Budget +78: Back At It

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Photo: Governor's Office

Chances are that Governor Arnold Schwarzenegger's body clock is still many time zones ahead of ours -- in fact, it's already the 79th day of the state budget impasse in the countries where he spent most of the past week on a trade mission promoting California.

The question: are budget talks still just as stuck in his Friday... as they seem in our Thursday?

As I reported this morning on The California Report, it doesn't seem that much has happened since Schwarzenegger left last week. The two Democratic leaders of the Legislature each spoke once to the governor while he was overseas, and then only for brief chats. And no one seems to have come up with any way around the now familiar sticking points in sealing a $19 billion deficit deal: taxes (will any new revenue be counted on?) and reforms (will Schwarzenegger demand very specific components of his long repeated call for both budget and pension reform, or is there room for compromise?).

Photo: John Myers

The only real activity came yesterday, when more than 100 protesters demanded a rejection of further deep cuts in health and human services. They were angry, but not enough to have lost a least a little bit of the senses of humor; the event included Christmas carols with new verses... my favorite being the Winter Wonderland revamp that they called "Walking In A Budget La-La Land."

Today marks the first spate of news stories (present company included) about a new historical record for inaction -- it was September 16, 2008 that the Legislature ratified what was then the latest budget in state history. We're obviously going to break that record, which leaves us with a week from today... the record for the latest enactment (i.e., signed by the governor) of a budget in state history.

But what should be troubling to those who hope this won't go much longer is that when you look back to 2008, there was much more progress at this point.

Then, things were down to just a few remaining details, though they were important details. For starters, the 2008 budget helped set the stage for a good part of the deficit dilemma in 2010. That spending plan was full of fiscal potholes that had been filled very loosely -- not only with accounting gimmicks that weren't actual solutions, but also with elements that the voters would later reject in the May 2009 special election (lottery securitization, anyone?).

Also worth remembering: one of the reasons for the seven day gap between legislative approval and gubernatorial signature on the 2008-09 budget was that Schwarzenegger threatened to veto the spending plan without three changes -- and enhancements -- to the state's existing "rainy day fund" law. He ultimately got what he wanted... but again, it was part of the 2009 voter-rejected Proposition 1A.

If the governor is going to get those changes this time around... and he's still talking about them... the calendar is not on his side, because they have to be ratified by voters and counties start mailing out ballots in just 18 days.

Then again, maybe he could partner up with one of the candidates seeking to replace him, who has an eye on a possible special election in 2011.

Schwarzenegger and legislative leaders are scheduled to meet this afternoon, one of only a few 'Big 5' meetings this year. Here's hoping the governor has a few jet lag remedies at his disposal; it could be a long few days.

Update 7:45pm Democratic leaders emerged hopeful from the long budget meeting, saying a deal could come this weekend, though they admitted significant issues remain unresolved. The governor's spokesman sounded less optimistic, saying that Democrats are still being asked to agree to more cuts. The only certain bit of news: Schwarzenegger has officially abandoned any talk of a budget loan from the pension fund CalPERS.

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About John Myers

John Myers is Sacramento Bureau Chief for KQED Public Radio and "The California Report," heard daily on 23 public radio stations across the Golden State.

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