Budget accord? Not really, not yet

by Allen Young and Tom Chorneau

The happy sense that budget negotiators had turned a corner late last week and were headed for home seems to have dimmed some after legislative caucuses were briefed on the so-called framework of an agreement.'

Even though only a few details have still been released, as of Sunday afternoon there appears to be less of an agreement that some had suggested and a lot more work remains ahead to get a deal.

Sources close to Assembly Democrats said Friday that there was no agreement, especially on education funding which had been rumored to have been largely agreed upon at about $52 billion in Proposition 98 funding.

It could (come together and be voted on next week), that doesn't mean it will. It's getting down to where it's a crapshoot," said state Sen. Alan Lowenthal, D-Long Beach. "It's getting very close."

Insiders said that a suspension of Proposition 98 is on the table - something that the majority Democrats have already proposed. One issue that appears to be still in play is whether the suspension would also trigger a maintenance factor - something that the governor has tried to avoid.

Insiders are saying that the governor and legislative leadership of both parties have largely agreed to use expectations of more federal money and a rosy economic outlook to boost revenue projections and to reduce the need to cut programs more.

Facing a shortfall of about $19 billion, the negotiation team reportedly had agreed to limit spending cuts to $7.5 billion - far less than the $12 billion that the governor proposed.

A Democratic plan for an elaborate tax swap appears to have died, but there would seem to be support for delaying again implementation of corporate tax credits.

Lowenthal said the governor is still looking for some big ticket solutions in his final budget agreement.

"The big stuff is pension reform and all the other issues that go along with the budget that probably are as difficult as doing the budget itself," he said.

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