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News from the Capitol
Budget Deal Still Elusive
Both the Assembly and Senate adjourned before noon today, and while they will remain "on call" of the Assembly Speaker or Senate President pro Tem, they are not likely to return until the regularly scheduled session on Monday. While there have been continual reports about a Budget deal "getting close," a number of substantive issues are still unresolved, relating to education funding and cuts to In Home Support Services (IHSS), and welfare programs. For example, key legislative staff members and the Department of Finance have found a way to potentially resolve one sticky issue, reducing education funding without suspending Proposition 98, a politically sensitive issue with both Democrats and Republicans. However, disagreements remain between the education community and the Governor's office relating to the so-called "maintenance factor," wherein schools, under certain circumstances, are owed money in future years for funds they were entitled to in prior years but did not receive.
As a few details leak out of the daily meetings between the Big 4 Leaders and the Governor, lobbyists and legislators begin expressing concerns about various proposals being discussed. When the "Big 5" is meeting in the Governor's office, dozens of reporters patiently wait outside, hoping to find information, sometimes to little or no avail. Occasionally, lobbyists and reporters will share tidbits of information.
Yesterday morning, we picked information up from a credible source that an agreement was near on a proposal to: 1) Borrow close to $2 billion in local government property taxes, as allowed under Proposition 1A (2004), 2) Take $1.7 billion from redevelopment agencies, 3) Take close to $1 billion in Highway User Tax funds from cities and counties. This morning, one Republican Senator told us that there was an alternative proposal being discussed to avoid borrowing property taxes from local government. Five minutes later, a key Assembly Republican told us rather firmly that property taxes had to be part of the overall budget deal. These two conversations demonstrate both the difficulty of obtaining any accurate information, and also the difficulty the legislature and the Governor have in trying to reach closure on the Budget.
We will keep you informed as more information becomes available.
Posted on July 16, 2009 3:27 PM | Permalink