The entire caucus of Assembly Republicans has signed onto a proposal to essentially squirrel away money for public works projects each year from the state General Fund... a "pay as you go" proposal that, if approved by voters, would be placed into the state Constitution.

ACA 27 was placed across the desk today, authored by Assembly GOP Leader Kevin McCarthy (R-Bakersfield). While it's unlikely to replace any specific amount of the $68 billion in bonds that Governor Schwarzenegger wants to float over the next 10 years, it's symbolic of Republican desires to use more existing money-- and less borrowed money-- for infrastructure needs.

The main parts of ACA 27 include:

* Beginning in the 2007-08 fiscal year, the state would set aside a "dedicated percentage" of General Fund revenues for "capital outlay" projects. How much money? In the first year, it would be 1% of the General Fund. Under current estimates for 2007-08, that would be around $960 million.

* If General Fund revenues keep increasing (by at least $5 billion per fiscal year) then so, too, would the pot of money being earmarked for capital projects. Each year, the increase to the base level of funding would be either another 1/2% of the General Fund or $750 million, whichever is less.

* The places the money could be spent would be limited to construction on UC or CSU campuses; projects in the pipeline of the State Transportation Improvement Program (STIP); or water storage/flood/levy projects.

ACA 27 may very well be a work in progress, but it represents a significant demand from Republicans in the infrastructure debate this winter and spring.

It also raises some questions that could prove thorny for the proposal as currently drafted: because the spending program, as written, could not be suspended by the Legislature-- even in bad fiscal times-- might some opponents see it as yet another expensive "budget firewall" that ultimately threatens social services programs? In addition, will there be a debate about the list of projects that the money can be spent on? GOP estimates are that the fund will add up to almost $36 billion over the next 10 years.

And most interestingly, will all 32 Assembly Republicans hold fast on their demand that a "pay as you go" proposal-- this one or a modified version-- be part of any final deal? After all, 6 GOP votes in the Assembly will be needed to get any of the governor's proposals on their way.