Capitol Alert

Ever since the California Taxpayers' Association endorsed Gov. Arnold Schwarzenegger's proposed budget -- which includes a temporary 1-cent sales tax hike -- conservative Republicans have gone on the offensive to discredit the 82-year-old taxpayers organization.

The president of a rival taxpayer association said the group had been "rolled" by the governor.

A regional vice-chairman of the Republican Party mocked them as "TaxCal."

And on Tuesday, 31 of the 32 Assembly Republicans co-signed a letter blasting the group for making "a cynical political calculation" in supporting the governor's plan, which calls for the a permanent quarter-cent sales tax decrease after the three-year hike.

(Read the full letter.)

The board of Cal-Tax, as the group is known, voted 28-19 on Friday in favor of the governor's plan. Representatives of California's largest corporations dominate the group's board.

"As an association representing taxpayers, we have not arrived at our position lightly," said Teresa Casazza, president of the group, in a statement. The endorsement hinged on "meaningful budget reform" and an "economic stimulus plan" accompanying the tax plan, she said.

That, however, did not fly with GOP lawmakers.

"While your vote will not change our position on the ill-conceived tax increase," wrote the Assembly Republicans to Cal-Tax, "it will open the business community up to tax increase proposals that target your specific industries."

Schwarzenegger is trying to pry loose GOP support for his budget plan a record 72 days into the fiscal year. He met privately with Assembly Republicans on Tuesday and with Senate Republicans last Thursday.

But the governor's relationship with GOP lawmakers is icy, to say the least. In an interview with a German magazine this week, Schwarzenegger said of California Republican party leaders, "I have almost no contact with them. None -- because they're just so out there."

At Tuesday's meeting, Assembly Republicans wore name tags so Schwarzenegger could identify them.

Publicly, he's brandishing the Cal-Tax endorsement to urge them to support his plan. "It's time for legislators to follow the lead of Cal-Tax," he said in a statement Friday.

Republicans, meanwhile, are trying to discredit the group.

After the Cal-Tax vote, Jon Coupal, president of the Howard Jarvis Taxpayers Association, wrote an op-ed accusing the business-backed group of being "rolled" by pressure from the Schwarzenegger administration.

"In the really tough political battles, they have rarely been there for working Californians," wrote Coupal, dredging up the group's opposition in 1978 to Proposition 13, which limited property taxes.

Calling the organization "the mouthpiece for corporate California," Coupal said "they squeal like a stuck pig if elected leaders propose tax increases on them", but "cave" to new taxes on everyday workers.

Jon Fleischman, a regional vice-chairman of the California Republican Party who published Coupal's column on the FlashReport, created a mirror site for the group: TaxCal.org.

"It speaks volumes about TaxCal (our new name for the group) that now, during a time when pro-taxpayer groups are rallying behind our strong Republican legislators, that they have broken ranks and embracing bigger, fatter state government," writes Fleischman. "This is exactly the time when you get to learn who are real taxpayer advocates, and who are not."

David Gilliard, a veteran California Republican strategist, said the divide between Cal-Tax and other Republicans has "been festering for a long time."

"They're fighting for whatever the Chamber of Commerce is fighting for," Gilliard said of Cal-Tax.

Representatives from Cal-Tax declined an interview. But Casazza, the organization's president, issued a long statement saying, "This one disagreement over a compromise budget plan does not change our commitment to fighting for taxpayers."

"We are now in our third month of the new fiscal year -- it's time for a compromise," she said.

As for the Democrats, they are mostly standing on the sidelines, though most hope GOP lawmakers eventually embrace a temporary tax hike.

"My standard political philosophy has always been when your opponents are beating each other to smithereens, don't intervene," said Garry South, a Democratic strategist. "Just stand there and watch."