With just two weeks left until the start of the fiscal year, California's budget plans stalled Thursday after Gov. Jerry Brown vetoed a spending proposal by Democratic legislators, saying it was inadequate, and insisted that Republicans compromise on taxes.
"California is facing a fiscal crisis, and very strong medicine must be taken," Brown said while rejecting the budget that Democratic legislators passed Wednesday as an alternative to his plan. "I don't want to see more billions of borrowing, legal maneuvers that are questionable and a budget that will not stand the test of time."
Brown blamed Republican lawmakers for "obstructing" a vote by Californians on his plan to extend and raise taxes to balance the budget and prevent deeper cuts to education and courts. But it was Democratic legislative leaders who reacted angrily to Brown's action, saying they were "deeply dismayed."
The leaders, who spent most of the year taking direction on a budget strategy from the governor, appeared blindsided by the governor's veto, which marked the first time in California history that a governor had taken such action.
"His decision is apparently part of some elaborate strategy to force a confrontation," said Senate President Pro Tem Darrell Steinberg (D-Sacramento) adding that Brown's continual push for his budget plan "ring(s) hollow if he is unable to deliver Republican votes."
Unfazed by anger
Assemblyman Charles Calderon (D-Whittier) said Brown's veto, "prolongs the public confusion and fear that has been the shame of every budget in this state for the last 30 years."
Brown seemed unfazed by their anger. Speaking to reporters in Los Angeles, he said he remains confident that "we can do better than the budget plan that was presented to me this morning."
But he also praised the majority party for approving $10.8 billion in cuts and other measures this spring, and said if taxes aren't approved, deeper cuts to public safety and education will be the fault of the GOP.
"We're going to get something better, you can be sure of that," Brown said. "Whether I can get the Republican votes, it remains to be seen. But I'm going to give them a chance to become heroes rather than the people who are complicit in the destruction of universities and schools."
Praise for Brown
A number of groups praised the governor for his veto. They included the California Chamber of Commerce and the California State Association of Counties, which criticized the plan adopted by Democrats on Wednesday as being filled with gimmicks.
Lawmakers faced losing their paychecks if they missed the deadline for passing a balanced budget, and it remained unclear Thursday whether they will be able to collect their pay. Under the voter-approved Proposition 25, lawmakers can collect their pay if they pass a balanced budget regardless of whether the governor signs it. Controller John Chiang, who will decide whether the budget was indeed a balanced plan, issued a statement Thursday saying he is reviewing the matter. In the meantime, Chiang said, lawmakers are scheduled to receive their next paycheck on June 30.
It was also unclear Thursday whether Brown would sign other portions of the Democrats' budget package. He vetoed the main budget bills but said he has not yet decided whether to sign a number of related measures, including a controversial plan to eliminate redevelopment programs and instead create a new program that would force redevelopment agencies to give money to schools and other local programs if they want to remain in existence.
The governor did indicate he might sign a measure requiring Internet merchants to collect sales tax, saying it is "common sense" to make sure that "people who are similarly situated pay the same sales tax."
New taxing power
Brown also indicated he is leaving the door open to several controversial ideas that have been pushed by Democrats. Among them: a bill by Steinberg to give unprecedented taxing authority on income and excise taxes to counties, school districts and community college districts, along with the power to raise vehicle license fees; and an idea that Democrats and their allies have floated to aim deep spending cuts at Republican districts.
"I'm not sure it can be done on a geographic basis, and after real reflection, that I want to go there," he said when asked about targeting cuts. "But I certainly will hold it out as a possibility, if that is an ethical and acceptable way to go."
Assembly Speaker John Pérez (D-Los Angeles) said Democrats "moved heaven and Earth" in an attempt to pass Brown's proposal and cast doubt on whether the Legislature would agree to any more spending cuts.
"I don't see the votes for something that does cuts beyond the level that we passed (Wednesday)," Pérez said.
Brown, however, said he still has negotiating power because Republicans want changes to laws in areas including public employee pensions and regulations, as well as a spending cap. He rejected the notion that voting for taxes would be "political suicide," noting that the majority of California voters are Democrats or independents and that changes to the election system - including an open primary and independently drawn legislative boundaries - have changed the political landscape.
"I want to see reforms," he said. "All of those things I want, and all of those things I think the people of California want, and in order to get them we just need four Republican votes."
Republicans in the Legislature said they were surprised that the governor used his veto pen so quickly on the Democratic budget.
Republicans deflect blame
"It's very interesting to me that the actions taken yesterday aren't good enough," Assembly Republican leader Connie Conway of Tulare said Thursday. "I'm kind of interested in the fact that they are all in disagreement and for some reason they can't figure it out between themselves. They are the majority, they have the power; they said they used that yesterday, but evidently no one likes the result."
The quartet of Republican senators that has been negotiating with Brown for a resolution issued a joint statement, praising the governor for vetoing a "sham" budget but taking issue with his putting the blame on the GOP. They say that Democrats were blocking an agreement for a public vote on a spending cap and changes in regulations and public employee pensions.