Senate President Pro Tem Don Perata issued a strong, but carefully worded statement Friday insisting that the Democratic leadership in the Legislature has "never entertained massive borrowing as a solution to this year's budget problem."
Perata's statement comes after Capitol Alert reported on Wednesday and the Los Angeles Times reported today that lawmakers are considering raiding transportation and local government funds to balance the books.
In his statement, Perata said, "The Assembly Speaker and I maintain that permanent revenues are needed. Budget reform starts with ending the borrowing and gimmicks and fixing the problem once and for all."
He added, "Doing another get-out-of-town-alive budget would do nothing to help this state but rather would endanger Californians' standard of living and economic future."
The Perata statement issued Friday, however, did not rule out borrowing finding its way into a final budget. The statement reiterated that the Democrats' priority is to find a more permanent solution to the state's structural budget problems.
The Democrats have proposed raising more than $9 billion in taxes, but Republicans have said that plan is dead on arrival.
As Capitol Alert reported Wednesday:
Gov. Arnold Schwarzenegger and lawmakers on both sides of the aisle have repeatedly proclaimed in public that they want to tackle the state's structural budget problems -- not just paper over the budget with borrowing to get out of town.
But given the size of this year's budget hole -- coupled with Republicans' reluctance to raise taxes and Democrats' "line in the sand" on cuts -- the chances of raiding such funds appears very high.
When asked if borrowing from transportation and local government funds was under consideration earlier this week, Lynda Gledhill, a Perata spokeswoman, declined to comment. She said only that the Democrats' priorities were reflected in the conference committee budget, which includes no such borrowing.
Here is Perata's statement in full:
"Today's Los Angeles Times story about state budget negotiations is inaccurate and misleading. Democrats have never entertained massive borrowing as a solution to this year's budget problem. In particular, Democrats have never advocated nor believed in taking money from Propositions 1A, 42 and 10."
"From Day 1, Democrats have rejected accounting gimmicks, such as the Governor's scheme to borrow $5 billion from the lottery's future revenue to pay for this year's shortfall and his plan to count $2 billion in future revenue as the reserve."
"The Assembly Speaker and I maintain that permanent revenues are needed. Budget reform starts with ending the borrowing and gimmicks and fixing the problem once and for all."
"Doing another get-out-of-town-alive budget would do nothing to help this state but rather would endanger Californians' standard of living and economic future."
Sen. Denise Ducheny, the Democratic chair of the Senate Budget Committee, said:
"Democrats have proposed a clear plan that balances the budget and solves the fiscal problem, instead of kicking it into future years and adding billions of dollars of debt that crowds out vital programs, such as K-12 education and health services for poor children and the elderly."
@Nyx.CommentBody@