- The Senate voted along party lines Monday to nearly triple
the fee car owners pay to renew license-plate tags, a move that would raise
$4 billion a year.
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- But Gov. Gray Davis hinted that he might veto the legislation.
He said he would reveal his strategy this morning.
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- If Davis were to sign the measure, the fee increase could
take effect as early as May 6, legislative budget analysts said.
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- The increase would raise the fee for a $20,000 car from
$160 to $437. That's based on hiking the assessment from 0.65 percent of
current market value to 2 percent, and adding $37 in flat fees, according
to the Department of Motor Vehicles.
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- The Senate passed the measure 23-16. The upper house,
like the Assembly, also passed state program cuts in the current year totalling
$3 billion. But the legislation specifies that none of the cuts can take
effect in the absence of Davis signing the car fee increase.
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- Combined with the car tax revenue, the measures would
provide about $7 billion, or one-fifth of the money needed to overcome
an estimated $35 billion deficit. The Legislature still must come up with
a new budget for fiscal 2003-04, which begins July 1, and address Davis'
package of proposed sales, income and cigarette taxes.
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- "For a very long time, I've said I didn't like linking
the VLF (vehicle license fee) to the cuts that were being made in both
houses," Davis said. "I've also said that the cuts are not deep
enough."
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- Davis was seeking cuts almost twice as large, as state
officials prepare to try to convince Wall Street rating firms that California
is addressing its fiscal problem aggressively and responsibly. Finance
Director Steve Peace and Treasurer Phil Angelides are scheduled to travel
to New York on Wednesday for the meetings.
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- Davis said majority Democrats polarized the deficit issue
by insisting on raising the car tax, against the strong objections of both
Republicans and the Democratic governor. He warned that Republicans may
now be even less inclined to work with Democrats on Davis' package of cuts
and tax increases to solve the problem.
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- Davis noted Democrats need at least six Republican votes
in the Assembly and two in the Senate to approve a budget on the required
two-thirds vote. "Balancing the state budget requires a global solution
on a bipartisan basis, not a partial solution on a partisan basis,"
he said.
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- Said Peace: "It would do us no good to have a great
first inning, to score a lot of runs in the first inning, if we do not
win the game.
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- Sen. Bill Morrow, R-Oceanside, who voted against the
package Monday, said a legal challenge is almost certain if the legislation
is signed. Both houses passed the car tax on simple majority votes, and,
said Morrow, "I'm of the belief that it requires a two-thirds vote."
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- Peace said lawyers in the Department of Finance feel
uncomfortable defending the state against a challenge. But they believe
they can defend existing law, which he said already provides a trigger
to raise car fees if state finances are in shambles.
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- The Senate approved the following cuts Monday:
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- # $2.5 billion for grades K-12. However, $1.1 billion
is accomplished through a bookkeeping trick of delaying a June payment
to schools a few weeks until July, so it is counted against the next fiscal
year.
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- # $700,000 from cities and counties.
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- # $133 million for community colleges.
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- # $131 million for the University of California and California
State University.
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- # $1.3 million by shortening the 16-week training program
for correctional officers to 12 weeks.
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- The measures also raise $26.6 million in new revenues
by substantially increasing fees businesses and cities pay for air and
water quality programs, and transfer $186 million to the general fund from
other state funds.
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- Contact staff writer Dave Downey at (760) 740-3529 or
ddowney@nctimes.com.
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- http://www.nctimes.net/news/2003/20030204/11111.html
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