Accord Sought on Works Measure

SACRAMENTO —  Facing a Friday deadline, Gov. Arnold Schwarzenegger and lawmakers are scrambling to compromise on a colossal public works package that they hope will demonstrate renewed bipartisan cooperation.

Schwarzenegger and Democratic leaders are closing in on the parameters of a plan that would involve roughly $20 billion less in borrowing than the $68 billion the governor proposed in January, according to lawmakers and senior aides in the Legislature and the governor’s office. But it would still pay for road expansion and reconstruction throughout the state and fortifying California’s levees.

Negotiators say the governor has agreed to include money for affordable housing and more funds for public transit -- both priorities for urban districts that are the largest Democratic constituencies.

Several potential deal breakers remain unresolved. But “I think we have about an 80% chance of getting something through this week,” said Sen. Tom Torlakson (D-Antioch). “The public is expecting us to act, and we should act.”

One of the governor’s original priorities -- directing $9 billion toward expanding local jails and renovating courthouses -- has been put on a back burner. Also, the negotiations are focusing on a less expansive vision of the building plan than Schwarzenegger first offered. Instead of stretching through five elections to 2014, the bond measures needed to pay for it would be put before voters by 2008 or 2010.

The Democrats, who have a majority in the Legislature, have agreed with Schwarzenegger’s plan for borrowing money to strengthen the state’s levees.

In addition, the Democrats have given up on trying to allot money to retrofit old hospital buildings so they can survive earthquakes -- a concern of one of the party’s political partners, the Service Employees International Union, which represents healthcare workers.

The biggest impediment to a deal may be the GOP minority in the Assembly, which so far has received no major concessions from the Democrats. Those Republicans have been pressing for looser environmental reviews of new construction, more than $1 billion to build reservoirs in agricultural areas, and having some portion of the construction be paid for directly by taxpayers instead of through borrowing.

“We’ve got a long ways to move before we’re ready,” said Assemblyman Rick Keene (R-Chico), the chief negotiator for his caucus. “We’re saying let’s do this right. We’re talking about one of the biggest investments in infrastructure in state history.”

Between the governor and Democrats, the main sticking points appear to be what kinds of restrictions should be included. The Democrats, for instance, demand limits on new developments on floodplains that would receive greater protection through reinforced levees.

Schwarzenegger wants exemptions from environmental reviews of many of these projects. He also is pushing for a strict cap on future borrowing.

Negotiations have been largely fruitless for the last two months, but picked up this week because Secretary of State Bruce McPherson has set Friday as the last day for lawmakers to place the measure -- which requires voter approval -- on the June 6 ballot.

Reaching that deadline is seen in the Capitol as the first test of whether Schwarzenegger and legislators can live up to their promises to work more harmoniously this election year. Negotiators believe they can stretch the deadline to early next week if necessary, but beyond then any deal they reach would have to wait until November.

“Is it doable to put something on the ballot in June? It’s very doable,” said Assembly Speaker Fabian Nunez (D-Los Angeles). “Will it happen? I can’t guarantee that it will.”

Negotiators described the outlines of the deal that is shaping up. The total amount of bonds is likely to be between $42 billion and $55 billion.

Between $14 billion and $20 billion would be for transportation -- more than the $12 billion that Schwarzenegger originally proposed.

There would be roughly $18 billion to $22 billion for school construction. Though that is less than the $38 billion Schwarzenegger had proposed, it’s not too different from the amount of borrowing the governor had envisioned by 2010. Democratic lawmakers said future legislatures could easily put additional bond measures on the ballot if more money was needed.

The plan being negotiated is likely to include between $4.5 billion and $6 billion in state borrowing for levees. That borrowing would happen much more quickly than Schwarzenegger proposed in January.

The governor had hoped the federal government would supplement state spending, but he returned from a trip to Washington last week and told lawmakers they should not count on any additional support from the Republican Congress or the Bush White House.

The affordable-housing component is likely to fall in the range of $1.4 billion to $2 billion. There also would be some amount for urban parks -- a priority of Los Angeles Mayor Antonio Villaraigosa -- though it is unclear how much.

The total spending is sure to be far higher than the amount lawmakers raise through bonds because it will include other financing -- possibly fees and federal and local funds.

Schwarzenegger’s initial plan called for $222 billion in spending, of which $68 billion would have come from state borrowing. It is not clear how much would be spent under the deal now being pursued.

Advocates for projects in peril are already castigating lawmakers.

“Not preparing for an earthquake is as foolish as not preparing for [Hurricane] Katrina in Louisiana,” said Beth Capell, a lobbyist for the Service Employees International Union.

Sen. Sam Aanestad (R-Grass Valley), one of the main proponents for money to build new reservoirs, said Democrats were veering too far away from public safety.

“To put parks and recreation on the same level of importance as flood protection and a safe, reliable water supply is, in my opinion, untenable,” Aanestad told a panel of legislators Wednesday.

Groups whose interests are sure to be included in a final deal pressured lawmakers to finish crafting the package in time for the June ballot. The Los Angeles Area Chamber of Commerce sent 100 local business people to Sacramento to lobby lawmakers Wednesday.

“This is a discussion that should have been had over the last 20 years, and it just hasn’t risen to the top,” said Ron Gastelum, the chamber’s executive vice president. “You just don’t know with the Legislature whether there will be another issue they want to talk about in November.”

Even with the impending deadline, there have been significant distractions. This has been most apparent in the Assembly, where Republicans had a sudden leadership change.

On Wednesday, they elected George Plescia of San Diego as their new leader, to succeed Kevin McCarthy of Bakersfield. McCarthy announced Tuesday that he was running for the congressional seat being vacated by Bill Thomas.