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CA: Governor OKs borrowing plan
Sac Bee ^ | 12/5/03 | AP

Posted on 12/05/2003 8:45:39 PM PST by NormsRevenge

Edited on 04/12/2004 6:01:53 PM PDT by Jim Robinson. [history]

After saying for weeks there would be no option for putting a big bond measure on the spring ballot, Gov. Arnold Schwarzenegger quietly gave the green light Friday to a plan to borrow $10.7 billion without voter approval.

Last summer, the Legislature authorized the bond sale as part of the budget agreement signed by former Gov. Gray Davis. But taxpayer groups, as well as many Republican lawmakers, criticized the deal, saying borrowing of that magnitude should be approved by voters.


(Excerpt) Read more at sacbee.com ...


TOPICS: Business/Economy; Government; Politics/Elections; US: California
KEYWORDS: borrowingplan; calgov2002; catrans; governor; knife; schwarzenegger

1 posted on 12/05/2003 8:45:39 PM PST by NormsRevenge
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To: *calgov2002
.
2 posted on 12/05/2003 8:45:57 PM PST by NormsRevenge (Semper Fi)
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To: NormsRevenge
That's what they get for electing a RINO.
3 posted on 12/05/2003 8:48:03 PM PST by xrp
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To: NormsRevenge
The time is coming soon when it will emerge whether Arnold is an enabler or a reformer. He needs to make it clear he is going the intiative route if laws are not passed that reign in the instincts of a legislature that is highly unprepresentative of the state on inter alia fiscal matters.
4 posted on 12/05/2003 8:49:51 PM PST by Torie
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To: NormsRevenge
Yawn. The press often acts as though Conservatives have betrayed their fellow Conservatives, only to be proved wrong after the dust settles.

Lets see what gets put on the bond measure for the voters to approve before swallowing such stories as this one from a liberal rag...

5 posted on 12/05/2003 8:51:32 PM PST by Southack (Media bias means that Castro won't be punished for Cuban war crimes against Black Angolans in Africa)
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To: xrp
Too early for that verdict. It may be just a move of a pawn, or a move to buy time, for some other "solution." The illegal debt cannot all be retired in one year absent Draconian actions, that while meritorious, simply are not going to happen. McClintock lost, so such actions will not even hit the ballot for an up or down vote. And so it goes.
6 posted on 12/05/2003 8:52:08 PM PST by Torie
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To: Southack
I am sure we disagree on something, somewhere. I am not sure what that is. :)
7 posted on 12/05/2003 8:52:55 PM PST by Torie
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Comment #8 Removed by Moderator

To: William Creel; All
Let's not drag this thread down the same road that so many have gone. Thanks

This is a very sad situation that we all find ourselves in as California is the albatross around our nation's chance to have a robust recovery for all in the near future.

The decision by the demRats to continue to fight & obstruct the will of the people is despicable and will be addressed in November 2004.

Until those elections results are in, a lot of folks will be running around stabbing each other and wasting the energy they need to be directing at the real culprits in this whole sordid mess.

9 posted on 12/05/2003 9:21:02 PM PST by NormsRevenge (Semper Fi)
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To: NormsRevenge
The "hate" Arnold crowd is sure not giving him any slack. He is just completing his third week in office and they are already at his throat.

They let Davis screw California up for five years and they still wanted him to stay longer - but they won't give Arnold a month.
10 posted on 12/05/2003 9:46:32 PM PST by CHUCKfromCAL
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To: NormsRevenge
I watched a portion of the committee meeting chaired by the Long Beach Democrat gal today as the Governors plan for the Bond initiative was presented to the committee and the Demoncrats acted as though they had till Christmas of 2004 to make decisions on what to do!
11 posted on 12/05/2003 9:47:14 PM PST by Ernest_at_the_Beach (Davis is now out of Arnoold's Office , Bout Time!!!!)
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To: CHUCKfromCAL
Poor Arnie. *Sniff*
12 posted on 12/05/2003 9:47:16 PM PST by Kevin Curry
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To: CHUCKfromCAL
broad brushes usually splash paint all over everyone. Thanks but "hate" is a bit strong , imo, of how most folks feel these days.
13 posted on 12/05/2003 9:51:49 PM PST by NormsRevenge (Semper Fi)
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To: CHUCKfromCAL
CHUCKfromCAL said: "They let Davis screw California up for five years and they still wanted him to stay longer - but they won't give Arnold a month."

There may be many who voted for Arnold who "let" Davis screw Kalifornia, but I doubt that there are many who voted for McClintock who let Davis do anything.

As for giving Arnold a month, why do you ask that from us? Is there some "secret sauce" which is going to make borrowing $15 billion suddenly palatable?

