California eases the impact with a $5 billion relief fund
While Howard Jarvis strutted around Washington and U.S. mayors fretted in Atlanta about how his tax-cutting crusade might hurt them, California struggled with a more immediate problem. On July 1, the end of this week, Jarvis' triumphantly successful Proposition 13 goes into effect, with its more than $7 billion slash in revenues from property taxes. As a select committee of six of the state legislature's most powerful members worked feverishly on a rescue plan, thousands of lobbyists flocked to Sacramento to apply pressure.
A brigade of disabled workers and people handicapped from birth parked their wheelchairs outside the hearing room in the Sacramento capitol in a quiet plea that their welfare aid not be reduced. Leaders of powerful police and fire fighters' lobbies jammed the committee chamber. So did the state's influential teacher and school lobbyists. Committee Member Leo McCarthy, speaker of the state assembly, passed up so many meals as the deadline neared that he had a severe allergic reaction to energy-sustaining almonds and had to be temporarily hospitalized. Select Committee Chairman Al Rodda, a mild-mannered former college economics instructor (his doctoral dissertation was The Economic Mind in 18th Century Colonial America), spent 18-hour days grappling with the economic minds of angry 20th century Californians. Also breathing heavily on the legislators was Governor Jerry Brown, whose own plans for dealing with the crisis—and perhaps his political career—were at stake.
The committee finally tied together a package of first-year emergency aid that will considerably soften the impact of Proposition 13. The solution was swiftly approved by the full legislature and signed into law by a pleased Brown, whose own relief plan had been only slightly modified. In a televised address to Californians, he declared: "Proposition 13 creates challenges, it creates problems, but it creates an opportunity to make government in California a model for people all over the country."
The stopgap solution was to parcel out $5 billion of an estimated $5.8 billion surplus in state revenues to more than 6,000 local government units. The schools will get the biggest chunk of the fund, $2.2 billion. That will mean only a 10.5% overall cut in their operating cash from current levels. The relief money will be applied on a sliding scale so districts that have long had less money for schools will get the most. This will help meet a California Supreme Court decision that support of schools should be equalized.
Police and fire-fighting forces fared even better. The legislature directed that a $250 million slice of the relief fund for cities be used to prevent any cut at all in police and fire department budgets. The result may be, however, that towns and cities will have to cut even more deeply than feared into services like parks and recreation, libraries, public transportation, street cleaning and garbage collection. Local officials may even have to pinch themselves where it hurts most: cutting administrative staffs and such perks as travel allowances and official cars.