Governor to Consider Tax Rebates if Revenues Climb : Cites Ceiling Voted for in ‘Spirit of 13’

SACRAMENTO — Gov. George Deukmejian said today that he will consider giving tax rebates to Californians if state revenues climb beyond the state spending ceiling approved by voters in a 1979 initiative.

“I have not considered a tax rebate up to this point,” Deukmejian told Capitol reporters at his first major news conference of 1986.

“However, we are approaching the limit imposed by Proposition 4 in terms of the amount of growth people have authorized,” he said. “If we get close to that limit, and indeed there are some unanticipated revenues, then we would have to consider returning the revenues, because that’s what the law provides.”

The 1979 initiative, dubbed the “Spirit of 13,” was sponsored by Paul Gann, co-author of the 1978 Proposition 13 property tax cut. It set limits on how much the state can spend each year, allowing the total to increase according to population and inflation and requiring excess funds to be returned to taxpayers.

Ceiling Never Reached

Because inflation has been high since 1979 and the population has grown, the budget has never reached the ceiling. The current year budget is $876 million below the limit.

But since inflation has dropped, Deukmejian’s proposed budget is within $100 million of the ceiling for 1986-87, an amount that could easily be wiped out with some Medi-Cal or prison caseload increases.

Deukmejian’s spending plan is a 2.4% increase over the $35.8-billion budget for this 1985-86 year. However, when it was proposed a year ago, Deukmejian’s budget for this year was $33.6 billion.

Deukmejian also repeated his recent criticism of Los Angeles Mayor Tom Bradley, the governor’s likely opponent in his reelection campaign for governor, saying Bradley had switched his positions on key issues “simply to get elected,” including gun control and environmental issues.

“He’s changing his tune,” Deukmejian said. “People are going to wonder once he gets elected, does he change back to his prior position?”

May Cost $8 Million

Deukmejian said his reelection effort may cost $8 million.

On a related subject, the governor said he doesn’t consider himself a potential Republican candidate for vice president in 1988 because he would lack the national exposure needed for the job. Deukmejian said he has no political plans beyond seeking reelection to a four-year term in November and added that he anticipates that both political parties will want to nominate women for the vice presidency in two years.