I was in support of challenging the legality of Davis' "deficit bonds" and hoped that the voters would reject a replacement bond issue if it came to that.

Now that Arnold is going down a similar track, I support the challenging of the legality of the "deficit bonds" and hope that voters will reject a replacement bond issue.

The backlash which has caused the legislature to repeal the drivers licenses for illegals was probably going to happen without Arnold. The same might have been true of the car taxes. Several more months of calamitously depressed auto sales might have done the trick.

The fiscal train wreck which is Kalifornia continues down the track. Arnold is "driving" but not much else has changed.

14 posted on 12/05/2003 10:08:02 PM PST by William Tell
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To: William Tell
Reinstating reduced VLF without continuing backfill payments to counties for lost revenue is causing a crisis in County government. Without immediate action by legislators and Governor, cities and counties will receive significantly reduced Vehicle License Fee Revenues beginning December 10, 2003. Payments could be reduced by more than two-thirds or more than $300 million per month.

VLF payments constitute an average of between 17 and 25 percent of city and county general purpose revenues respectively. The General fund is the primary revenue for the Sheriff, D.A., Fire, Assessor, Auditor, Clerk, Recorder, Probation and Administration. Another 25% cut in our General Fund will endanger public health and safety.

Governor Schwarzenegger and the Legislature must keep the promise to backfill revenues that the State has diverted from the Counties and cities.

15 posted on 12/05/2003 10:26:39 PM PST by marsh2
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To: William Tell
The secret sauce is the tax increase coming soon to pay off the bond with the hefty interest.
16 posted on 12/05/2003 10:26:47 PM PST by FirstPrinciple
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To: William Creel
The people who were bitter that Tom lost, don't seem to be acting level-headedly when it comes to Arnie.

Yeah, all those people who were sure Tom would win are bitter.
What are you smoking tonight?

17 posted on 12/05/2003 10:29:17 PM PST by Lancey Howard
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To: Southack
Lets see what gets put on the bond measure for the voters to approve before swallowing such stories as this one from a liberal rag...

The story's from the AP. Schwarzenegger's green lighting Davis' $10.7 billion dollar bond scheme to bypass the voters.

It's as illegal now as when Davis tried it.

It's in violation of the California Constitution.

After saying for weeks there would be no option for putting a big bond measure on the spring ballot, Gov. Arnold Schwarzenegger quietly gave the green light Friday to a plan to borrow $10.7 billion without voter approval.

Last summer, the Legislature authorized the bond sale as part of the budget agreement signed by former Gov. Gray Davis. But taxpayer groups, as well as many Republican lawmakers, criticized the deal, saying borrowing of that magnitude should be approved by voters.

One group, the Pacific Legal Foundation, filed a lawsuit in September, arguing the proposal to sell $10.7 billion of deficit-financing bonds should be ruled invalid because of provisions in the California Constitution that prevents the Legislature from taking on more than $300,000 in long-term debt without approval of the voters.

More on the Davis' illegal $10.7 billion bond that Schwarzenegger is trying to resurrect...

Schwarzenegger's bond plan would replace a $10.7 billion bond issuance by former Gov. Gray Davis that's being contested in court, and would shore up the state's spending plan through June 2005. His finance director, Donna Arduin, told state lawmakers last week that Schwarzenegger's $15 billion plan and the $10.7 billion in legally questionable debt back each other up: one or the other is necessary, but if both fail the state will run out of money by the end of the fiscal year in June.

The $15 billion deal is vital to Schwarzenegger's budget plans, which also includes $3.8 billion of cuts in the budgets for this and next year and a spending cap.

"If we don't have that, and the $10.7 billion bond falls through in court, then we have no money and then we have to make cuts that are disastrous," Schwarzenegger said.
Schwarzenegger Says Bond Plan Is State's Only Hope
Governor Says He Has No Backup Plan
NBC San Diego.com - December 2nd, 2003

But on the campaign trail, Schwarzenegger said...

We need to get our spending under control. I support a constitutional limit on annual spending increases, a "rainy day" reserve fund and an unambiguous constitutional requirement that the state pass a balanced budget so that California never finds itself in this mess again. I will also restructure our inherited debt, estimated at between $12 and $20 billion - a very wide range that is itself another indicator of how difficult it has become to understand just what is going on in Sacramento. This includes the unprecedented $10.7 billion deficit bond and other borrowing in the current budget.
Arnold Schwarzenegger - Schwarzenegger Campaign website

Schwarzenegger promised to control spending without raising taxes, but most of his efforts to control the budget shortfall revolve around borrowing, which only mean higher taxes later.

If a Schwarzenegger bond measure ever does reach the voters, it should be treated like any other... with a no vote.


