Vote on Tax Hikes in California Budget Falls Short, Talks Continue
Early Wednesday morning, the bill that would increase taxes as part of a proposed budget package fell short of the two-thirds majority needed for passage, the San Jose Mercury News reports (Zapler, San Jose Mercury News, 2/17).
The vote was 23-12, with Sens. Roy Ashburn (R-Bakersfield), Dave Cogdill (R-Modesto), Lou Correa (D-Santa Ana) and Dave Cox (R-Fair Oaks) abstaining.
Senate President Pro Tempore Darrell Steinberg (D-Sacramento) said he believed Ashburn, Correa and Cox would back the tax increases once an additional vote from a Republican senator is secured (Sanders, Sacramento Bee, 2/18).
The budget proposal would rely on a combination of tax increases, spending cuts and borrowing to address the state's projected $40 billion budget deficit.Â
The proposal features a $208 million drop in funds for health care programs, including a provision that would eliminate dental benefits for adult beneficiaries of Medi-Cal, California's Medicaid program (California Healthline, 2/17).
Aaron McLear, a spokesperson for Gov. Arnold Schwarzenegger (R), said the governor negotiated with lawmakers until Tuesday night and would resume negotiations today (San Jose Mercury News, 2/17).
If the budget proposal is approved, a special election with five measures on the ballot would be scheduled for May 19.Â The ballot would include proposals to:
- Spend $460 million from Proposition 63 over two years on existing state mental health programs (Buchanan/Yi, San Francisco Chronicle, 2/17).Â Californians approved Proposition 63 in 2004 to increase the state income tax on high-income state residents to fund mental health services (California Healthline, 2/17); and
- Eliminate the state First 5 Commission and channel $340 million from the program to existing children's programs (San Francisco Chronicle, 2/17).Â In 1998, voters approved Proposition 10, which created the First 5 program using the proceeds of a state tobacco tax increase to fund early childhood health care and education programs (California Healthline, 2/17).
Absent a budget, the governor's administration began sending layoff notices to 20,000 state employees yesterday as part of an effort to eliminate 10,000 state positions and cut the state payroll by 10%.
Lynelle Joelley of the state Department of Personnel and Administration said the notices went to the 20% of workers with the least seniority at each of the 54 departments that the state general fund finances.Â
Joelley said the Department of Corrections and Rehabilitation would issue the most layoff notices, followed by the Department of Mental Health (San Jose Mercury News, 2/17).
State workers represented by the Service Employees International Union Local 1000 would be largely exempted from the layoffs under a tentative agreement the union reached with the governor.Â
The union is the largest state employees union, representing 95,000 state workers, including registered nurses (Young, AP/San Francisco Chronicle, 2/17).
On Tuesday, state Finance Director Mike Genest directed state agencies to stop infrastructure projects on Thursday if a budget is not approved by then (San Francisco Chronicle, 2/17).The order would affect 276 projects statewide, including a veterans' home in Ventura County (Carlson, Ventura County Star, 2/18). Construction on a veterans' home in Fresno also would be halted (Sanders, Sacramento Bee/Fresno Bee, 2/17). This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.