As the state completed its second week of the
fiscal year without a budget, there were no signs in the Capitol that a budget
compromise is anywhere in sight.
However, The Sacramento Bee reported July 14 that
all four legislative leaders are meeting regularly, and that Senate President
Pro Tem Darrell Steinberg and Senate Republican leader Dennis Hollingsworth
"have been engaging in side conversations," including some that have
included Senators Denise Moreno Ducheny and Bob Dutton, the budget chairs of
their caucuses.
"The thinking
is that any fruitful budget deal will have to originate in the Senate," The Bee wrote. "Steinberg and
Hollingsworth have worked together before and seem more inclined toward
compromise than their Assembly counterparts. That's not to say they're ready to
cut a deal – they remain a long way apart on the tax issue – but they seem to
trust each other's motives more than Assembly leaders do at this point."
Assembly Republican
Leader Martin Garrick indicated that no budget compromise is on the horizon. In
a July 15 statement, he said: "Senate and Assembly Democrats continue to
advance separate plans to raise taxes and push off the problem. With a $19.1
billion deficit, Democrats have only agreed to $2-$3 billion in spending
reductions. … There is some common ground on future revenue and federal fund
projections, but we are nowhere near agreement on the real spending reductions
needed to balance the budget. With 12.3 percent unemployment, and the highest
taxes in the nation, raising taxes is not an option."
In other
budget-related news:
Controller Says June Revenues and
Expenditures Were Below Estimates in May Revise. Controller John Chiang reported July 9 that
state revenues for June were $54.6 million below the amount predicted in the
governor's May budget revision (a 0.5 percent difference).
"California's
cash position is stable today, but that could be short-lived," the
controller said. "The governor and Legislature's lack of urgency in
adopting an honest budget could pave the way to a completely avoidable cash
crisis later this year."
Personal income tax
revenues were $333 million higher (6.1 percent) than anticipated, corporate
taxes were down $156 million (7.5 percent), and sales taxes dropped $153
million (5.7 percent), according to the report.
Expenditures were
running $1.36 billion below estimates through June 30. The state's $9.9 billion
cash deficit is being covered entirely by internal borrowing, Controller Chiang
said.
Cal-TaxReports, July 19, 2010
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