Today's new analysis of the governor's budget initiative from Legislative Analyst Elizabeth Hill will likely be read as reinforcing some of the arguments made by both supporters and critics. But it also highlights the fact that the initiative leaves some important questions unanswered.
You can read it for yourself here.
First, the "told you so" elements of this new analysis of Proposition 76. Supporters will likely point out that the LAO reaffirms the belief that Prop 76 would "smooth" out state spending over time, making changes from year to year more predictable. The analysis also concludes that giving the governor new powers to alone resolve budget impasses "may provide incentives for on-time budgets."
Critics of Prop 76, however, will point to the new analysis' conclusion that the initiative will reduce state spending in the long run because it may "prove difficult" for the state to stash away enough extra money in good years to cushion the blow in bad years. That's because downturns in recent history were sharper than any modestly growing reserves could offset. And if lawmakers were then forced to slash spending, Prop 76 requires that lower level of spending to be the new template for the future.
But the LAO analysis also highlights how Prop 76 isn't clear on some key questions.
For example, the state currently collects tax dollars in special accounts that are actually earmarked for local governments. Now, let's say the economy booms. Under the current system, local governments get their share of that extra cash.
But Prop 76 says that any revenues above the new spending limit must be held in reserve... so local governments wouldn't get all of the money they are currently entitled to. And the LAO says Prop 76 is vague, in general, about how the source of the extra revenues impacts the system as a whole.
Another example of murkiness used by the LAO: if the governor were to solve a budget impasse by cutting spending, then would any program trimmed back effectively shut down when the well runs dry? The LAO uses welfare grants as an example: an 8.3% cut in the program might mean that recipients would not receive any cash for an entire month.
Granted, this is a wonkish debate... but it's one the voters are being asked to settle, and you're not likely to see much of this in a 30 second TV ad.
An update to an earlier posting...
Late today, Assembly Speaker Fabian Nunez (D-LA) returned contributions to his ballot initiative committee from fellow Democratic legislators... contributions that the state GOP argued were above the legal limits for contributions from candidate committees. Republican attorneys filed a complaint on the issue with the FPPC.
The earlier story from today is here.
Governor Arnold Schwarzenegger has made good on his pledge to veto several high-profile bills from Democratic legislators, including the hot-button issue of same sex marriage.
The governor's office announced today the vetoing of 52 bills, including AB 849 by Assemblymember Mark Leno (D-SF) to remove references to gender in a portion of state law dealing with marriage.
Schwarzenegger's rationale-- that the bill conflicts with the anti-gay marriage Proposition 22-- has been well-known for months. And in his veto message, he seemed to be sending a message that his decision was based only on that law.
"I believe that lesbian and gay couples are entitled to full protection under the law and should not be discriminated against based upon their relationships," he wrote. "I support current domestic partnership rights and will continue to vigorously defend and enforce these rights and as such will not support any rollback."
And to seemingly back that up, the veto announcement was paired with news that Schwarzenegger signed two bills that focus on domestic partnership rights, SB 565 (Migden) and SB 973 (Kuehl).
The governor also vetoed AB 48 (Lieber) to raise the minimum wage by $1 over 2 years; AB 73 (Frommer) to create a state website listing cheap prescription drugs outside the U.S.; and AB 13 (Goldberg) to ban racial mascots at public schools.
And Schwarzenegger scrapped SB 18 (Ortiz), a bill that would have allowed for an official state audit of the new stem cell research organization created by Proposition 71. The bill passed out of the Legislature on a bipartisan vote, but the governor maintains that the audit provisions would violate provisions in Prop 71 that protect certain information on how the new stem cell organization will conduct business. Critics maintain those protections will keep state taxpayers from fully knowing how their money will be spent.
That's how long it took the pharmaceutical industry-financed team behind Proposition 78 to provide reporters today with a study that draws a completely opposite conclusion to a study being hawked by the health access and union advocates behind Proposition 79.
Welcome to the prescription drug initiative spin zone.
