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Scott Wilk: The loss of ‘super-majority’

Posted: May 16, 2014 2:00 a.m.
Updated: May 16, 2014 2:00 a.m.

Just as their households must, Californians expect their state government not only to live within its means, but to work in a bipartisan way for the benefit of all.

This past week, the governor and legislative leaders did just that.

Thankfully, with bipartisan negotiations, we were able to reach a compromise on a deal that would benefit all Californians — Assembly Constitutional Amendment 1XX, which creates a real “rainy day fund” that will go before the voters this fall.

As a co-author of ACA 1XX, I am pleased to see that establishing a reserve fund is finally a top priority in Sacramento.

Under the plan, the state will actually save money into a rainy day fund, one that cannot be simply suspended by Executive Order or raided by a simple majority vote, and that will provide money to prevent painful cuts to education and public safety during economic downturns.

Prior versions required a 3 percent contribution per budget year; however, ACA1XX more realistically cuts the annual contribution to 1.5 percent but also requires the fund to be replenished with any additional revenue from capital gains taxes when the stock market has good years.

For the next 15 years, half of the rainy day fund would be dedicated to paying down state debt and liabilities, estimated at $340 billion.

California’s current budget is about $100 billion, and the state would set aside at least $1.5 billion for the rainy cay fund.

The current deal also creates a reserve for education spending, which wouldn’t operate until schools funding is fully restored to pre-recession levels.
ACA 1XX also includes a key component that my colleagues and I have been pushing for, the “three day in print” rule.

This requires all legislation, particularly budget bills, to be in print and online for at least 72 hours prior to any vote to ensure that all Californians are able to review the budget before it’s enacted.

For 10 years, we have had a so-called rainy day fund set up by Proposition 58 that has saved very little, if anything.

In 2010, ACA 4, a stronger version of the law, became part of the budget compromise that required a 3 percent annual contribution from the state’s general fund and was supposed to have been put before the voters.

But Democrats, armed with their newly minted super-majorities, instead refused to place that measure before the voters, allowing them to continue to overspend in prosperous years.

No money was saved in 2012-13, when tax revenue grew by $11.4 billion.

Unfortunately for the majority, with the persistence of the economic downturn and the dramatic fluctuations in revenues, the need to strengthen the rainy day fund would not go away.

But the governor’s original proposed plan again had so many loopholes in it you could drive a bullet train through it.

While it would have been nice if the motivation of the governor and the Democratic leaders to include Republicans in negotiations stemmed from a genuine desire to strengthen the rainy day fund, the cold, hard truth was that the

Senate super-majority had been lost through the suspensions of three Democratic senators.

So the Democrats needed Republican votes to move the measure to the governor’s desk for signature.

However we got here, we now have for California voters to approve a reliable rainy day fund that cannot easily be siphoned off and will actually be there to pay down debt and cover basic priorities in tough years.

Whether it is the budget, the rainy day fund, tax increases, new fees and regulations on business, or anything else, if the recent negotiations on the governor’s rainy day fund demonstrate anything, it is that when both parties and their policy improvements are included, California gets a better product — and California is the better for it.

Scott Wilk is a Santa Clarita Valley Republican who represents the 38th Assembly District in the California Legislature.


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