Legislature Fails to Agree on Governor's Fiscal Proposals
The sticking point is Schwarzenegger's call for a spending cap. The GOP says it's needed, but Democrats insist it could lead to devastating cuts.
By Nancy Vogel, Gregg Jones and Evan Halper
Times Staff Writers

December 6, 2003

SACRAMENTO ? Gov. Arnold Schwarzenegger acknowledged late Friday that the Legislature would probably not approve a pair of financial recovery proposals that he had hoped to place on the March ballot.

In a succession of votes, Senate Republicans and Democrats took turns shooting down the governor's plan and a Democratic alternative to borrow as much as $15 billion to patch a gaping hole in the state budget and prevent future fiscal crises.

The Senate adjourned for the week about 9:40 p.m. Debate continued in the Assembly.

GOP senators who met with the governor afterward emerged to say he was very disappointed.

Republicans and Democrats blamed each other for the failure to reach a deal.

The governor defined lawmakers as "overspending addicts during his campaign," said Rob Stutzman, Schwarzenegger's director of communications. "And as overspending addicts, they've been unable to bring themselves to a place tonight where they can truly recognize the ways of their overspending and reform themselves."

Senate President Pro Tem John Burton (D-San Francisco) and Senate Republican Leader Jim Brulte (R-Rancho Cucamonga) exchanged barbs on the Senate floor when Brulte threatened to put an even tougher constitutional spending cap before voters next November.

"The governor bent over backwards to try to meet you halfway," Brulte said.

"Halfway?" Burton responded. "Bending over backwards? You must have been in a different meeting than I was at."

Stutzman also suggested that the governor would turn to voters in November and request that they approve a ballot measure containing an even tougher constitutional spending cap.

But California will run into significant trouble long before then: If some kind of bond proposal is not approved by voters in March, the state could run out of cash in June, when $14 billion in short-term loans obtained last year is due.

Aware of this possibility, the Schwarzenegger administration took steps Friday to proceed with an existing $10.7-billion bond issue that was approved by lawmakers last summer but has been challenged in court as unconstitutional.