Capitol Alert

Assembly Republican leader Mike Villines visited with The Bee Capitol Bureau on Monday morning and sounded dour about the Legislature's chances for passing a state budget anytime soon.

"We're doing meetings, but we're not making a ton of progress," Villines said on the final day of the 2007-08 fiscal year.

The four legislative leaders are meeting regularly, but "a lot of it is building a rapport."

Next year's budget is supposed to be in place by July 1. The state faces a $15.2 billion deficit. "We're not going to make the deadline for tomorrow," Villines declared.

In part, he blamed Democrats for sticking to a plan to raise taxes - $11 billion in the Senate and $6 billion in the Assembly - for stalling talks. He called such figures "totally unfounded and out of touch with reality."

"We understand the budget is a compromise. Being in the minority, we understand that," Villines said. "But we're having a difficult time getting our counterparts to really change their original premise on the budget, which is, 'We need taxes. We need to continue spending in government and that's the budget that we want.'"

"I keep waiting for that to end so we can get to where we are seriously negotiating," he added. "We haven't gotten there."

He also criticized Democrats for refusing to name what taxes they would raise. "They don't want to put it out there," he said.

Villines said he expected the two sides to eventually agree to about $10 billion in reductions to the deficits, but called the last $5 billion "the unresolvable number."

Assemblyman Roger Niello, a Fair Oaks Republican and vice-chair of the Assembly Budget Committee, agreed. He said lawmakers were "struggling through the conference committee" for the budget. The committee, on which Niello sits, has "closed out maybe 20 percent of the items," he said.

Both Republicans said GOP reform proposals - for the budget and schools -- would be key to a deal. But, so far, those plans have fallen on deaf ears.

Legislative Republicans, among other reforms, have called for a tough spending cap limiting the growth of government to inflation and population growth. That would likely prevent the creation of new government-funded programs.

"They're really not acknowledging the reforms at this point," Villines conceded.

Here are some of the highlights of the hour-long discussion:

On areas of agreement: Villines said the budget for prisons was one of the areas Democrats and Republicans have come together. He said lawmakers would "probably get to where (the) corrections (budget) is almost flat."

On negotiations over naming acceptable cuts and tax hikes: "It comes down to a couple of things. They say give us a list of cuts. We say well, we recognize a lot of the governor's already...we're asking them, lay out this tax increase. What is this tax increase? Of course, they don't want to do that."

On Democrats not naming tax hikes: "What we're saying is give us this list your talking about so that we can at least have a good negotiation and understand where you're trying to go."

He later said: "If that's their priorities, if that's their values, then they need to put it on paper and vote on it."

On using the lottery in the 2008-09 budget: "There is general agreement on this between the four of us (legislative leaders). The lottery, if it is to be used at all, is only for out-year solutions."

"You can't say it's a this year issue," Villines said of putting the lottery on the fall ballot. "What if the voters say no?

On potentially borrowing funds from voter-approved accounts like Proposition 10 and Proposition 63: "We are willing to look at some borrowing if it has a funding mechanism to pay it off." The lottery, he said, could be such a mechanism.

On tax-loophole closing: "We are more than willing to look at what they are saying (are) loopholes."

On legislative deadlines: I've never seen a rule that's followed in the Legislature

On future budgets: "Next year could be worse than this year."

On the PR war to come when the budget is late: "The truth is labor is a bottomless pit of money and they will continue to do things that they do" such as stage events when the budget is late.
Villines.jpg
Photo credit: Brian Baer, Sacramento Bee

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