California’s Proposition 25 Would Have ‘Majority Rule’ on Budgets

SACRAMENTO – California’s Democratic and Republican parties both held mock bake sales last month at the Capitol to protest each other’s “half-baked” budget ideas for plugging a $19 billion deficit for the year that began July 1 without a new plan.

Governor Arnold Schwarzenegger, who has installed a clock outside his office ticking off the days without a budget and the growing size of the deficit, suggested last week he might leave office in January without signing a budget at all.

While this year’s stalemate has provided colorful political theater, late budgets are practically the norm in California. Since 1980, the Legislature has met the June 15 constitutional deadline for sending a budget to the governor only five times. Only ten times has the brokering been done by the July 1 start of the fiscal year.

Many people in Sacramento have come to believe that California’s restrictive budget rules are a big part of the problem. California is one of only three states that requires a supermajority vote of the Legislature to pass a state budget (Arkansas and Rhode Island are the others). In November, voters will weigh in on Proposition 25 , a ballot measure that would lower the vote threshold down from two-thirds, so that lawmakers could pass budgets with a simple majority.

Supporters say the change would help California to wrap up its budget process on time and reduce the strain on state workers and contractors who this time of year get to wondering whether they’ll continue to be paid. The current system has “strangled democracy and put the minority party in control of major decisions to manage the system,” says Dennis Smith, secretary-treasurer of the California Federation of Teachers, one of several unions responsible for getting the measure on the ballot. The League of Women Voters of California also endorses Proposition 25.

In addition to changing the budget vote threshold, the measure would dock lawmakers’ pay and daily living allowance for each day the budget is not approved. Supporters insist that the measure would not change California’s constitutional requirement that any new taxes or tax increases pass both houses of the Legislature with a two-thirds vote. But business groups and other opponents say that’s not the case.

A coalition of taxpayers and employers called Stop Hidden Taxes , sponsored by the California Chamber of Commerce and California Taxpayers’ Association, says Proposition 25 includes “hidden” ways to allow legislators to raise taxes as part of a budget bill with a simple majority vote. “It should come as no surprise that the special interests behind this measure would try to sneak a measure by voters that makes it easier for the state Legislature to raise taxes on Californians,” says Teresa Casazza, president of the California Taxpayers’ Association.

An analysis by the nonpartisan Legislative Analyst’s Office hasn’t settled the dispute. It says that Proposition 25’s “provisions do not specifically address the legislative vote requirement for increasing state tax revenues, but the measure states that its intent is not to change the existing two-thirds vote requirement regarding state taxes.”

Balance of power

What is clear about Proposition 25 is that the impact of the measure, if approved, would largely depend on the political control of the Legislature and governor’s office going forward. Currently, California’s governor is a Republican but both houses of the Legislature are controlled by Democrats. “It could make a big difference if you had a Democratic governor and Democratic Legislature,” says Mac Taylor, who heads the Legislative Analyst’s Office. “Clearly, the minority party would not necessarily be a factor.”

Schwarzenegger has said he would wait to offer his official position on the measure until after a budget was done. But his comments during a July 26 budget roundtable at the Los Angeles Chamber of Commerce leave little doubt what he thinks about Proposition 25.

I “don’t believe in doing the budget by a simple majority,” Schwarzenegger said, according to the Sacramento Bee . “Because if you do a budget by simple majority, again, there is one party that will make all the decisions. I think it needs the input of both of the parties because you can see the first thing (Democrats) did was come up with borrowing or a tax increase.”

So far, voters appear to support Proposition 25. A greater than three-to-one majority of voters said they favored the measure, according to results of a Field Poll released July 9. Opponents say voters don’t understand the measure. “We firmly believe that once more voters learn what Prop. 25 will do, voter opinion will change and it will change quickly,” the Stop Hidden Taxes coalition said in a statement after the poll came out.

Proposition 25 will have to vie for voters’ attention, as it is among at least nine other ballot measures up for consideration in November, not to mention the races for governor, other statewide offices and the state Legislature. One ballot measure, Proposition 26, would require that any new fees or charges require a two-thirds vote from the Legislature for approval, rather than a simple majority. The same unions that support Proposition 25 oppose Proposition 26, while the reverse is true for business groups.

Aside from the budget, Californians also will decide whether to legalize and tax marijuana and whether to suspend the state’s 2006 law restricting greenhouse-gas emissions.

Smith, of the California Federation of Teachers, says he’s not too worried that Proposition 25 will get lost amid a long ballot of questions and candidates. “This is California after all,” he says. “We are used it.”