SAN FRANCISCO (Reuters) - A prominent Washington activist is calling on Republican lawmakers in California to stick to an anti-tax pledge, a risk to a special election for raising revenue that Governor Jerry Brown is widely expected to ask the legislature to support.
The pressure came in the form of a letter sent on Thursday by Grover Norquist, head of Americans for Tax Reform, a heavyweight conservative advocacy group. In it he told Republicans that “Voting to send tax increases to the ballot would violate the Taxpayer Protection Pledge, a written commitment that you made to your constituents to ‘oppose any and all efforts to raise taxes’.”
“I urge you to stand up for California taxpayers by opposing Governor Brown’s efforts to refer higher taxes to the ballot, and in doing so, uphold your central campaign commitment to oppose any and all efforts to raise taxes in the already over-taxed Golden State,” Norquist added.
Patrick Gleason, state affairs director at Americans for Tax Reform, said the letter marks the start of a broader campaign against efforts to raise taxes in California.
“This is the opening salvo,” Gleason said.
Brown, a Democrat, would need votes from Republicans in the legislature’s minority to be able to put a tax measure to a statewide vote. Brown spokesman Even Westrup declined to comment on Norquist’s letter, noting the governor’s initial budget plan is tentatively slated to be released on Monday.
“It’s premature to get into those issues,” Westrup said.
Brown, sworn in this week, faces a state budget gap as big as $28 billion through mid-2012. Now in his third term after two terms in the 1970s and 1980s, he has signaled spending cuts in his plan to balance the state’s books.
The 72-year-old governor has also suggested he may ask the Democrat-led legislature to support a special election in coming months to put the question of tax increases to voters.
Brown has not discussed details of a potential ballot measure. Analysts expect the governor to propose extending temporary tax increases expiring this year. That could raise about $10 billion so Brown and lawmakers would face fewer difficult choices about spending cuts.
RESTORE VOTERS’ CONFIDENCE
Democratic lawmakers would back tax increases after agreeing to deep cuts under former Republican Governor Arnold Schwarzenegger to close massive budget gaps opened by slumping revenue.
By contrast, Republicans have long held the fiscal problems of the most populous U.S. state’s government are rooted in its spending. GOP lawmakers who have voted for tax increases in recent years have found themselves shunned or pushed aside by fellow Republicans in the state’s Assembly members and Senate.
Bob Dutton, the state Senate Republican minority leader, told Reuters he had not yet seen Norquist’s letter, adding that “I don’t respond well to threats.”
“I think for the most part he’s on auto-pilot,” Dutton said, noting Republicans already have against strong arguments against a special election.
First, voters last year rejected a tax measure and, second, they are not convinced state officials can manage existing state funds wisely, Dutton said: “If you’re going to go to the people with anything, you’d better restore their confidence ... They don’t trust us.”
The finances of California’s government have fallen on hard times in recent years because of the housing slump, recession, imploding financial markets and sharp pull-back in consumer spending. The state jobless rate is over 12 percent and economists see it stuck in double-digits for a few more years.
Schwarzenegger and lawmakers in October agreed to a state general fund of $86.6 billion, down more than 15 percent from three years ago. That spending plan failed to hold and within weeks sprouted a $6 billion shortfall.
Brown must close that gap and an expected $25 billion deficit for the fiscal year beginning in July. Tax moves in Washington could add another $3 billion to next year’s gap.
California’s ongoing fiscal troubles are weighing on its already low credit rating. The state is the biggest issuer of U.S. municipal debt and shares with Illinois Moody’s Investor Service’s lowest state general obligation credit rating of A1.
Editing by James Dalgleish