Budget drama ’07: hurt feelings, term-limits, gerrymandering and … Jeff Denham?

The story of this year’s state-budget delay begins in December 2006 in Newport Beach.

It was there, just weeks after Gov. Schwarzenegger’s re-election, that Sen. Jim Battin, R-La Quinta, announced he was challenging Dick Ackerman’s leadership. In the end, Ackerman fended off Battin’s challenge by the narrowest of margins–with seven of the caucus’s 15 members voting to dump Ackerman as leader.

But the seeds planted in Newport last December are now beginning to flower. The result is a unified Republican caucus, and a state budget delay that is moving into its fourth week.

“When Dick Ackerman became more conservative, stopped cutting deals and started representing our caucus, we became unified,” Battin said Wednesday.
The central issue in last year’s leadership struggle was concern that conservative voices were not being heard in the caucus leadership. At the time, Battin said, “We had a long discussion on how the leaders should act with the governor.”

Conservatives were particularly concerned about Ackerman’s agreement to a quick resolution of the 2006 budget, and for offering Republican votes for billions of dollars in new bonds for infrastructure projects. In the Assembly, Republicans dumped their leader, George Plescia, and replaced him with the more conservative Mike Villines, citing similar concerns.

After surviving his own leadership challenge, Ackerman seemed to get the message.

“The [2006-07] budget was more of an election-year budget, as we talked about. It was more status quo,” he said on December 7, just after vanquishing the Battin challenge. “This year is not an election year, and we’re going to take a harder line of the budget. Our entire caucus is dedicated to that.”

That seemed to most like posturing at the time. To get a budget out of the Senate, Democrats needed to pry only two votes. And, typically, the more moderate members of the caucus, Sens. Abel Maldonado, R-Santa Maria, and Jeff Denham, R-Merced, were seen as likely budget votes.

But Ackerman’s words after his re-election as leader have proven prophetic as the state budget standoff continues.

A number of other factors have contributed to the budget delay. Senate Republicans have felt slighted by Gov. Schwarzenegger, both as a group and individually, dating back to last year’s campaign season. (Maldonado, for example, lobbied for Schwarzenegger’s support in a primary against conservative Tony Strickland. Schwarzenegger refused, and Maldonado lost.)

Possible changes in state term-limits law, non-competitive Senate districts, the rise of conservative blogs and the changing political goals of a moderate GOP senator have all contributed to the budget quagmire we now see in the Senate.

With a proposed change in state term-limits law close to qualifying for the February ballot, Ackerman has apparently changed his mind about when he plans to abdicate the leader’s chair in the Senate GOP caucus. According to several members of the Senate Republican Caucus, Ackerman said he planned to step aside after this year’s budget was signed. But recently, Ackerman has been quoted as saying he planned to remain on as leader, at least until February or possibly April.

Ackerman is scheduled to be termed out of office in 2008, setting the stage for a leadership fight between Sens. George Runner, R-Lancaster, and Dave Cogdill, R-Modesto. In February, however, California voters will be voting on a change in state term-limits law that would allow Ackerman to seek another four-year term, and Ackerman’s recent comments seem to indicate that he wants to see how that measure fares at the polls before giving up his leadership post.

Several senators also say the fact that no Republicans face competitive races next year is hurting the budget’s chances in the Senate. Only one Republican senator, Santa Maria’s Abel Maldonado, has abstained on the budget, and is seen as a possible “yes” vote for the proposal passed by the Assembly.

In the past, Democrats could rely on Sen. Jeff Denham, R-Merced, to be the 27th vote needed to pass a budget out of the Senate. Denham was elected in a district drawn for a Democrat, and cast his votes with an eye on a possible electoral challenge from a Democrat.

But last year, Denham was re-elected to the Senate (without a strong Democratic challenger) and has set his sites on running for lieutenant governor. A closed Republican primary in 2008 is a very different political audience, and there are signs Denham has been mindful of that during this budget standoff.

Tuesday, Denham’s office released a statement reinforcing the senator’s position on the budget. “My goal is to have a balanced budget,” said Denham. “It is not fair to the people of California for their legislators to vote in favor of a budget that only increases the state’s debt.

Denham also teed off on the $7 million allocated for a UC facility in Mexico City, laying out some red meat for potential GOP primary voters in the process.
“The Mexican government should actually owe California for the money we spend to educate, incarcerate and provide health services for illegal immigrants,” Denham concluded. “This state also provides Mexico with water. California should not spend $7 million on this facility in Mexico City. The state should be focused on funding education for children who live in California.”

Without the political leverage to force a vote from Denham, Senate Democrats have struggled in vain to find supporters for their budget. And the current gerrymander of Senate districts means no other Republicans are facing competitive races in the fall.

“We’re totally immune from pressure,” said one Republican senator who spoke on condition of anonymity.

Meanwhile, a growth in the conservative blogosphere has helped to keep Republicans in line. A story in Wednesday’s Sacramento Bee cites McClintock’s use of e-mails and his blog to help keep conservatives in line.

“For many years, McClintock has been somewhat isolated in the message he has consistently delivered,” education consultant Kevin Gordon told the Bee. “The difference is, this year he’s got a technology-driven megaphone.”

The importance of that megaphone was made clear this week. When Ackerman needed an outlet to announce his proposed budget cuts, he chose conservative Jon Fleischman’s FlashReport.

“I don’t think that it’s the Internet keeping Senate Republicans in line. I haven’t applied pressure to any Senate Republicans,” said Fleischman. “They all have come to their own conclusions.”

But, Fleischman said, the existence of his site “gives Republicans an opportunity to take their message directly to stakeholders. The FlashReport provides a window to activists about what’s going on around California.”

The current fight is, in part, over what the definition of a “balanced budget” is. The Republicans in the Senate insist the budget is out of balance because it spends about $700 more money than the state is projected to take in during the 2007-08 fiscal year.

Democrats counter that because there was about $4 billion left over from the 2006-07 budget year, that the proposed budget is in fact balanced with a $3.4 billion reserve.

In the Senate Wednesday, Sen. President Pro Tem Don Perata, D-Oakland, said he was giving Senate Republicans, “a chance to beat their chests and tell us what they stand for.” Perata said Californians were being “terrorized by a small group of ideologues” in the Senate Republican Caucus intent on holding up the budget.

Numerous Capitol sources have confirmed that Gov. Schwarzenegger has already agreed to “blue pencil” out an additional $200 million or so in spending programs. But that number is not enough for Senate Republicans.

Senate Republicans released their list of about $800 million in additional cuts Wednesday. Those cuts are expected to be voted on the Senate floor Thursday, and Republican leaders say there will be unanimous support for the proposal in their caucus.

But the new list o
f cuts has very little overlap with the list of programs already on the governor’s veto list. Many of the most dramatic cuts in the Senate GOP proposal, including a $300 million reduction in welfare benefits, would require statutory changes, and could not simply be line-itemed by Gov. Schwarzenegger.