Trailer bills bring budget home

Follow the money, follow the trailer bills.

As the 2007-08 fiscal year looms without a state budget, the public’s gaze fastens on the $143 billion spending plan waiting in the wings. But within the Capitol, budget discussions invariably turn to the ‘trailers’–those bills, crafted at the 11th hour with little outside scrutiny, that make necessary changes in laws to put the new budget into effect.

The trailers are side deals to the budget. They are negotiated privately, with the public absent. Lobbyists are excluded, too. There are no hearings. The bills get their first public airing when they are brought up on the floors of the Senate and Assembly. There, rank-and-file lawmakers typically learn the contents for the first time, although legislative leaders, their top staffs and even the governor’s staff know what’s in the bills because they negotiated them.

Not only do they change statutes, they also serve to leverage support for the main bill and they represent sensitive negotiations between warring interests. So advance information about trailer bills is always closely held–and this year is no exception.

The trailers control billions of dollars. Their veto rate is low because the governor helps craft them, and he cannot line-item veto them since they don’t contain dollars.

“You have to have trailer bills to enact the budget. For example, if the budget suspends a cost-of-living adjustment, you need to make that change in law,” said Jean Ross of the California Budget Project, a nonprofit group that analyzes the state’s fiscal policies with the goal of improving programs for low- and moderate-income people.

“But where it becomes a problem is where policies that haven’t been heard [in committees] are rolled out in the budget process to avoid an appropriate level of public scrutiny. It’s a problem for the committee structure when you don’t fully involve the policy committees and their staffs in reviewing the bills,” Ross added.

The lack of public hearings paints a picture of skullduggery, but that is far from true, veteran Capitol budget experts and lobbyists say. That’s because the bills are vetted by leaders who have consulted their caucuses–and others. “There isn’t any conspiracy, people aren’t sneaking stuff in. Before the trailer gets to the floor, we know what’s in it.”

A veteran lobbyist familiar with budget issues said that without the trailer bills, “what you have is spending on auto-pilot. It’s really very simple: If you have to change the law for the budget, you have to do it in a trailer bill. That’s the legitimate, straightforward use of trailer bills.”

Forty-six trailer bills already are in print–24 of them in the Assembly, from AB 191 through AB 215; and 22 in the Senate, from SB 77 through SB 99. But these are empty vessels with no provisions, no language and no legislative author by name, except “Budget Committee.” They are idling, waiting in the wings to be brought into play as pieces of the budget get hammered into place.

“Sometimes they go to committees, and sometimes there will be discussions of the trailer-bill language. But that doesn’t mean that’s all the action on the trailer bill that you will see. You’re not seeing everything,” said Lenny Goldberg, a lobbyist for the California Tax Reform Association. At one trailer-bill discussion, a subcommittee chairperson’s first action was to remove the lobbyists from the hearing chamber. “There was nobody left in the room bur the staff and the administration,” he said.

That trailer bills are negotiated at the last minute is a function of the jerky, hurry-up-and-wait quality of budget negotiations. The state budget, which under the state Constitution and is supposed to be approved by the Legislature and sent to the governor by June 15, is nearly two weeks late. There is no penalty or immediate pain for being late, but the missed deadline is a starting point to build public pressure on lawmakers to get the budget done.

As budget negotiations intensify, the trailer bills begin forming. Typically, the budget will carry a dozen trailer bills, although some budgets have twice that. Until California courts imposed the “single-subject rule” on legislation, the budget carried only one trailer bill–usually a monster bill of 500 or 600 pages. But now, the trailer bills are sprinkled like confetti, covering issues large and small. Most trailers, like the budget itself, carry two-thirds. Lawmakers won’t vote on the main budget bill–the vote that the public and media watch most closely–until the trailer bills are approved first.

The 2002-03 budget, for example, carried 22 trailer bills dealing with big-ticket items varying from welfare and transportation to a loan payment deferral for the city of Millbrae, a charter-schools bill and a Natural Heritage Tax Credit. Four were vetoed–including the Millbrae loan deferral. Hastily crafted, a trailer bill sometimes contains errors, which are corrected in a follow-up bill called a “caboose.”

This year, the partisan budget debate focuses on relatively small dollars, unlike some years when there were double-digit deficits in the billions of dollars. “There really isn’t a lot on the table to fight over, given our ongoing budget crisis,” said Assembly Democratic spokesman Steve Maviglio.

But however small the dollars, there is likely to be numerous trailer bills, each incorporating pieces of the compromise reached by lawmakers and the governor.

“You have to have trailer bills,” said Ross.

Contact John Howard at john.howard@capitolweekly.net