UNIONS HOLD THE WILD CARD ON PROPOSED STATE SPENDING CAP

By Kevin Yamamura | The Sacramento Bee

 

How ‘sweet’ does it have to be before the diabetes kicks in?  - Gov. Arnold Schwarzenegger urges support for six budget measures – topped by a state spending cap and school funding sweeteners – in a special election May 19. [BRIAN BAER Sacramento Bee file, Feb. 26 ]

Monday, Mar. 2, 2009 --Labor unions that blasted a state budget deal for its constitutional spending limit have gone quiet as the state gears up for a May 19 election asking voters to ratify the agreement.Campaign veterans believe Gov. Arnold Schwarzenegger and legislative leaders can only succeed in persuading voters to pass six budget-related ballot measures if unions remain on the sidelines.

Labor groups will hold internal meetings over the next month to decide how to proceed.

"That's the multimillion- dollar question," said Dan Schnur, a former Republican strategist who now directs the Jesse M. Unruh Institute of Politics at the University of Southern California.

"Initiatives like this only pass when there isn't much money spent against them," he said. "And the only people who have that kind of money and that kind of motivation are unions. If they decide to sit this one out, it probably passes."

Schwarzenegger hopes the special election will be nothing like the one four years ago, when he suffered multiple defeats at the hands of labor groups.

One immediate difference is that the powerful California Teachers Association has backed Proposition 1B to ensure that schools receive $9 billion in future years, one of the six proposals that Schwarzenegger and legislative leaders are selling as part of an overall "budget reform" package.

In 2005, the CTA worked against the governor by galvanizing opposition to his various ballot proposals.

The most controversial ballot measure this year is Proposition 1A, which establishes a cap on future state spending based on a trend line over the previous decade.

Public employee labor unions fear the measure would mean less money for government jobs, yet the cap was essential to winning Republican support for the budget package.

Unions last month were attacking the budget deal for including a limit on future state spending growth and $15 billion in cuts to state programs. The spending limit must be approved by voters in Proposition 1A to take effect.

Fearing that unions could mount a successful opposition campaign, lawmakers and Schwarzenegger crafted the budget deal so that increased taxes on income, sales and vehicles would last up to an additional two years if Proposition 1A passes.

The strategy assumed that the additional state tax revenue, worth as much as $16 billion between 2011 and 2013, would provide enough incentive for unions to let Proposition 1A go unchallenged.

Different branches of the Service Employees International Union, which represents tens of thousands of public-sector workers, are having internal discussions about what approach they want to take toward the ballot measures.

"We have always been against the spending cap," said Jeanine Meyer Rodriguez, spokeswoman for the state council of SEIU, representing 750,000 workers statewide. "We have to go through our internal process."

If unions decide to pony up money in the special election, they will find vocal partners in the Howard Jarvis Taxpayers Association, an anti-tax group usually on the opposite side of labor in public policy debates. The group opposes the tax hikes linked to Proposition 1A and believes the spending limit allows for too much growth in the state budget.

"I think the opposition is not only there, but I think it will grow the closer we get to May 19," said Jon Coupal, president of the Jarvis group. "It's well known that some bargaining units are not happy and may have motivation to oppose Proposition 1A. Politics makes for strange bedfellows."

Lawmakers and Schwarzenegger crafted the budget deal to win support from education groups. They placed Proposition 1B on the ballot to specify that the state would pay schools $9.3 billion beginning in 2011-12. They tied the measure to Proposition 1A, partly to discourage teachers unions from opposing the spending limit.

CTA President David Sanchez said that his group has taken an interim support position on Proposition 1B, but that it will take positions on all the measures at a state council meeting next month.

"We're going to be having a campaign to encourage electorate support for repayment back to schools," Sanchez said.

Schwarzenegger held a kickoff news conference Thursday for the six ballot proposals with Senate President Pro Tem Darrell Steinberg, D-Sacramento, former Senate Republican leader Dave Cogdill and leaders from business, public safety and construction groups.

The governor plans to build a substantial war chest in case any financial heavyweights emerge to oppose the six budget-related ballot proposals.

Schwarzenegger, who has set gubernatorial fundraising records, already has the support of major business-backed groups, including the California Chamber of Commerce and the California Taxpayers Association.

"We will get enough money together so we can have an effective TV campaign because even though there's no opposition at this point, you never know," Schwarzenegger said last week. "We want to make sure that if there is opposition coming up and spending money against it, that we have enough money available to push back and get the message out."

The unions may not be Schwarzenegger's only concern.

Republican gubernatorial candidate Meg Whitman, a former eBay CEO whose net worth has been estimated at more than $1 billion, hasn't ruled out using the special election as a means to court the party's anti-tax base by spending heavily to oppose Proposition 1A. She already is on record opposing the measure.