18 posted on 12/05/2003 10:29:50 PM PST by Sabertooth (Credit where it's due: saveourlicense.com prevented SB60, and the Illegal Alien CDLs... for now.)
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To: Sabertooth
I watched the committee meeting where some of the democrats wanted this plan to go forward.

They were in no hurry to vote on the Governors plan that had just been presented to them.
19 posted on 12/05/2003 10:37:23 PM PST by Ernest_at_the_Beach (Davis is now out of Arnoold's Office , Bout Time!!!!)
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To: Sabertooth
Frankly, the real political hat trick would be to break the budget down into small components and put every tiny component onto the statewide ballot. Let the voters approve what they consider vital, and let them say no to the rest.

California has "direct democracy" available as an option. Bypass the California legislature and use that option. Let the voters choose their level of taxation and their preferred level of spending on the same ballot each year.

As for Arnold, lets wait to see what he puts on the ballot before deeming him a traitor. It's also reasonable to give him some small amount of leeway in how he handles the enormous problems that are now in his lap. A one-time bond issuance isn't out of the question if he simultaneously shows how such borrowing won't be required in the future due to systematic budget cuts.

That he can't swing an axe that large all in his first 6 weeks in office shouldn't really be the full measure of the man...

20 posted on 12/05/2003 10:45:09 PM PST by Southack (Media bias means that Castro won't be punished for Cuban war crimes against Black Angolans in Africa)
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Comment #21 Removed by Moderator

To: Southack
Frankly, the real political hat trick would be to break the budget down into small components and put every tiny component onto the statewide ballot. Let the voters approve what they consider vital, and let them say no to the rest.

This is why I vote no on all bonds. We never get a choice to fund welfare or not, it's always schools, police, and fire.

As for Arnold, lets wait to see what he puts on the ballot before deeming him a traitor.

Arnold can't put anything on the ballot. Only the voters or the legislature can do that.

Schwarzenegger's attempt to revive Davis' illegal $10.7 billion bond is illegal precisely because it bypasses the voters.


22 posted on 12/05/2003 10:54:36 PM PST by Sabertooth (Credit where it's due: saveourlicense.com prevented SB60, and the Illegal Alien CDLs... for now.)
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To: Sabertooth
"Schwarzenegger's attempt to revive Davis' illegal $10.7 billion bond is illegal precisely because it bypasses the voters."

Yes, at least, so says the Sac Bee.

But lets wait to see if those bonds appear on the March ballot in spite of what the Sac Bee says.

Arnold could end up being right here, and the Sac Bee could just be blowing smoke up our collective arses.

Liberal rags have been known to sow dissent, even if it means outright lying, among Conservatives, after all.

23 posted on 12/05/2003 10:57:55 PM PST by Southack (Media bias means that Castro won't be punished for Cuban war crimes against Black Angolans in Africa)
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To: Southack
I heard from Tom Sullivan that approx 10 bil of the 15 is restructuring (refi) of the $ davis arranged to borrow.
24 posted on 12/05/2003 11:01:07 PM PST by going hot (Happiness is a momma deuce)
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To: Sabertooth; RJayneJ; JohnHuang2; Jim Robinson; Nick Danger; Lazamataz; NYC Republican; ...
"This is why I vote no on all bonds. We never get a choice to fund welfare or not, it's always schools, police, and fire."

I'd love to see a FReeper letter-writing campaign send in emails to various newspapers asking why voters are never given the chance to *CUT* various parts of the full budget.

I mean, are we a Democratic Republic, or what?!

25 posted on 12/05/2003 11:01:59 PM PST by Southack (Media bias means that Castro won't be punished for Cuban war crimes against Black Angolans in Africa)
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To: Southack
>>>... why voters are never given the chance to *CUT* various parts of the full budget.

In Colorado, we have have TABOR, the strictest tax and spending limitation of all 50 states. It's worked fine for a decade now.

26 posted on 12/05/2003 11:24:40 PM PST by Reagan Man (The few, the proud, the conservatives.)
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To: Reagan Man
TABOR is good, but even TABOR fails to allow citizens the opportunity to literally CUT budgets.
27 posted on 12/05/2003 11:33:05 PM PST by Southack (Media bias means that Castro won't be punished for Cuban war crimes against Black Angolans in Africa)
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To: NormsRevenge
It's illegal and he knows it.
28 posted on 12/06/2003 7:41:38 AM PST by Carry_Okie (There are people in power who are truly evil.)
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To: NormsRevenge
The Davis bond is unconstitutional. We're simply marking time til the bottom drops out from the state budget. I can't wait to see California go bankrupt and then cold reality will set in.
29 posted on 12/06/2003 12:42:01 PM PST by goldstategop (In Memory Of A Dearly Beloved Friend Who Lives On In My Heart Forever)
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To: marsh2
marsh2 said: "Governor Schwarzenegger and the Legislature must keep the promise to backfill revenues that the State has diverted from the Counties and cities. "

Hmmm...

