Chamber Alliance Bemoans Budget Deal

Brendan Huffman, Chambers of Commerce Alliance of Ventura and Santa Barbara Counties

Although the California Legislature is patting itself on the
back for the rare passage of a new spending plan before the new fiscal year
began on July 1, the celebrations could be short lived.

While the Chamber Alliance applauds the progress made
towards resolving an enormous budget deficit, at the same time, we are
disappointed that lawmakers failed to address many of the fiscal challenges
that have festered for years and will impact Californians for generations to
come without tough decisions being made now.

For example, lawmakers failed to address unfunded pension
liabilities and an outdated tax system that was crafted many decades ago when
California’s economy was much different. Lawmakers also opted not to address complicated
revenue formulas that deprive municipalities of tax revenues generated in their
own communities.

Another budget item of contention from the Alliance is the
elimination of all of California’s 400 redevelopment agencies. The legislation,
 AB X1 26 and AB X1 27, gives redevelopment agencies the option of
giving the state their money or face elimination. Some deal!

Finally,
there is the matter of the “anticipated” revenue of $4 billion through the
remainder of 2011 to make up the last part of the budget deficit. Instead of
cutting $4 billion (or extending some of the 2009 tax increases), legislators
decided to hope that the economy will improve enough to add $4 billion to the
state’s coffers. So far, the latest job figures don’t look promising.

As for
Republican lawmakers, they are taking credit for holding firm on opposing all
tax hike proposals and letting the 2009 tax extensions expire. In the process,
they missed opportunities to advance legislation of which the state’s business
community has been vocal about for years, such as spending caps, regulatory
relief, pension reform and changes to California’s daily overtime rules.

Looking
ahead, it appears that more budget cuts will have to be made if the $4 billion
doesn’t materialize, and several business groups are considering efforts to
qualify job creating initiatives for the 2012 ballot.

For more information
about the Chambers of Commerce Alliance of Ventura & Santa Barbara Counties
and our advocacy efforts, please visit www.ChamberAlliance.biz.