By Kevin Yamamura
kyamamura@sacbee.com
Published: Saturday, Dec. 25, 2010 – 12:00 am | Page 3A

Gov. Arnold Schwarzenegger issued grim budgets the last two years, but in many ways he had it easier than the challenge facing Gov.-elect Jerry Brown in 2011.

In proposing ways to close the budget gap, Schwarzenegger relied on ideas few expected to come to pass, like eliminating CalWORKs and getting $7 billion from the federal government.

But Brown has already assailed budget gimmicks, such as counting on billions in federal aid that will never arrive. Proposing wholesale elimination of safety-net programs might be even harder for a Democratic governor.

Given the constraints, here’s a look at what Brown might consider in the realm of cuts, taxes and gimmicks in the budget he proposes on Jan. 10:

Cuts

Schwarzenegger sought to eliminate welfare-to-work and child care. Brown probably won’t do the same, but he will have to find other ways to cut.

To get a sense of where Brown might go, look at ideas suggested by the nonpartisan Legislative Analyst’s Office. In response to Schwarzenegger’s short-lived December budget plan, the LAO offered kinder, gentler (and some would say, smarter) ways to reduce programs.

Rather than eliminating state-subsidized child care, the analyst recommended stricter eligibility requirements and redirecting services to the neediest families.

Rather than eliminating Medi-Cal support for hearing aids, for example, the analyst suggested the state limit such benefits to once every three or four years.

Rather than place a hard cap on the number of doctor visits, the state could impose a soft cap with exemptions for certain medical conditions.

It is unlikely that any area will go unscathed. Schwarzenegger last year protected the UC and CSU systems. But don’t expect them to get special budget treatment for a second year in a row.

Finally, Brown could always propose cuts that get the attention of middle-class voters, such as allowing districts to shorten the school year even further or releasing thousands of prisoners early. Doing so would help lay the groundwork for talking to voters about taxes.

Taxes

The cleanest approach for Brown would be an extension of 2010 rates on income, sales and vehicles. He could make the argument that this would be an extension rather than an increase, though it would lead to higher taxes than Californians would have to pay absent any changes. That would raise more than $8 billion for the state general fund.

Brown is also considering ways to send tax revenue to local governments. Doing so would avoid a potential conundrum the state would face in having to send at least 50 cents of every new tax dollar to schools rather than toward bridging the deficit.

Brown handcuffed himself during the 2010 gubernatorial campaign by committing to a public vote on any additional taxes. Even if Brown could find support from legislative Republicans, he must get the blessing of the people.

Gimmicks

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