At 10:44 am, the first e-mail landed, with the headline "New Report Finds Maine's Enforced Prescription Drug Program Offers Deeper Discounts Than Ohio's Voluntary Program." The e-mail was distributed by Consumers Union, but actually refers to an organization headed up by a woman named Sharon Anglin Treat.
And who is Treat? She happens to be the former Democratic leader of the state Senate in Maine who authored the prescription drug legislation being touted as more effective. Her new non-profit agency's report concludes that Maine's program (upon which Prop 79 is based) is better than one instituted in Ohio (upon which Prop 78 is based), because of the "quality of the price discounts, the number of eligible residents enrolled, and the overall design and implementation of the program."
83 minutes later, the counterattack e-mail arrived: "Survey Shows Drug Prices Lower In Ohio Than Maine." The e-mail was distributed by the PR firm working for the Pharamceutical Research and Manufacturers of America (PhRMA). The study they quote was conducted by a group called Californians For Affordable Prescriptions.
And who are Californians For Affordable Prescriptions? That would be an initiative campaign set up and funded by PhRMA. They claim that a side-by-side comparison of Maine (Prop 79) and Ohio's (Prop 78) prescription drug programs concludes that Ohio's prices are 20% lower than those in Maine.
If that wasn't enough spin, the Prop 79 folks just sent me another e-mail at 2:44 pm... this one now proclaiming that PhRMA's study is "flawed."
I'm waiting for another counterattack.
The state Republican Party has accused Assembly Speaker Fabian Nunez (D-LA) and five other Democrats of breaking campaign finance rules, by shifting large sums of money from candidate controlled committees to a ballot measure committee.
The complaint was filed yesterday with the Fair Political Practices Commission. In essence, it rests on the GOP's assertion that committees controlled by a legislative candidate can't accept or donate amounts in excess of the $3300 contribution limit. And the complaint says that Nunez's new committee formed to fight Governor Schwarzenegger's initiatives has done just that.
Nunez recently created a political committee known as the Committee To Protect California's Future, opposing Propositions 74, 75, 76, and 77. State campaign finance records show that contributions to the committee have been made by Assemblymember John Laird (D-Santa Cruz), Assemblymember Dave Jones (D-Sacramento), Assemblymember Lloyd Levine (D-Van Nuys), and former Assembly Speaker Herb Wesson (D-LA). Those contributions have ranged from $15,000 to $25,000 each.
Assemblymember Karen Bass (D-LA) has also contributed $25,000 from her campaign account; she, however, is not named in the complaint.
In the letter to the FPPC, GOP attorney Charles Bell claims that the rules established by both Proposition 34 and the state's Political Reform Act bar such large contributions-- both being made by a legislative candidate's committee and being accepted by a ballot measure committee controlled by a candidate.
That last assertion... about a candidate controlled committee's ability to accept large contributions... is especially interesting, given that Governor Schwarzenegger won a court victory earlier this year to remove contribution limits for his ballot measure committee, the California Recovery Team.
There are a lot of political operations out there gearing up for this special election, and that includes the two major political parties in the state... which have each raised about $6 million through the first 8 months of the year.
But new campaign finance reports seem to indicate that going into the fall season, Democrats were sitting on a lot more cash than were Republicans.
California's Democrats raised almost $6.3 million in January-August period, and reported having a whopping $6.1 million in cash sitting in the bank. Golden State Republicans raised almost as much in the same period-- $6.1 million-- but only had $752,000 left in their coffers at the end of August.
Some other items of note in those finance reports...
* Mortgage lender Ameriquest may be a big supporter of Governor Schwarzenegger, but the company is also making nice with Democrats. Ameriquest has given Dems more than $427,000 this year, while Dawn Arnall-- wife of Ameriquest owner (and new US Ambassador to the Netherlands) Roland Arnall-- has written checks worth $250,000 to Team Arnold. Incidentally, that big chunk of change might explain why Ameriquest has only given the state GOP $55,000.
