June 20, 2011, 4:29 pm • Posted by John Myers
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The historic veto of the state budget by Governor Jerry Brown may have set the stage for some drama in these final few days before the new fiscal year.

But even though the governor insists that his tax package is still the way to go, a case could be made that Brown and his fellow Democrats might be able to agree on solutions that would cut the projected $10 billion deficit in half.

It doesn't sound as though there's been a rush to close ranks on the Democratic side. Brown didn't meet with the leader of either legislative house today, and Senate President pro Tem Darrell Steinberg continued to say it's up to the Guv to lay out what's next.

"The next move is his," Steinberg told reporters today. "I'd love nothing more than to come back and vote on his [original] plan with the requisite votes."

Translation: Guv, let us know when you find those Republican votes in each house for your proposal.

But even as things seem at a standstill, it's worth stepping back and acknowledging that the real disagreement between Jerry Brown and his fellow Dems could be as small as $5 billion or less, out of a budget problem that -- lest we forget -- was pegged in January at $26 billion.

Start with the roughly $10 billion problem identified by the budget sent to Brown's desk last week (and set aside the issue of a reserve, which for years was too often lumped in to the actual red ink lawmakers need to clean up).

Democratic legislators reinstated Brown's January budget proposal of deferring about $3 billion of funding for K-12 schools and community colleges. The governor canceled that plan of action in his May revision, saying the better-than-expected state revenues allowed more breathing room. But given the Guv himself once proposed this kind of action, might it not be revisited if a Democrats-only budget is still where things are headed?

Next, remember that Democrats scored another $800 million of revenue, on top of the $6.6 billion windfall Brown projected in May. While only about half of that is cash that's already shown up, projecting an equal amount between July 1 and June 30, 2012 wouldn't seem to be too much of a stretch for the Guv.
Photo by Getty/Justin Sullivan
 
After that, legislative Democrats could prevail upon Brown to forego the repayment of debt featured in his May revision, his attempt to chip off a few pieces of what he's called the state's "wall of debt." That repayment (Brown wanted to pay back internal borrowing, Dems wanted to repay K-12 debt) was to the tune of $744 million. But perhaps everyone agrees to say, 'Nice idea, but can't do it just yet.'

If so, erase another chunk of the deficit in dispute.

Next, let's say everyone on the Democratic side holds their nose (or closes their eyes and grimaces, whatever image works for you) while they make additional cuts already proposed by either the governor or Democratic majority... but not, for now, agreed to by both. That could include additional cuts offered by Brown cuts in child care and welfare assistance and the Legislature's additional cuts of $300 million in higher education and $150 million in trial court funding. Add all of that up and it might total close to $600 million in cuts that no one would likely be able to call gimmicks.

Subtotal at this point of deficit erased: $5.1 billion, or about half of the problem left to solve... all by largely accepting items that were begrudgingly proposed or accepted earlier this year.

After that, things get admittedly more dicey. One could assume, perhaps, that Brown would go along with the $200 million in projected revenues from forcing online retailers to collect sales tax. The governor actually expressed some interest in that part of the legislative budget package just hours after his veto.

Or, perhaps more controversially, he could take a look at the proposed $12 vehicle registration fee to help fund the DMV, scored at $300 million by legislative Dems. Some have suggested that the fee, while no doubt onerous to many drivers, would nonetheless build on the already existing idea of fees-used-for-special-funds-services.

That would get Brown and his fellow Democrats down to about $4.4 billion of projected deficit. And that's admittedly still a lot of tough choices, especially given the governor's "no gimmicks" pledge and the legislative
Democrats's equally forceful "anti-all cuts" stance.

Still, the exercise is useful in showing that Democrats still have several tools at their disposal, ones that don't need GOP support to carry out.