There are 58 counties in Kalifornia last time I looked. And a fair number of larger cities.

I am sure that the flow of money from state to counties is justified in the case of schools by a concern that "no child be left behind". We might as well keep up the pretense of local control.

How, though, do we justify having money flow from the state to counties and others for police services? Or for any other function which is administered by the individual counties? How much money would be saved by requiring every county to combine with a neighboring county to increase efficiency? Businesses are faced with this reality all the time.

30 posted on 12/07/2003 4:27:46 PM PST by William Tell
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To: William Tell
The VLF is personal property tax and is a County revenue stream. Years ago when the State had budget surplus, it passed that through to car owners by funding a discount in their vehicle tax. They did this by discounting the tax and backfilling the counties and cities for the lost revenue.

When the budget no longer produced surplus revenue, the VLF was supposed to return to full undiscounted amount. (Eliminating the need to backfill the County.) What Gov. Schwarzenegger did was continue the discount without the backfill - thus shifting the burden to the Counties and Cities for his largess. The loss of backfill will cost the Counties about 25% of their revenue stream and the cities about 17%.

There is a similar issue with Williamson Act funds. The legislature passed this open space law giving a discount to property owners who would sign a 10 year contract to keep their land in farms and open space. The State backfills the Counties for the loss in property tax reveue. What keeps coming up in these hard times is that the State wants to discontinue the backfill. That leaves the Counties holding the bag with a 10 year contract for reduced taxes and no backfill. That stream is about 17% of our local property tax revenue.

With increased workers comp., liability and other insurance and the cost of the union negotiated PERS benefits, we already cut 12% from the budget in June. We cut another 2 million in September because of lost revenue from a 3 month lag in VLF backfill payments from the State and elimintaion of rural crime funding. We were not allowed to cut manadated costs that had already been shifted to the Counties for programs like adminsitration of IHSS - In Home Social Services for the elderly and disabled.

With full elimination of the VLF and everything else, we will end up having to cut about 32-36% of our budget. That is way too much a cut for basic local services such as police, fire, courts, jail and libraries to continue. This is cutting programs that benefit all of the community in basic public health and safety in order to fund entitlement programs that benefit only a few. (Public Health, Human Services and Behavioral Health are not funded by the County general fund.)

What local services are in the General fund? - sheriff, D.A., fire, grand jury, library, animal control, juvenile hall, probation, public defender, homicide, law library, county courts, elections, tax collector, assessor, auditor, county clerk, recorder, administration, building dept., planning, airports, veterans services, Board of Supervisors, county museum, aid to indigents, indigent ambulance and medical care, state correctional school, and wards of the court.

31 posted on 12/07/2003 6:09:06 PM PST by marsh2
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To: marsh2
marsh2 said: "Years ago when the State had budget surplus, it passed that through to car owners by funding a discount in their vehicle tax. They did this by discounting the tax and backfilling the counties and cities for the lost revenue. "

Thanks for the information. It sounds like you are standing on the tracks in front of the runaway Kalifornia budget.

Prior to all this liberal meddling, property taxes, on both real and personal property, were the revenue source for counties, as I understand it.

I pointed out to my wife recently that the VLF [ Vehicle License Fee ] was a net benefit to us as higher income Kalifornians who drive older vehicles. We are personally much better off having the state raise money this way rather than boosting income taxes or ( DON'T TOUCH THAT THIRD RAIL !!!) residential property taxes.

Those who find themselves in this bind should be particularly enraged at the theft of sovereignty that this backfill scheme represents. I am sure that the typical county in Kalifornia is ruled by liberals who were delighted to use the taxing power of the state to encourage open space. Now, having agreed to let the state put its hands in their pockets they (and you) are reaping the consequences.

Personally, I would welcome whatever level of economic disaster will cause the state of Kalifornia to cease infringing my right to keep and bear arms. Many with less severe attitudes might wish to preserve the libraries.

I have a friend who runs a small business which is now about a year behind schedule in preparing new premises for expansion due entirely to regulatory issues, many of which the bureaucrats are unable to anticipate. They don't let him know what they want until it has a delaying effect on his progress. He would probably welcome the bankruptcy and dis-incorporation of the city responsible.

On a different thread I listed the first dozen or so agencies listed on the Kalifornia state web page. Among them were the "African-American Museum". I don't think the state supports an "Irish-American Museum" so I think this could be eliminated. Perhaps to keep your county running you would agree. This could be a marvelous opportunity to reduce the size of government in Kalifornia.

32 posted on 12/07/2003 7:01:02 PM PST by William Tell
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