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9.A -5 THE BUDGET STORY - SOME PRESS QUOTES Editorials, Columns, Opeds, Letters to the Editor The San Francisco Chronicle, 4/19/03, Wounded in the budget battles. "To put it bluntly, many local officials feel shafted by the budget process now unfolding in Sacramento... Despite repeated requests, Gov. Davis has yet to meet directly with the associations representing cities, counties and special districts. He should do so immediately. Cities and counties, which provide essential services to all Californians, deserve to be consulted at every step of this nightmarish exercise to close what could end up being a $40 billion budget shortfall." The Los Angeles Times, 04/20103, THE TERM LIMITS DISASTER — Birth of a Budget Impasse. "There are multiple reasons for the impasse, but many public policy experts see the problem as a legacy of the nation's most restrictive legislative term limits law, adopted by California voters in 1990 with the passage of Proposition 140. "The debate on a remedy should begin now. What the people created, the people can fix." Upon approval by a majority of voters, all revenue generated by the tax would be for discretionary use. Local governments would have the option to use these new funds to maintain services upon which their residents rely. "Should our economy quickly rebound and state and federal assistance return, the insurance policy of AS 1690 may not be needed. But to deny cities and counties this optional life preserver could be fiscally unwise." Sacramento Bee, 4/22/03, Dan Walters Column, As voter disgust mounts, a partial budget crisis deal takes shape. "The mounting public disgust at the Capitol's foot - dragging, coupled with a spate of newspaper articles about Assembly Speaker Herb Wesson giving high - paying jobs and consulting contracts to out-of -work politi- cians, appeared to be penetrating the building as legislators returned from their vacations. "Legislative sources said that Wesson and the Republican leader of the Assembly, Dave Cox, are on the verge of making the first major bipartisan deal on the budget —a package of spending cuts and loans that could eat into the deficit by as much as $5 billion. The San Francisco Chronicle, 4/22/03, Oped by Assembly Member Mark Leno, Legis- lative Priorities — A lifeline for California's cash - strapped municipalities. "Ominous signs are aligning to form a perfect storm on the fiscal horizon for local government. Rather than assisting states in the reinvestment of our schools, hospitals, transit systems, roads and bridges, the federal government has decided to return billions in tax cuts to the wealthy... I understand that our local governments simply cannot be expected to single - handedly solve all of these impending crises. California's tax structure binds the hands of local governments and limits their ability to provide for themselves. We need to consider a way to blunt this storm. "One answer is AB 1690, a bill I have authored this year that offers an optional local insurance policy to ensure that our infrastructures of health, education, housing and transportation are not seriously damaged. The measure would authorize a locally enacted income tax for cities and counties. "A big piece of the deal would be issuing about $1.5 billion in bonds to finance the state's pay- ments to public employee and teacher pension funds. Davis had proposed that all of the state's 2003 -04 pension obligations be covered by loans, thus knocking about $2 billion off the deficit that he pegs at $35 billion. But Republican senators balked, saying they would accept the scheme only if it was paired with major spending cuts." The San Diego Union Tribune, 4/22103, Doomsday nears— Clock ticks millions as budget cuts delayed. "Each day's delay in dealing with this crisis is costing the state millions that it will be compelled to repay the Wall Street fines that finance our monstrous debt. This is why Senate Minority Leader Jim Brulte, R- Rancho Cucamonga, conceded that it's going to take two years for the state to dig out of its $35 billion hole. It also explains why lawmakers are pondering the sale of $8 billion in bonds to help balance the books. Continued on Page 12 Visit the League's Official Web Site-- www.yacities.org PRIORITY FOCUS /PAGE 5