March 26, 2003
| TO: | Cla Members/ Systems/ Network Contacts |
| FROM: | Mike Dillon, Lobbyist Christina Dillon, Lobbyist |
| RE: | News From The Capitol |
I. Senate Republicans Budget "Cuts Plan" Debated
Yesterday afternoon, the Senate Budget Committee met to hear a presentation of the Senate Republican Caucus Budget plan, by Senate Republican Leader Jim Brulte. The plan is entitled, "A Plan to Balance the Budget Without Tax or Fee Increases," and includes a five-pronged approach to solving the state's enormous Budget deficit, including immediate moratoriums on "anything that drives up the cost of doing business in California," a spending cap, and no new taxes. The most controversial component in the Republican's plan is a proposal to adopt 7 percent "across the board cuts," in most areas of the state Budget, in addition to accepting a good deal of the Governor's proposed spending reductions. The Senate Republicans would also honor the vehicle license fee commitment to local government, opposing any attempt to eliminate the "backfill" for local government.
Senator Brulte informed the committee that the Senate Republicans were prepared to begin the conversation about potential Budget solutions earlier, rather than later in the year. He stated that there would be a meeting with the Governor and legislative leaders in both houses today (also known as the "Big 5" leadership), and added, "There have been more Big 5 meetings in the last few months than over the last several years combined." However, insiders are still predicting a sizeable Budget stalemate this year, as some of the options currently on the table are unpalatable to both Democrats and Republicans. For example, a strong discussion yesterday took place between Education Budget Subcommittee Chair, Senator Jack Scott, and Senator Brulte regarding the Senate Republicans' proposed cuts to education. Said Senator Scott, "Education will be devastated by an additional 7 percent across the board cut. You would have to lay off 29,000 additional teachers, cut 13 school days, and eliminate summer school." Today, the Senate Budget Committee is hearing testimony regarding the Senate Republicans plan and its impact on health and welfare programs, park services, and the judicial system.
The Senate Republican plan does indicate their opposition to so called "fee increases" totaling $29 million in 2002-03 and $596 million in 2003-04, as proposed by the Governor in his January Budget. Contained in the list of fees that the Republicans would not support, is the Transaction Based Reimbursement, and a User Fee for State Administration in the State Library. You will recall that Governor Davis proposes to eliminate all $12.1 million for the TBR and would replace funding for this program with a "fee based" approached, wherein libraries would be required to charge $1 per direct loan item. Regarding the User Fee for State Administration, the Governor's proposal would require legislation "to allow the California State Library to establish user fees (via a State Library Card, as an example) to cover a portion of its administrative expenses." This would represent a cut to the State Library Administration of $3 million.
III. Assembly Subcommittee Begins Holding Hearings: PLF and TBR Scheduled for April 2
This week the Assembly Budget Subcommittee on Education Finance Number Two announced that they will hear the issues of the State Library budget, including the Public Library Foundation and Transaction Based Reimbursement on Wednesday, April 2. Today, during the subcommittee's second official hearing, Chairman Simitian noted that the hearings would be for "informational purposes only, and we will hold many items open over the next few weeks until we have a better idea of what the Governor's May Revision looks like." He added that with regard to the overwhelming Budget deficit, "We are in the worst of all possible worlds - bad news plus uncertainty. We don't know if the world is going to look better or worse in terms of the May Revise."