Dems Work Toward a Two-House Spending Plan - June 24, 2010

Although the end of the fiscal year will be quickly upon us next week, the Conference Committee reconciling the differences between the spending plans crafted by each house remained generally quiet this week, as discussions among Democratic legislative leadership sought to reconcile differences between plans crafted by the majority party in each house.

The Assembly Democrats plan, creative and questionably legal, borrows significant out-year revenues from an oil severance tax to avoid significant cuts. The Senate Democrats plan meanwhile continues temporary taxes and increases others, although in a manner that doesn't deliver enough revenue to avoid difficult cuts. This has caused tensions between the two houses, as Senate leaders have privately blasted Assembly leaders for raising "false hopes" among Democratic constituencies that cuts can be avoided.

The talks now appear strictly between the majority party leaders and don't appear to include the governor or any Republicans, whose votes will be needed to adopt a final spending plan.

Meanwhile, the Conference Committee is scheduled to meet this afternoon, during which the LAO will present its analysis on the Senate's state-local realignment plan.

Sincerely,
Scott Lay
President and Chief Executive Officer