SACRAMENTO UPDATE - March 18, 2011

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from Kevin Pedrotti, Legislative Advocate for the Golden State Builders Exchanges


On Thursday, the legislature passed the main budget bill reducing state spending by $6.2 billion. Democrats amended the budget bill and implementing “trailer bills” to require only a majority vote, using powers granted to them by voters in last year's Proposition 25. This action resulted in party-line votes throughout the day.  The Senate passed the Budget Bill by a majority vote of 25 to 15 and the Assembly passed the Budget Bill by a vote of 52 to 26. The Budget Bill will now go to the Governor.  It is expected the Governor will sign it next week. 

Still unresolved are the most difficult budget issues — whether to eliminate redevelopment agencies – a bill to do so stalled one vote short of passage in the Assembly on March 16 — a bill to reduce a tax break for corporations that do business in multiple states and the legislation necessary to put the tax extensions on the ballot.

The budget voted on by the Legislature is close to that proposed by Democratic Gov. Jerry Brown in January aimed at closing a $25.4 billion budget gap with a roughly 50-50 split between spending cuts and extending several temporary taxes slated to expire this year.

At Brown’s insistence, the taxes – an additional 1 percent of sales tax, a .25 surcharge on income tax and a higher license fee on vehicles – must be placed on the ballot for voter approval. Republicans – two of whom in each house must vote with Democrats to give voters that opportunity — have so far refused to do so.

The proposal of placing the tax extensions will be considered early next week. If as expected the measure fails to gain a 2/3 vote, it is likely the legislature will then take up the tax extension proposal by a majority vote (the Democrats have attained a Legislative Counsel opinion that Prop 25, which gives the legislature the authority to pass bills that implement the budget by majority vote, grants the legislature the ability to pass the proposal to put the tax extension on the ballot). 

If the tax extensions make the June ballot and voters reject the proposal, the legislature will be forced to reduce an additional $12.5 billion in spending.


I have received input for three Exchanges with respect to the GSBE bill review. I had requested they be returned to me by March 11.  Policy committees are beginning to set bills.


I believe there are still spots available to GSBE for the Coalition Day at the Capitol on March 30.  Those interested should contact Aubyn Jo ASAP.