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Wednesday, March 23, 2011

Outlines of Plan B on the State Budget? Or Negotiating?

Gov. Brown has been hinting that - if he can't get Republican votes in the next few days to put tax extensions on the ballot - he will do something else to get on the ballot. Example:

Brown considering other paths on taxes as Republicans stand firm in talks

Steven Harmon, Contra Costa Times, 3/22/11

SACRAMENTO -- As Gov. Jerry Brown continued to negotiate with Republican legislators on his plan to extend taxes, he also has begun to weigh going it alone, sources said Tuesday.

That could take two paths -- forcing a special election onto the ballot through a majority vote in the Legislature, or going forward with an initiative campaign for November. The more likely route, sources said, would be with a November election rather than risking legal challenges to muscling it through on a majority vote.

Brown is seriously considering a November initiative campaign, two Republicans speaking on background said they've been told...

Full article at http://www.contracostatimes.com/politics-government/ci_17674559

The problem with the above versions of Plan B are that they carry major risks. A November ballot would mean that the tax "extensions" become tax "increases" since the temporary taxes that Brown wants extended expire June 30. The majority-vote strategy raises legal questions which could delay plans for an election if raised in court. In particular, such litigation could delay any majority-vote election beyond June so - again - the extensions become increases. Opinion polls suggest voter support for extensions but not for increases.

Any election held after June creates an additional problem. The budget (which can be passed by a simple majority) will assume tax extensions/increases. If voters don't approve, the budget would be seriously out of whack and a drastic correction would have to be made part way into the fiscal year.

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