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Gov. Arnold Schwarzenegger today denounced Proposition 25, which would lower the legislative vote margin for state budgets from two-thirds to a simple majority, and declared that it's a back-door attempt to make it easier to raise taxes. Schwarzenegger,speaking to a business group in Goleta, responded "absolutely no" when asked about his position on the measure, placed on the ballot by Democrats and unions, and then added, "I believe this is also...a majority vote for tax increases."

In an era of term limits, Senate President Pro Tem Darrell Steinberg is now the veteran budget negotiator among the four legislative leaders. Besides the concerns of the Senate Democratic caucus he leads, Steinberg must also consider impacts on state workers who live in his district.The Sacramento Democrat spoke with three reporters on a variety of issues last week after touring a middle school and job-training facility in North Sacramento. What follows is part of the conversation on pensions and the Democratic proposal to raise income and vehicle taxes in exchange for decreasing sales taxes. >Gov. Arnold Schwarzenegger says pension...

California still faces a $19.1 billion deficit. The budget is over a month late, no negotiated compromise is in sight, and worst of all, no serious minds in Sacramento are even considering long-term solutions. What we usually get instead are short-term gimmicks, the most recent one now has been presented as part of the Democratic proposal to balance the budget. Darrell Steinberg, Democrat and Senate President Pro Tempore (leader), is suggesting a tax shift. His proposal cuts the state sales tax rate by 1.75% and raises income tax rates and car license fees to offset the sales tax reduction. This...

"A year-old program granting movie studios tax breaks for filming in California has saved jobs and should yield two billion dollars in direct spending, Governor Arnold Schwarzenegger said. In a statement released Friday, the governor said the program was "creating and retaining tens of thousands of jobs and generating spending in California." "This is exactly why I fought so hard for tax credits in last year's budget," Schwarzenegger said. "Just the first two years of this incentive will generate two billion dollars in direct spending, with even more to come."

LOS ANGELES (AFP) – A year-old program granting movie studios tax breaks for filming in California has saved jobs and should yield two billion dollars in direct spending, Governor Arnold Schwarzenegger said. In a statement released Friday, the governor said the program was "creating and retaining tens of thousands of jobs and generating spending in California." "This is exactly why I fought so hard for tax credits in last year's budget," Schwarzenegger said. "Just the first two years of this incentive will generate two billion dollars in direct spending, with even more to come." The program, passed last year, allows...

When California faced a major budget crisis in the early 1990s, thanks to what was then the worst recession since the Great Depression, a Republican governor – Pete Wilson – and the Legislature enacted a big, albeit temporary, increase in state taxes. Despite the boost in sales and income taxes, however, state revenue continued to decline as the recession deepened, touching off years of political debate over causes and effects. Those on the right contended that by increasing taxes, Wilson and the Legislature depressed economic activity, thus causing a further decline in revenue. Those on the left argued that if...

In 2004, Gov. Arnold Schwarzenegger barnstormed around the state for Proposition 58, using an oversized credit card as a prop and vowing that it was time for the state to "tear up its credit card." Now Attorney General Jerry Brown has concluded that Assembly Democrats' plan to borrow billions to help ease the state's $19.1 billion deficit could be deemed illegal under that ballot measure if challenged in court. "We conclude that a court could reasonably determine that the proposed transaction violates Proposition 58," the attorney general's office said in a letter to Schwarzenegger's legal affairs secretary. Assembly Speaker John...

Half of California voters believe the state should close its $19.9 billion deficit mostly or entirely through spending cuts rather than tax increases, according to a Field Poll released Tuesday. That compares with 29 percent who said the state should use an equal mix of spending cuts and tax increases, or 13 percent who prefer balancing the budget solely or mostly with tax hikes. Field Poll Director Mark DiCamillo said that with the economy still in recovery and the state having passed tax hikes last year, "tax increases are just not that popular a notion right now." "You're asking people...

Leadership: Alaska's ex-governor asks a question we'd like answered: Why is California's current governor pushing the same policies in Copenhagen that helped drive his state into record deficits and unemployment? The movie series that made Arnold Schwarzenegger a household name involved cyborgs traveling through time to alternately try to destroy or save one John Connor, who would grow up to be the leader of the resistance against a race of machines that ruled the planet. Prominent in the series was his tough cookie of a mom, Sarah Connor. Another Sarah has taken the lead in another resistance against another group...

On Nov. 1, the government of the state of California began withholding from workers' paychecks 10 percent more than what it had been withholding. The Los Angeles Times described this move -- prompted by California's fiscal calamity -- as "a forced, interest-free loan" from taxpayers to the government. The Times explained to its California readers that "You'll be repaid any extra withholding in April. Those who would receive a refund anyway will receive a larger one, and those who owe taxes will owe less." The ostensible purpose of withholding is to better ensure that taxpayers actually pay the taxes they...

