California Budget Picture Looks Murky With Stalled Talks

SACRAMENTO (AP) — The end of budget talks between Gov. Jerry Brown and Republican lawmakers has shrouded California’s fiscal future even more, leaving officials cautious about publicly saying what options remain.

Lawmakers and Brown’s office on Wednesday would say only that they are discussing their next steps.

By giving up on talks with Republican legislators, Brown effectively abandoned his push for a June special election to renew temporary sales, vehicle and income taxes the state Legislature approved two years ago.

The Democratic governor had wanted to close the state’s $26.6 billion budget gap with a near equal amount of cuts and taxes.

Though immediate tax extensions seem to have been pushed out of the equation, California’s leading labor and teachers unions were holding out hope that state lawmakers will put a tax initiative before voters.

“We still support that approach, we haven’t abandoned that approach,” said Mike Myslinski, a spokesman for the California Teachers Association.

He said lawmakers and the governor need to get back to the negotiating table.

In the absence of a June election, the governor could also pursue a November ballot initiative to ask Californians to pay higher taxes. Democratic interest groups would need to gather and qualify enough signatures to get it on the ballot in time.

Otherwise, Democratic lawmakers would have to make billions of dollars more in cuts to programs that are already facing shortfalls.

Brown last week signed into law bills that reduced California’s deficit from $26.6 billion to about $15.4 billion through a mix of spending cuts and fund shifts, including about $7.4 billion from the state’s welfare-to-work program, services for the developmentally disabled and health insurance for the poor.

Public schools that receive more than 40 percent of the state’s general fund revenues would likely be among the hardest hit in an all-cuts budget.

Solving the remaining deficit with cuts alone is unlikely, according to a spokesman for Senate President Pro Tem Darrell Steinberg, D-Sacramento.

“We don’t think anybody in the Capitol, legislators on either side of the aisle, will stand for an all-cuts budget,” Mark Hedlund said.

But a labor spokesman said that might not be such a bad idea if it sends GOP lawmakers a message that taxes are necessary.

“After voters and constituents see what those cuts might mean, there’s a possibility for cooler heads on the Republican side to prevail,” said Steve Smith, spokesman for the California Labor Federation.

(© Copyright 2011 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.)


More From CBS Los Angeles

KNX 1070 Newsradio

Listen Live