Budget +40: No, No, Oh All Right
No actual news to report on a new state budget --shocked, aren't you? -- but three other stories all with a tie to the state's tenuous finances are out there tonight: a win for state workers facing another furlough Friday, a win for supporters of making the budget easier to pass, and a seemingly reluctant thumbs-up from legislators to delaying voter consideration of $11 billion in water system-related borrowing.
State workers likely breathed a sigh of relief after a late afternoon stoppage of this week's furloughs by Alameda County Superior Court Judge Stephen Brick. It's worth noting that Governor Schwarzenegger is already promising an appeal, so the workers impacted shouldn't start spending the money they plan to earn on those three days a month.
Still, Brick's ruling is a good read, especially in the complete smackdown it offers of the Guv's rationale that the state needs to cut back on spending immediately:
Respondents' motivation to save cash through the furloughs, among many other programs, in order to make less likely the need for the State to issue warrants in payment of bills, and in order to preserve the State’s ability to borrow money externally when needed, is understandable. However, Respondents have failed to show that the $80 million to $110 million likely to be saved through implementation of the proposed furloughs between now and a decision on a preliminary injunction will accomplish its purposes. Put another way, it appears just as likely that the State’s financial woes will continue – at least until a new budget has been adopted by the Legislature and signed by the Governor – whether the proposed furloughs are allowed to be implemented on August 13, 2010 or not.
The governor, though, is undeterred. "As long as the Legislature fails to produce a budget and the state faces IOUs," said his spokesman, Aaron McLear, in an email, "we will do what we must to reduce costs, just as every California family and business is doing."
Meantime, backers of the November ballot measure that would lower the legislative threshold for passage of a budget to a simple majority in each house also are celebrating a court win. The state's Third District Court of Appeals threw out last week's lower court ruling that amended title and summary language for Proposition 25. At issue: whether voters should be told that the measure "retains" the two-thirds legislative vote requirement for raising taxes. Sacramento Superior Court Judge Patrick Marlette ruled in favor of Prop 25 foes last Friday, striking that language due to what he said was a likelihood it would mislead voters who favor that law into thinking they had to vote for this measure if that law is to stay in place.
To which the appeals court said, um, no:
...the Attorney General reasonably concluded that stating Proposition 25 retains the two-thirds majority for raising taxes is necessary to provide voters with an understanding of the potential impact of the measure...
And if that wasn't enough, the appeals court also gave Prop 25 supporters a new quote to rehash during the campaign when the opponents argue (as they already have) that the initiative contains an intended loophole making it easier to raise taxes. "We find nothing in the substantive provisions of Prop 25," said the appeals court, "that would give a green light to the Legislature to circumvent the existing constitutional requirement of a 2/3 vote requirement to raise taxes."
Prop 25 opponents say they are disappointed, but that's about all they can do. The appellate court ruling came just as the Secretary of State's office was sending ballot items to the printer; the ruling can be appealed, but the ballot guide will already be printed with the debated sentence included.
And finally, in another chapter of late night legislative dramas, the Assembly gave the final legislative blessing to striking the $11.1 billion water bond Proposition 18 from the November ballot. Senate passage of the bill earlier in the day came much faster than the lower house cliffhanger; the last few arms were twisted and the measure squeaked by on the needed 54 vote supermajority. Governor Schwarzenegger has already said he'll sign it, and so no big borrowing proposal is headed to voters this fall.
The Assembly debate seemed to make clear that there's no true consensus as to why the bond is being delayed; some argued that polling shows voters won't approve the plan, while others said the delay is needed for more fine-tuning to be done (and one significant change was included in tonight's bill). Bottom line: this was a proposal that was the result of intense political and policy fights, and the longer it sits in limbo, the longer the odds seem to become for the deal as it now exists. The shelf life of many of the Capitol's recent compromises is not very long.
Now, back to our budget wait...