Notebook: Taxes, Maps, Parallel Universes
If there's one sure way to get a reporter's attention, it's to amend a contentious piece of legislation with so many new proposals as to make it a symbolic rallying cry... and... a candidate for political squeeze play of the week.
That's how SB 116 now reads, a taxation/jobs/budget smorgasbord and one of several items worth a look in this week's Reporter's Notebook.
Business Tax Changes! But Wait, There's More! Even in its original form, SB 116 by state Sen. Kevin DeLeon (D-LA) was a noteworthy bill.
At its inception, the bill sought to rework one of the 2009 budget deal's most controversial elements: the inclusion of a new, and controversial, way of calculating the tax liability of corporations. That method, which kicked in on January 1, allows multi-state companies to choose one of two different ways to calculate their tax liability -- thus offering the corporations a chance to pick the one that results in a smaller tax bill. The choice is an annual one, meaning the corporation could pick one tax formula in 2011, the other one in 2012, and so on.
DeLeon's bill, trying to essentially do what a Democratic/labor November ballot measure failed to do at the polls, would kill the 2009 budget provision. Instead, SB 116 would make the "elective" single sales factor (SSF) tax calculation mandatory.
That part of the bill, which the Franchise Tax Board says would add $1.3 billion in revenue this year, remains the same as it was. It's also a change that was recommended last year by the nonpartisan Legislative Analyst's Office.
But on Thursday, DeLeon added a panoply of other proposals to SB 116. The bill now also offers a sales tax reduction on manufacturing equipment; an expansion of a tax credit for businesses with no more than 50 employees; and a new tax break for taxpayers who voluntarily contribute money to new special funds for K-12 schools and higher education (tax credit would be worth 75% of the donation). The first two changes -- tax breaks for business -- have been talked about in the Capitol, and on the campaign trail, for a long time. The two special funds for education are new; it would mean that the taxpayer who decided to write a check, earmarked for the schools, of $1000 would get a $750 tax credit... one that could be used anytime in a five year period.
DeLeon's bill is drafted as an urgency measure, thus requiring a supermajority vote (a top aide to the senator says it would have been a 2/3 bill no matter what, in light of 2010's Proposition 26). Might it smoke out some of the opponents of earlier efforts to remove the "elective" corporate tax break? After all, the bill now seemingly offers something to California-based big business, manufacturers, small businesses, and education programs... phew... while ostensibly pitting them against the large national corporations that like the 2009 budget tax break just fine, thank you.
I've uploaded a short PDF drafted by DeLeon's office that explains the bill in its current form. The bill is scheduled to be heard in the Senate Governance Committee on Wednesday, and could be on the Senate floor as soon as Thursday.Mapmaker, Mapmaker, Make Me A (Second) Map: On Thursday, prepare for another convulsion from California's political world as the California Citizens Redistricting Commission releases its second set of draft maps for legislative, congressional, and Board of Equalization districts.
As commission watchers have been noting in blogs and tweets the last few weeks (while some of us were engrossed in the state budget denouement), the commission is poised to do some pretty significant reworking of its June maps.
For starters, the citizen mapmakers have been grappling with the complicated, and controversial, issue of racially polarized voting -- instances in past elections that suggest minority voting rights need special attention in certain areas. That's been a particularly big issue for several groups when it comes to congressional districts in the Los Angeles area, and is prompting what one observer calls a "signficant shakeup" in how LA's congressional districts are drawn.
Meantime, three prominent minority groups joined forces on June 28 in presenting alternative maps to the commission, maps that they say meets both federal law and a desire to give several groups, including African Americans in LA, a better chance at representation.
And as the tension mounts -- final maps are due on August 15 -- it's clear commissioners are learning how political the process of redistricting is, no matter who draws the lines. Some have criticized their (and staff's) political/geographic bias; others have suggested that the commission has chosen to keep communities intact based more on the existence/absence of public comment than on other factors.
This one is far from over. And far from as contentious as it will get.
The Parallel Paths of Barack and Jerry: Governor Jerry Brown clearly has been a political animal a lot longer than President Barack Obama. Heck, Obama was eight when Brown won his first elected office. Still, I was struck in reading a Friday Politico piece on the debt limit fight by the following description of the President's role in negotiations, and in what might motivate him:
"At the same time, a prolonged impasse would also endanger one of the White House's most protected commodities: the Obama brand.
He ran in 2008 as the adult who would bring order to an unruly Washington, a mediator who could nudge mortal enemies to shake on something."
Remove the obvious ill-fitting words and replace them with California alternatives (Sacramento, 2010), and you can't help but see a parallel to Brown's long-running quest on the state budget, one which may appear to be over... but likely is simply starting a new chapter in a bigger Brown quest to restore California's tarnished government.
Politico's reporters go on to say that Obama is now trying to "revive what worked well in the past, appealing to independents as a president above the partisan fray and congressional food fights."
Again, switching out some words, hard to argue that Jerry Brown isn't thinking the same thing these days.