Reporting from Los Angeles and Sacramento - Starting Sunday, cash-strapped California will dig deeper into the pocketbooks of wage earners -- holding back 10% more than it already does in state income taxes just as the biggest shopping season of the year kicks into gear. Technically, it's not a tax increase, even though it may feel like one when your next paycheck arrives. As part of a bundle of budget patches adopted in the summer, the state is taking more money now in withholding, even though workers' annual tax bills won't change. Think of it as a forced, interest-free loan:...

As the end of California’s fiscal year approaches, the Governor and state legislators confront a $24 billion deficit. While Republicans and Democrats wrangle over how to address the gaping shortfall, some members of the press have started to look for a scapegoat for the fiscal train wreck. Many have blamed the California taxpayer’s only protection: Prop. 13, the 1978 measure capping state property taxes at 1% of a home’s assessed value. Perhaps the most egregious example of the finger-pointing is a recent piece from TIME’s Kevin O’Leary, moaning that “Before Prop 13, in the 1950s and '60s, California was a...

As the end of California’s fiscal year approaches, the Governor and state legislators confront a $24 billion deficit. While Republicans and Democrats wrangle over how to address the gaping shortfall, some members of the press have started to look for a scapegoat for the fiscal train wreck. Many have blamed the California taxpayer’s only protection: Prop. 13, the 1978 measure capping state property taxes at 1% of a home’s assessed value. Perhaps the most egregious example of the finger-pointing is a recent piece from TIME’s Kevin O’Leary, moaning that “Before Prop 13, in the 1950s and '60s, California was a...

Democratic legislators trotted out a stick-and-carrot approach to closing the state's budget gap Sunday night, negotiating with the governor on one floor of the Capitol while voting for a package of cuts and taxes on another. Majority Democrats in the Assembly were voting late Sunday on a $23.4 billion package of spending cuts, tax and fee increases, and accounting tricks designed to close a gaping hole in the budget for the fiscal year that starts Wednesday. Unlike last week's efforts, when at least some Republican votes were needed to pass the bills so they could take effect immediately, Sunday's package...

About this time every year, as the Legislature and governor wrestle over how to pass the state budget, somewhere, somebody blames Sacramento's stalemate - and the state of the California's mediocre schools and crumbling roads - on Proposition 13. The wail usually echoes unanswered for a simple reason: Thirty-one years after California voters overwhelmingly passed the law that fixed the rate of property tax increases and required a two-thirds majority of the Legislature to raise taxes and approve state budgets, polls show that Prop. 13 is as popular as ever.But this year, with California and the nation in the throes...

In a controversial simple-majority vote Sunday night, the state Assembly approved raising taxes on oil production and tobacco products as part of a Democratic budget proposal that closes most of the $24.3 billion budget shortfall through June 2010. But the plan met immediate resistance when a spokesman for Gov. Arnold Schwarzenegger vowed that the Republican would veto such an end run around GOP lawmakers. Bills containing new taxes normally require a two-thirds majority to be enacted. "He will veto any majority-vote budget fix," said Schwarzenegger spokesman Aaron McLear. "I think this shows that the Legislature is not yet serious about...

California State Assembly Speaker Karen Bass, a Democrat, did an interview with the LA Times. Thought you may enjoy her response to the following question: How do you think conservative talk radio has affected the Legislature's work? Bass' response: The Republicans were essentially threatened and terrorized against voting for revenue. Now [some] are facing recalls. They operate under a terrorist threat: "You vote for revenue and your career is over." I don't know why we allow that kind of terrorism to exist. I guess it's about free speech, but it's extremely unfair. Now that's a first. I know that politicians...

California cities will sue the state if its new fiscal budget includes "stealing" local gas tax funds, leaders for the League of California Cities warned today. "Our intention is to be prepared to file a lawsuit the day after the budget is signed," Chris McKenzie, the league's executive director, said at a news conference in the Sacramento Convention Center. "The (state) Constitution and statutes have never authorized the state to steal gas tax funds."

SACRAMENTO – More budget gridlock appears on the way as legislative Democrats say they'll push for a tax increase and the governor says he'll veto it. For weeks, Democrats crafted a response to Gov. Arnold Schwarzenegger's proposal to balance a $24.3 billion budget deficit. Democrats don't like the governor's plan to close more than 200 state parks and eliminate core welfare programs such as CalWORKS and Healthy Families. Instead, the Democrats who control the State Legislature have proposed dialing back the governor's suggested cuts and replacing the lost savings with taxes on oil and tobacco as well as surcharges on...

Here’s how the Cal Chamber of Commerce pencils out the increased costs to businesses:* $2.5 billion by requiring businesses to pay 20% strict liability penalty on top of existing penalties for underestimating  tax liabilities of $1 million+.  The extra penalty went into effect June 1. Businesses will tend to overpay their taxes giving the state an interest-free loan with no deadline for refunds. * $2.4 billion for additional sales and use taxes because of the 1-cent hike starting April 1. Businesses pay 40% of sales taxes, the chamber says. * $2.3 billion because of a requirement that  instead of paying...