June 30, 2004
| TO: | CLA Members/ Systems/ Network Contacts |
| FROM: | Mike Dillon, Lobbyist Christina Dillon, Lobbyist |
| RE: | NEWS FROM THE CAPITOL |
I. BUDGET UPDATE - "I KEEP HEARING I SHOULD BE HEARING SOMETHING SHORTLY."
Several months ago, Governor Schwarzenegger announced his intent to produce an "on time" Budget, meaning that the Budget would be agreed to by the legislature, and on his desk, ready to be signed by June 30th in order to start the new fiscal year on July 1. Unfortunately, a handful of final issues - including a $2.6 billion deal crafted with the cities, counties, and special districts - continue to be problematic for legislative leaders and the Governor, and will cause the state to miss the Governor's June 30th deadline today. The powerful Budget Conference Committee has not met for at least two weeks, and the so-called "Big 5," consisting of the Assembly and Senate leadership and the Governor, has met fairly regularly for the last week. It was rumored that the "Big 5" may have a handshake agreement on all remaining outstanding issues in the Budget by the end of the day today. However, this afternoon we believe it will now be tomorrow or Friday before an agreement is reached. One of the Budget Conference Committee members indicated that the Conference Committee could then convene briefly to tie up loose ends, and a Budget could be drafted and sent to the floors of the Senate and Assembly for a vote as early as Tuesday or Wednesday of next week. However, we are somewhat amazed at the lack of information that various top level staff members seem to have regarding the progress of the Budget negotiations by the "Big 5." One key fiscal staff member told us, tongue in cheek, yesterday, "I keep hearing I should be hearing something shortly."
II. DEMOCRAT RESISTANCE TO LOCAL GOVERNMENT DEAL
Several key Democratic lawmakers are still balking at the piece in the Governor's "local government deal" that would lock the current sources of local government revenues into the Constitution, specifically the sales tax and property tax. Lawmakers, like Assemblyman Darrell Steinberg of Sacramento, feel that by placing these sources of revenue into the Constitution, the State will be precluded from ever addressing issues such as "fiscalization of land use" and the need to address low-income housing. While there is some resistance to the local government ERAF piece that affects the special districts, one confidential source informed us late last week that this provision may be ultimately agreed to. As of this writing, the exemption that CLA secured for the independent special district libraries, and so-called "ERAF Orphan" libraries, is holding and we are optimistic it will not be undone at this point. Once the final agreement, relative to the local government deal is announced, we will alert you. (The language for the "deal" will be eventually incorporated into a Budget trailer bill next week and assigned a bill number, which will allow you to track its progress.)
III. CLA'S LIBRARY BOND BILL HEADS TO ASSEMBLY APPROPRIATIONS - LETTERS NEEDED
Last week, the Assembly Local Government Committee heard testimony on SB 1161 by Senator Dede Alpert. The measure is sponsored by CLA and would provide $1 billion in general obligation bonds for library construction and renovation on the March 2006 ballot. The committee received the
bill favorably, passing the measure with 7 "ayes" and zero "no" votes. (Committee members voting in support included Assemblymembers Chairman Salinas, Vice Chair Lieber, Garcia, Leno, Mullin, Steinberg, and Wiggins.) Testifying in support of the bill was Anne Cain, CLA's Legislative Chair and Contra Costa County Library Director; Anne Marie Gold, Sacramento Public Library Director; and lobbyists for Sacramento County, Alameda County, and the city of Los Angeles. At the conclusion of the testimony, Assemblyman Mark Leno (D-San Francisco) inquired, "Senator Alpert, a question.is $1 billion enough?" Responded Senator Alpert, "Thank you, Mr. Leno. Unfortunately, $1 billion is never enough, but we think it is a good start."
You may recall that when the bill was originally introduced, Senator Alpert included a $2 billion figure in her measure, and realistically knew that she would have to negotiate that figure down based on what the state could bear in terms of its bonded indebtedness capacity. In an attempt to move the bill forward and continue discussions with the Governor and the Administration, she stripped all of the funding from the measure to advance the bill out of the Senate. Once the bill was in the Assembly, the Senator requested that CLA lobbyists join her on June 16th in a special meeting with the Governor's Chief of Staff and the Governor's Secretary for Legislation to discuss the future of the bond bill. Originally, the goal was to place a library construction bond on the ballot for November 2004. However, after a very informative and helpful meeting with the Governor's two representatives, they have cautioned the Senator against proceeding with the bond on the November 2004 ballot. They noted that the November ballot is so "lengthy, that you may face voter fatigue. We think the voters may get frustrated with all of the items on the ballot." In addition, they noted that the state continues to sell $15 billion worth of "debt repayment bonds" that the voters approved in March of 2004, as part of Governor Schwarzenegger's Budget recovery plan. Thus, while they did not indicate whether the Governor would support or oppose the bill, they suggested that the Senator pursue the March 2006 ballot, and a dollar amount of $1 billion. In addition, they have asked CLA and Senator Alpert to meet with the Department of Finance to determine what the state might be able to afford in terms of general obligation bond debt, and ascertain whether or not a schedule could be established to sell the bond in waves, as is being done with the debt retirement bond. The Senator promptly amended her bill to include the Administration's recommendations, and SB 1161 was fast-tracked to the Assembly Local Government only several days later. Much work still needs to be done between now and August to convince the Governor and Department of Finance that a $1 billion bond for library construction and renovation is critical.
The next hurdle for SB 1161 is the Assembly Appropriations Committee, who will consider the bill during the first week of August, when the legislature returns from its legislative recess. Please take a moment today to write each of the members of the Appropriations Committee, and urge their strong support of the bill. At the same time, we would encourage you to write the Governor, and request his support of the bond -- in your letters to the Governor, you might mention: 1) the specific need in your communities, 2) the tremendous competition due to the lack of funds in the current Proposition 14 bond, 3) since the Governor has made youth after school programs one of his hallmark issues, you might highlight some of the important programs your libraries would provide for school age children during the after school hours. Thank you for your help!
Members of the Assembly Appropriations Committee
Assemblywoman Judy Chu, Chair
Assemblywoman Sharon Runner, Vice Chair
Assemblywoman Patricia Bates
Assemblywoman Patty Berg
Assemblywoman Ron Calderon
Assemblywoman Ellen Corbett [co-author]
Assemblyman Lou Correa
Assemblywoman Lynn Daucher
Assemblyman Manny Diaz
Assemblyman Marco Firebaugh
Assemblywoman Jackie Goldberg
Assemblyman Ray Haynes
Assemblyman Mark Leno [co-author]
Assemblyman Abel Maldonado
Assemblywoman Gloria Negrete McLeod
Assemblyman Joe Nation [co-author]
Assemblyman Robert Pacheco
Assemblywoman Fran Pavley
Assemblyman Mark Ridley-Thomas
Assemblyman Steven Samuelian
Assemblyman Joe Simitian
Assemblywoman Patricia Wiggins
Assemblyman Leland Yee
Sample address:
The Honorable Judy Chu
Chair, Assembly Appropriations Committee
State Capitol
Sacramento, CA. 95814
and
The Honorable Arnold Schwarzenegger
Governor, State of California
State Capitol
Sacramento, CA. 95814