By Miriam Raftery
February 18, 2009 (San Diego) -- Efforts to pass a $40 billion state budget plan collapsed over the weekend due to Republicans refusal to support the plan, which fell one vote shy of passage in the Senate. The state has halted refund checks to taxpayers and payments to vendors, stopped 2,000 public works projects and announced plans to stop payments for foster parents and other social services because California has no more money. Governor Arnold Schwarzenegger has ordered furloughs for state workers and tonight said he will send lay-off notices to 20,000 people on Tuesday. Loans are no longer an option due to the state’s bad credit rating.
“I don’t know what it takes for people to believe this really is a crisis,” said Senator Denise Ducheny, (D-San Diego), chair of the Senate Budget committee, whose district includes Lemon Grove, Spring Valley, and some eastern portions of San Diego.
State Senator Christine Kehoe of San Diego, chair of the Senate Appropriations Committee, also supports the measure, along with the rest of the Democratic Senators in Sacramento. But at least one Republican vote is needed, and thus far, the GOP has blocked passage despite the urging of Governor Arnold Schwarzenegger to support the latest measure, the Sacramento Bee reports.
Republican Senator Dennis Hollingsworth (photo), whose district includes most of East County as well as portions of Riverside County, issued a press release calling the budget plan a “disaster” for Californians. “Punishing every Californian by increasing their taxes, especially in a time such as this, is not only wrong-headed for the economy, it is simply morally wrong,” he said, adding that families would be hurt by higher taxes. “The people sent Republicans to Sacramento to be a blockade against tax increases. Once that wall crumbles, there will be no end to the expansion of taxes and spending,” he predicted, adding that people would “rightly figure they can vote for Democrats and at least stand a fair chance of getting their entitlements and programs along with tax increases. As Republicans, we will only remain as the party that gives them tax increases and no programs.”
Now, Senate Republicans have ousted their leader for supporting tax increases--and named Hollingsworth new head of Senate GOP. Today, WLOS-TV in Los Angeles predicts that budget talks will collapse with Hollingsworth at the helm.
Just what are the tax increases that Senator Hollingsworth and other Republicans find so objectionable that they would opt for the state to stop paying its bills and cut off vital services instead?
Proposed tax hikes include a penny per dollar increase in state sales tax, a 12-cent-a-gallon gasoline tax hike, and an increase in vehicle licensing fees. In addition, taxpayers who owe money to the state at the end of this year would pay a one-time 5% income tax surcharge, which will drop to 2.5% if California gets its share of the federal stimulus bill. Some tax hikes would remain in effect through the 2013-2014 fiscal year if voters approve a proposed cap on state spending.
Hollingsworth has consistently opposed other forms of tax increases, such as eliminating tax loopholes for yacht owners, arguing that it would hurt the yacht sales industry. (Just how many yacht sales are made in his inland district, however, is unknown.)
Legislative leaders from both parties and the Governor agree on one thing, the Associated Press Reported on Friday: California faces insolvency unless the Legislature enacts a mid-year budget fix. Legislative leaders believe they have enough votes for passage in the Assembly, but remain stonewalled without Senate approval.
If you wish to express your views on the state budget, contacts for our region's state legislators are listed in the Sound Off! section of our Citizens Action Center.