller Kathleen Connell to halt paychecks for lawmakers and other elected state officials, including herself and Davis, until a spending package has been approved.

Connell’s decision landed her on CNN. The cable news channel conducted an informal poll of viewers, who were asked to vote on whether Connell should suspend the pay of all elected officials for failing to balance the budget, as they are required to do.

The viewers’ response: 95% yes.

Some of the proposals state officials are relying on to help close the $23.6-billion projected shortfall are also at risk. A 63-cent hike in the state excise tax levied on cigarettes, for example, is scheduled to kick in on Thursday, but officials can’t collect the higher tax until lawmakers approve the increase as part of the spending package.

Similarly, plans to bolster certain tax collections that would generate millions of dollars to help get the state out of the red are also on hold.

Davis also contends that California’s ability to fight forest fires and help AIDS patients is in jeopardy.

The Senate approved a spending package last month, but it remains stalled in the Assembly, where Republicans are blocking it because it contains nearly $4 billion in new taxes and other new revenue.

Republicans want additional cuts to diminish the need for tax hikes, but any changes to the plan must pass muster with the Senate and with Davis.

In previous years, Davis and his GOP predecessors, Govs. Pete Wilson and George Deukmejian, held what are referred to around the Capitol as “Big Five” meetings. In addition to the governor, participants traditionally included the leading Democrats and Republicans from each house of the Legislature--the folks with the clout to hammer out big deals.

This year, however, Davis has called no such meetings as he and his staff have gone about trying to persuade any four Assembly Republicans--the minimum needed to approve the spending package--to vote with the Democrats.

Consequently, for several weeks now, Wesson and Cox have been meeting regularly with four Assembly legislators from each party, prompting one participant to jokingly dub the gatherings the “Puny 10.” With no apparent progress being made, the word around the Capitol is that the earliest time something is likely to break is when the Senate returns from its summer holiday on Aug. 5.

The lull has given rise to plenty of partisan finger-pointing but, amid the rhetoric, the status quo reigns.

Republican Assemblyman Campbell notes that Democrats have balked at billions of dollars in spending cuts that could make tax hikes unnecessary. He also contends that Democrats haven’t floated a counterproposal.

Campbell, an Orange County car dealer, used an automotive analogy to spell out what has been going on during the past few weeks’ numerous budget talks.

“You go into a car dealership and the price on the car is $30,000 and you tell the dealer you’ll pay $26,000 and he says nothing. You’re not going to go back and say you’ll pay $28,000 because the dealer hasn’t said anything,” Campbell said.

Campbell also wondered why Assembly Republicans should reach an agreement with their Democratic counterparts in the Assembly without the blessing of Senate Leader John Burton (D-San Francisco) or Davis.

“We need the governor to be a party in the negotiations and not just a person in the room,” he said.

Wesson said that, while Democrats need to respect Republicans, Democrats control the state for a reason: “The majority of Californians are in tune with the core values that we as Democrats share and will passionately fight for.”