There are a lot of problems with the Big 5/Big Taxes plan — some of which are a function of a broken process. The super secret-squirrel negotiations result in a scrambling of speedy analysis, trying to figure out what is really in the package.

State Senator Bob Dutton, who ironically is the Vice Chairman of the Senate Budget Committee, like everyone else has been scrambling to look into the details of the plan, having had it sprung on him just like everyone else.

One interesting analysis that his staff did was they looked over the stated $15.1 billion in cuts in the plan. Guess what they found? Yep, State Capitol "double speak" is alive and well.

Attached is a document (excel format) that details the sad truth, which is that if you apply the traditional "normal" definition of cuts (you know, were we actually reduce the amount of money on a program, as opposed to "cutting an anticipated increase" — or how about calling cuts items that have to be paid back?

Anyways, by the take you take out the "cuts that aren’t cuts" — the real cuts in this package are only $3.1 billion —… Read More

Kudos to CalTax for picking up on the Board’s reluctance to give up extra resources with regard to the new Flavored Malt Beverage regulation (link).

When we adopted the regulation last year, over my objections, the Board told the Department of Finance to expect $38 million in revenue for the fiscal year. As I warned repeatedly, it turns out the regulation is unenforceable and easily dodged.

The companies this regulation sought to punish simply changed the formula in their products so they no longer contain distilled alcohol. As a result, year-to-date, the state has collected only $6,000 of revenue. (Yes, that means our expert revenue estimates were off by 6,333%) To gear up to collect this tax we asked the Department of Finance for more money. Finance now understands how ridiculous this tax is and they want the BoE to completely withdraw the request. I agree with Finance. With a hemorrhaging state budget this should be a very simple decision to save the state money.

The BoE is asking for $1,328,000 (General Fund) in Fiscal Year 2009-10. Now that we… Read More

Our esteemed editor Jon Fleischman posted a John Fund commentary on the state budget crisis, in which Fund mentioned speculation that Darrell Steinberg and Karen Bass might pass a tax hike on a majority vote.

I say: please, go right ahead. Not only would it be declared unconstitutional, but California voters would be presented with an enormous, purely Democratic tax hike.

I’m all for clarity, and in this case such a rash action by Bass and Steinberg would make it crystal clear to California voters that the Democrats are the party of higher taxes, the party of raiding working family budgets rather than restraining the state spoending spree.… Read More

What has your Assemblyman done for you lately?

According to Capitol Weekly and Hagman COS Mike Spence, the Assemblyman pulled two people out of a burning car that had crashed near his Sacramento apartment last night.

The drive ran off after Hagman pulled him from the burning vehicle which later exploded. The passenger, a woman allegedly blew a .33 on the breathalyzer… Read More

The Lincoln Club of Orange County has sent a letter to the State GOP Legislative leaders and Senators Maldonado and Cox urging them to oppose the current budget deal.

See the link to the letter below.… Read More

From today’s Wall Street Journal Political Diary E-mail…

Purified by Fire

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We salute the thirteen members of the State Senate Republican Caucus who have held the line against a plan that would saddle as much as $70 billion of tax increases over the next five years on California taxpayers.

THANK YOU SENATORS AANESTAD, BENOIT, COX, DENHAM, MALDONADO, HARMAN, DUTTON, HOLLINGSWORTH, HUFF, RUNNER, STRICKLAND, WALTERS AND WYLAND.

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California’s Democrat legislators must be salivating. To be so close to redistributing another roughly $1400 per family straight out of their budgets and into the state budget must be tantalizing to them – because, as everyone knows, politicians in Sacramento know how best to spend the money earned by working Californians, right? Never mind that we are in the middle of very difficult economic times, when raising taxes by this massive amount with be the deciding factor on why some California businesses close, why jobs are lost, why houses go into foreclosure, and more.

Fortunately for California taxpayers, Republican lawmakers get it. They understand that there is never a good time to raise taxes, and that there are certainly worse times to do so – and this is one of those times. The drive that Democrat lawmakers, and Governor Schwarzenegger, and a handful of GOPers have to pass this Big 5/Big Taxes budget plan that notoriously contains over $14 billion in new taxes on cars and car registrations, as well as sales and income taxes is amazing.

Last night, as he adjourned the State Senate until 10am this morning, State Senate President Darrell Steinberg… Read More