HEALTH ACCESS UPDATE

Wednesday, August 7th, 2002

BUDGET DEBATE HEATS UP

Additional Cuts Debated and Rejected; Increased Tobacco Tax In Play

ATTACHED:

* Memo by Senate Secretary on Budget Timing

* Alert by Speaker Wesson on Tobacco Tax

THE STORY SO FAR: The Senate came back into session after a month-long recess this past Monday, August 5th, but it was the Assembly that restarted serious debate and discussion on the budget. The Senate went into recess in late June after passing their budget plan, which raised the tobacco tax and restored part of the vehicle license fee, and thus was able to prevent the worst of the proposed cuts to health care and other services. The Assembly stayed in session throughout July, but was unable to get the 2/3 majority needed to pass the Senate budget. No Assembly Republicans voted for the budget, due to their opposition to increased revenues.

CUTS PRESENTED AND REJECTED: On Monday, Assembly Democratic leaders called the bluff of those not voting for the budget. The Assembly debated and voted on a plan that did not increase revenues, and thus made the additional cuts necessary to balance the budget. The presented cuts were steep in every area, including cuts of $1.5 billion cut to public schools and community colleges, $1.16 billion in health care, more than $422 million to social services, $240.6 million to universities, $215.8 million to environmental protection, and $164.6 million to public safety. In health care, the cuts included not only all of the Governor’s proposed cuts from the May Revise, but additional cuts that Assembly Republicans have proposed in recent months, such as the elimination of the Child Health and Disability Prevention program. Yet the Assembly Republicans voted with the Democrats against these cuts, and the proposal got zero votes.

NEW PROPOSAL ON TOBACCO TAX: On Tuesday, the debate moved onto an alternative approach to raise revenues. Since the Assembly Republicans have refused to vote for a partially-restored vehicle license fee, or even a plan that included cuts that they had previously proposed, Assembly Speaker Herb Wesson put forward a third approach. SB 1849 would, in lieu of the vehicle license fee restoration, increase the tobacco tax by $2.13, to a total in taxes of $3.00 a pack. On Wednesday afternoon, this new budget plan was voted on, 49-20, failing to get the 54 needed votes. ATTACHED is a flyer from the Speaker’s Office with talking points, urging people to support SB 1849. Assembly leadership believes that this is the proposal that could eventually win the votes needed to pass a budget.

OTHER ALTERNATIVES: To present yet another alternative to devastating cuts, Assemblywoman Helen Thomson will host a press conference on Thursday morning at 9:00am in the Governor’s Press Room 1190 in the Capitol. She will release an open letter signed by over 85 high-income earners who support restoring the upper tax brackets in order to prevent severe cuts, and will be joined by some of the signatories.

Health Access continues to be against cuts that would devastate our health care system, and is in active support for increased revenues that serve prevent such cuts. Our coalition supports a range of solutions, that includes tobacco taxes, vehicle license fee restoration, upper tax bracket restoration, and/or a combination thereof, to prevent cuts not only this year, but in future years when budget deficits loom.

TIMELINE: How long can this budget crisis go on? ATTACHED is a memo by the Secretary of the Senate, which summarizes: “Bottom line: a budget bill may be taken up and passed any time after August 31 but no later than November 15 without any need for a special session. Urgency bills may be taken up. Tax levies may be taken up.” With the budget now late by over a month, Health Access urges passage of a budget well before November 15th.

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HERB J. WESSON, JR.

SPEAKER OF THE CALIFORNIA STATE ASSEMBLY

ALERT: TOBACCO TAX VOTE IN STATE ASSEMBLY

Support SB 1849

·Assembly Speaker Herb J. Wesson has proposed a new tax on cigarettes to help cover the state budget shortfall.

·Instead of increasing the car tax (The Vehicle License Fee) his plan will increase the cost of cigarettes by $2.13—to a total in taxes of $3 a pack.

·The new cigarette tax will help prevent the draconian cuts in health programs proposed in the Governor’s budget and the Republicans’.

·All studies show that with every increase in tobacco taxes-people quit smoking and fewer people start.

·One out of every 10 eighth graders smoke—one of every four high school kids smoke—we’ve got to help them stop.

·No one can now deny that smoking kills. This new tax is the only tax that will save lives.

·And this is the only tax that is voluntary—if you don’t smoke, you won’t pay.

·Call your State Legislator today. Tell them to Support SB 1849. Tell them this is a fair tax, it will save important government services and IT WILL SAVE LIVES.

Tell Your Legislator to Support the Only Tax that SAVES LIVES

SB 1849

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Date: August 9, 2002

TO: All Senate Offices

FROM: Greg Schmidt, Secretary Of The Senate

RE: End of Session

_____________________________________________________________

In these perilous times, a number of people have made inquiries regarding the end of the session and what may or may not be done after the August 31 adjournment date. The following is provided for your edification.

The actual day the 2001-02 Session ends is November 30, 2002. That is the date of adjournment sine die. The August 31 date is set by Joint Rule 51(b) (3) as the beginning of the Final Recess.

The August 31 date is set to accommodate the provisions of the Constitution which give the Governor one month to sign bills and the public 90 days to review them, for purposes of potential referendum, prior to their January 1, 2003, effective date. All regular bills, therefore, must be passed by August 31. Urgency bills, statutes calling elections, tax levies, or “appropriations for the usual current expenses of the state,” can be taken up and passed after the August 31 deadline because they go into effect immediately and are not subject to referendum. However, they must be sent to the Governor by November 15, providing twelve days for him to sign or veto and three days for the Legislature to consider an override.

Bottom line: a budget bill may be taken up and passed any time after August 31 but no later than November 15 without any need for a special session. Urgency bills may be taken up. Tax levies may be taken up.

And if, after all this, everyone decides that enough is enough, special elections may be called as necessary.

Any questions, please feel free to call.

Health Access California promotes quality, affordable health care for all Californians.

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