SAN FRANCISCO - The California Legislature's special session on the state's $11 billion budget deficit for the current fiscal year ended last week without any agreement on how to solve the ballooning budget problem.
Democratic lawmakers forced a vote on a plan that would have cut spending and raised taxes by $16.2 billion over the next year and a half to rein in a deficit that's expected to balloon to $17 billion next year, but the plan fell short of the two-thirds majority needed to pass California tax hikes. It garnered no Republican votes.
"There was a total failure on the Legislature's part," Republican Gov. Arnold Schwarzenegger said at a press conference. "It's like a kindergarten up there."
Lawmakers approved a $102 billion general fund budget for fiscal 2008-09 in September, almost three months late, but the budget was shown to be deep in deficit and to require revision.
The state's economy is slowing sharply, slowing tax collections. The California unemployment rate jumped to 8.2% in October, up a half percentage point from a month earlier and 2.5 percentage points from a year ago.
A newly elected group of lawmakers takes over on Dec. 1 and is expected to begin a new special session on the budget crisis soon thereafter. Democrats will again have a majority in the Legislature, but they will still lack the supermajority needed to pass budgets and tax hikes.
The Democrats' budget plan would have reduced spending by $8.1 billion, including a $4 billion cut in school funding over two years. The plan would have also cut spending on welfare for blind, disabled, and poor people, funding for state universities, and public transit.
It would have raised $8.1 billion by tripling vehicle license fees and freezing tax brackets at 2007 levels, resulting in some taxpayers paying higher taxes.
Republicans opposed the plan because they said it would not cut enough to solve the $28 billion deficit over the next year and a half and because it lacked spending caps they support. They continue to oppose tax increases because they say they will hurt the economy when it can least afford it.
