League of California Cities - 2009-10 Legislative Session Ends Without State Budget

The Senate and Assembly each took time on Tuesday, the final day of the 2009-2010 Legislative Session and 62 days into the fiscal year, to discuss and vote on dueling budget plans. As expected, neither plan passed, however it was an important step in what has become a complicated dance of budget negotiations. The floor debate also provided a picture on where each party stands.

Democrats put forward a plan that contained spending authorizations that would provide more money to schools and continues funding for welfare-to-work programs. After reportedly facing pressure from within their own caucuses, Democratic leadership did not take up trailer bills that contain the "tax swap" proposal, increase in the Vehicle License Fee, delay several corporate tax breaks, or suspend Proposition 98. Republicans claim the proposal was just a ruse, and that the Democrats' endgame is to significantly raise taxes that would hurt the middle class. As proof, the Republicans posted a series of budget bills online that they say Democrats have drafted but did not put up for a vote.

Republicans put forward a plan that contained most of Gov. Arnold Schwarzenegger's May Revise with some notable changes. The proposal did not include the use of red light cameras to catch speeding drivers, raising property insurance surcharges to pay for emergency response, increasing water quality fees, and housing low-level prisoners in county jail. The Republican proposal eliminated welfare-to-work programs and state-subsidized childcare. Democrats argued that the Republican plan would cost the state billions in federal dollars while hurting low-income Californians and students.

On Wednesday morning, the Governor held a press conference to discuss the budget. He criticized the Democrats for proposing a budget that continues the practice of spending beyond the state's means; however, he seemed to leave the door open on increased revenues. He stressed that work towards a budget agreement continues, even when it appears that no progress is being made. The Governor indicated that they may be very close to a budget agreement.

Sen. Bob Dutton (R-Rancho Cucamonga) was scheduled to become Senate Minority Leader on Sept. 1 unless a budget agreement was imminent. As of Wednesday, Sen. Dennis Hollingsworth (R-Murrieta) retained the Senate Minority Leader position and there was no date set for a transfer of positions to occur. This could be seen as a positive sign that budget negotiations are progressing.

As the 2009-10 Legislative Session officially adjourned, the Governor will need to call a Ninth Extraordinary Session or ask the Legislature to take up the budget in an already open extraordinary legislative session.