February 15, 2008

Budget skirmish: round one

Both houses of the Legislature are expected to act today on the first package of budget cuts and deferrals designed to begin closing an estimated $14.5 billion gap between revenues and projected spending. The run-up to the floor votes has been true to form in both houses.

In the Assembly, after frequent consultations between Speaker Fabian Nunez and Republican Leader Mike Villines, the package won a bipartisan vote in committee and is expected to do the same on the floor. The package was vetted in sub-committee and there were few if any surprises by the time the members were asked to vote. Among other things, it cuts about $400 million in school spending and reduces rates paid to doctors who care for the poor, which would save about $550 million next year. The package also responds to a court ruling on transportation funding that blew a $400 million hole in this year's budget.

In the Senate, Republicans balked -- at spending cuts, no less -- in part because they said they had been blindsided by the package, having not seen it until a few minutes before the budget committee hearing. And one Democrat -- Joe Simitian of Palo Alto -- was stripped of a committee chairmanship after the vote, apparently because he too persistently pushed for an education package that would leave lawmakers more room to cut spending later if they chose to. This is par for the course in the Senate: a shortage of communication and a surplus of retribution.

In the end, both houses are expected to pass the package today on bipartisan votes. But this will be only the beginning, enough to stave off a cash-flow crisis, trim some spending in the current fiscal year and lay the groundwork for possible cuts in the months ahead. The real heavy lifting will be finding the cuts or revenue to balance the budget for the fiscal year that begins July 1.

Posted by dweintraub on February 15, 2008 6:43 AM