Mar 7, 2008 5:45 pm US/Pacific
Governor Considers Tax Hike To Fund Calif. Schools
OAKLAND (BCN) ―
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Schwarzenegger talks with reporters in Oakland.
CBS
Gov. Arnold Schwarzenegger said Friday that "everything is on the table," including tax hikes, to help the state deal with its budget crisis and try to minimize or eliminate reductions in spending on education.
Speaking to reporters in Oakland, where he announced $394 million in funding for transit projects statewide, Schwarzenegger said that when he announced his proposed budget in January, "I was the first one who said the worst idea is to cut any money from education and we must do everything we can to learn from mistakes that were made in the past."
Schwarzenegger said he proposed cutting at least $4 billion in overall education spending only as part of 10 percent across-the-board cuts to help California deal with a projected $16 billion budget shortfall.
He said one of the problems in out-of-control spending by the state's elected leaders, noting that California is facing a budget crisis even though the state's revenues have increased by nearly $30 billion over the past 10 years, from $68 billion to $96 billion.
Schwarzenegger said, "When we have a surge in revenues, people grab all the money but when revenues are flat there's nothing left and that's why there's an up-and-down roller coaster and everyone has to hold on for life."
He said, "We have to fix the budget system so there are no more cuts in the future."
Asked if he would consider raising taxes, Schwarzenegger said, "Everything is on the table and all types of different ideas are being thrown around."
Schwarzenegger said he will look at all ideas, including a proposal by State Senate President pro-Tem Don Perata, D-Oakland, to look at raising sales taxes temporarily to boost revenues.
Talking to reporters after Schwarzenegger finished his news conference, Perata said, "People hear what they want to hear" when Schwarzenegger talks about the state's budget but today wasn't the first time he's heard the governor talk about considering some type of tax increase.
Perata said, "The governor wants to get it done," in terms of doing whatever it takes, possibly including a tax hike, to solve the state's budget woes.
But he alleged that Republicans in the state Legislature are "entrenched in ideology" and are strongly opposed to tax increases because they think the state has a spending problem instead of a revenue problem.
Perata said, "I don't agree and I don't think we have to make painful cuts" to the state's budget.
Clarifying Perata's position after the news conference, his spokeswoman, Alicia Trost, said a sales tax increase is only "one possible way" to raise more money.
Trost said voters seem to prefer a temporary sales tax hike to other types of tax increases because "it's pennies on the dollar and it's only a little bit at a time."
Trost said Perata hasn't decided how big of a sales tax increase he may seek.
Schwarzenegger said, "Negotiations will start soon, hopefully tomorrow," on how to deal with the state's budget situation, including education funding.
He said he wants to have a decision made by March 15 because that's when school districts across the state will have to decide whether to send layoff notices to teachers to cope with possible funding cuts.
(© CBS Broadcasting Inc. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed. Bay City News contributed to this report.)
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