This week, under the leadership of OCBC Chairman Eddie Northen of UPS, we head to Sacramento to get a bird’s
eye view of the negotiations on closing a state budget shortfall of $25 billion. We’ll hear from Assembly Speaker John Perez, Treasurer Bill Lockyer and even Governor Brown. OCBC urges a deal to get done to avoid shutting down road and freeway projects that help a recovering economy, and further avoid education funding deferrals.
Now that the June special election is out of the question, all roads are pointing to a ballot measure, perhaps a budget package, for November 2011. The Governor has started on a road trip to bring his case to the people. Senate Pro Tem Darrel Steinberg has indicated that his Budget Committee will begin conducting hearings outside the Capitol. Assembly Speaker John Perez also announced that Democrats will hold budget summits throughout the State as well. The Republicans announced a road show of their own, with their first stop in Fresno. As for solutions, there’s always a chance the governor and the Democrats will push for simple majority budget, although unlikely as it would go against the Governor’s campaign pledge of bipartisan collaboration.
There is also a rumor that Republicans may ask for a carve out of redevelopment agencies, enterprise zones and the single sales tax factor, a price tap of about $3.7 billion. If they do get this carve out, along with other concessions, they may agree to a lower-term tax extension, like three years instead of five. This would also mean that an additional $3.7 billion would be added to the $11.5 billion in cuts that has already been implemented.
The May Revise will be coming out in mid-May, but is expected to be an “all-cuts” budget, which will give voters a grim reality of what the Legislature will be faced with if they don’t pass the tax extension ballot measures.
For more information on the budget woes, contact Kate Klimow
, Vice President of Government Affairs.