Governor Arnold Schwarzenegger

By Dan Walters
Published: Wednesday, Jan. 20, 2010 – 12:00 am | Page 3A

Five years ago, California’s local government officials were hailing Arnold Schwarzenegger as their fiscal savior for championing a ballot measure to protect their treasuries from raids by the state.

Now they’re denouncing him as a bandit who steals money they need for providing police, fire and other local services because he exercised a loophole in that ballot measure.

“On this point, let me be very clear,” says Long Beach Mayor Bob Foster, “the most immediate threat to the financial stability of this city is raids on our general fund by Sacramento.”

It’s a dramatic turnaround in relationships that needs some historic context to understand.

In the early 1990s, when the state was experiencing budget problems that were, proportionately, worse than today’s, the Capitol cooked up a scheme to redirect local government property taxes to schools, thereby allowing the state to reduce its own payments to schools by billions of dollars.

Local officials fumed and vowed to stop it from happening again, but it took a decade to resolve internal differences and build a political coalition for a ballot measure to protect local coffers from Sacramento’s raids. And as they qualified a measure for the 2004 ballot, Schwarzenegger, a newly minted and very popular governor, interceded.

If the locals would allow the state to make a final raid, he told them, he’d help them pass a revised ballot measure that would shield their treasuries – although it would allow the state to borrow money from local governments once a decade. The locals agreed, happy to have Schwarzenegger on their side, and hailed him as their hero when voters approved Proposition 1A in 2004.

Dwight Stenbakken, deputy executive director of the League of California Cities, declared at the time that Proposition 1A “provides the protection, but it also accommodates the current state budget crisis.”

To read entire column, click here.