* Hollywood movie producer Stephen Bing has contributed $200,000 to the Democrats, half of which was $100,000 worth of stocks.
* The California GOP has written some IOUs to help fund its activities this year, including a $75,000 loan from the campaign of Senate GOP Leader Dick Ackerman (R-Fullerton) and a $300,000 loan from Central Valley businessman Alex Spanos.
Cindy Tuck didn't get the job she might have wanted with the Schwarzenegger administration... but it turns out she did get a different administration job.
You'll remember Tuck was the governor's choice to lead the California Air Resources Board and was rejected by the Senate earlier this month, after criticisms about her past lobbying efforts on behalf of oil and gas companies.
This afternoon, Tuck was appointed as assistant secretary for policy at the state Environmental Protection Agency. The gig pays $123,708 a year... and, as the press release so mildly mentions, does NOT require Senate confirmation.
That's what is on the desk of Governor Arnold Schwarzenegger as the deadline approaches for him to weigh in on the bills passed by the Legislature in the session that just ended.
The governor's press office says he received 704 bills that had to be acted on by October 9th, which is the end of the 30-day deadline for action prescribed in the state Constitution. He has signed 122 of those bills and vetoed 22 others.
Schwarzenegger is not expected back in Sacramento until this evening, but of course has a bevy of aides who are likely examining those bills for him. Many of the most high-profiles bills are still on his desk, including efforts to allow same sex marriages, increase the minimum wage, and wade into the issue of high school athletes and performance-enhancing supplements.
We'll keep an eye on which ones get signed, and which get sacked.
One of the highest ranking advisers to former Governor Gray Davis is heading back inside the "horseshoe" offices of the governor, as chief of staff to First Lady Maria Shriver.
Daniel Zingale served in a number of high profile jobs for Davis, including as his cabinet secretary and as the first director of the state's Department of Managed Health Care. This afternoon, it was announced that Zingale will become Shriver's chief of staff in November.
Just before leaving office, Davis appointed the 45-year-old Zingale to a six-figure paying job on the Agricultural Labor Relations Board... and Zingale was one of the appointees that in 2004 the Schwarzenegger administration said could no longer work from home.
Zingale was also the target of a lawsuit from a citizen who said that it was improper for Zingale to have worked on a political campaign last year while also drawing a state salary.
Zingale now becomes one of the most high-profile Democrats now working inside the Republican administration... although his job is with the #1 Democrat in the governor's camp: his wife.
This morning's legislative hearing on the union dues initiative Proposition 75 may have been billed with milquetoast heading of "informational", but it played out as a knock-down, drag-out political brawl.
Majority Democrats, who politically have the most to lose if Prop 75 passes, quickly came out swinging. Especially heated was the prolonged exchange with some of the key players behind the initiative: Lew Uhler of the National Tax Limitation Committee, Jon Coupal of the Howard Jarvis Taxpayers Association, and Lance Izumi of the Pacific Research Institute.
Democrats attempted to turn the tables, by demanding information on the donors to some of these organizations, and asking whether these donors give permission before any political advocacy is undertaken. They also repeatedly asked why Prop 75 is necessary, if workers can already opt out of having dues go towards political efforts.
Particularly notable was an exchange between Uhler and Senator Richard Alarcon (D-Van Nuys), one of the co-chairs of the hearing. Uhler had said that many of the questions weren't relevant.
"We were elected, not you," shot back Alarcon. "And we'll decide what's relevant to this committee."
Uhler responded by saying, "What I have observed from this committee is total imbalance."
There were also interesting accusations made by both sides. Senator Alarcon stated that Prop 75 is unnecessary, because 25% of state employees already opt out of union activities. And Jon Coupal said that several employees of an LA-area community hospital have alleged that the fees they pay for non-political activities are, instead, actually being spent by their union on political activities.
The hearing was certainly more entertaining than the 30-second TV commercials... but may not have been much more enlightening.