Budget options: Temporary taxes, majority vote

Gov. Brown’s decision to pull the plug on budget negotiations left Capitol partisans plotting their next moves, which could include a push by the Legislature’s ruling Democrats to move Brown’s tax-and-cut package to the ballot with simple-majority votes.

But that move is all but certain to fracture a fragile coalition, forcing business interests from the fold and pushing labor into a fighting crouch.

Options include a plan to adopt tax extensions temporarily – 90 days perhaps – while a permanent budget agreement is hammered out that could go to the electorate in September. The new fiscal year begins July 1.

Labor groups, critical to a successful ballot campaign, have been restive for weeks. Privately, they have proposed an all-out campaign to battle the GOP in their districts. Thus far, however, Brown has kept them in check, insiders say.

Meanwile, rival interests are eyeing budget ballot measures going before voters in November, such as GOP-backed plans for a permanent spending cap and public pension changes, and a potential move by organized labor to protect pensions and build revenues for education.

Raising taxes requires two-thirds votes, but simple-majority votes would suffice in some cases, such as tapping voter-approved programs already in law – an action that has become common over the years as lawmakers scrambled to balance the books.

A Legislative Counsel’s opinion, sought by Senate GOP Leader Bob Dutton, has said that in those cases, simple-majority votes are legal. Typically, however, they have been done with two-thirds votes.

As for Brown, he wants an election on the budget.

The governor has said repeatedly that he wants to place the budget before voters and “nothing has changed,” said Brown spokeswoman Elizabeth Bradford. The question is whether it will be June or some other date, even November, is uncertain.

“Right now we’re regrouping and taking a look at the best way forward. There hasn’t been a decision taken at this point. Obviously, the governor wants to figure out the best way to bring this choice to voters.”

Brown has not entirely closed the door on a June special election, but he said there would be challenges in meeting a June date. The alternative to June is commonly seen as November but it could be sooner. If a temporary tax extension were to be approved, the election could be held in September, when the extension expires.

Meanwhile, organized labor groups are not saying publicly what they will do next. Privately, they are looking at everything from an all-out campaign to push deep budget cuts into the Republican districts to their own ballot measure.

“At this point, we are looking at all of our alternatives and we’re trying to figure out what is the best way to go,” said Sandy Harrison, a spokesman for the state Building and Construction Trades Council, whose affiliated groups represent some 350,000 workers.

The California Labor Federation, an umbrella organization, represents more than 2.1 million workers in 1,200 unions, is also weighing its options.

“Certainly there has been no decision at this point on how to move forward,” said Steve Smith, a Federation spokesman. “Our main focus is that we absolutely cannot allow $14.3 billion worth of cuts to plunge the state off a cliff.”

On Tuesday, after three months of budget negotiations, Brown ordered a halt to talks with the Legislature’s Republicans in his bipartisan attempt to resolve the state’s $26 billion deficit.

The action left both Brown and Republicans in a political hot seat.

 For Brown, he has to decide whether to push for a majority-vote to place his plan on the budget for a June special election – a plan that is legally uncertain and all but certain to outrage business backers of his election plan.

For Republicans, they have to fend off the appearance of being afraid to negotiate and of playing politics with the state’s fiscal woes.

Brown, a Democrat, in a letter to Senate Republican Leader Bob Dutton, said the negotiations had focused for weeks on a spending cap, public pension issues and regulatory reform. Brown posted a YouTube video of his position.

But, he said, Republicans late last week added dozens of separate demands, “many of which are new and have no relationship whatsoever to the budget.” Brown noted that legislative Democrats already have approved billions of dollars worth of cuts.

“From my count, your list today added almost two dozen new topics, including obscure aspects of labor law and shifting the presidential primary to March. In addition, your list of demands, if met, would undermine my entire budget proposal by undoing major elements and extending the taxes for only 18 months,” Brown wrote.

Just days after he took office – for the third time – in January, Brown proposed a budget composed of equal parts of taxes and cuts to cover the state’s budget hole, and argued that voters had the right to decide the issue.

Republicans have opposes placing tax extensions or new taxes before the public. Democrats control the Legislature, but lack a two-third majority in either house required to approve new taxes.

Democrats, he added, “have swallowed hard and done their part – they have approved $12.4 billion in painful cuts.”