Mayors Join Debate Over Budget

Schwarzenegger summoned 10 mayors and about as many county supervisors to his office at the Capitol to see if they could resolve one of the remaining sticking points blocking passage of a state budget: financing for local government.

The question comes down to how much protection cities should get from future budget cuts if they consent to major cuts this year and next. Cities want solid assurances they will be spared, while the Legislature's Democratic majority wants the freedom to tap local money if necessary.

After an edgy Fourth of July weekend, when the governor suggested that misbehaving lawmakers needed a "timeout" because they left the Capitol without voting on his proposal, all sides in the budget debate struck a more conciliatory tone Tuesday and voiced optimism that a compromise might be near.

Assembly Speaker Fabian Nunez (D-Los Angeles) said he would work through the night in hopes of forging an agreement. And the mayors designated two of their own -- Los Angeles Mayor James K. Hahn, a Democrat, and Fresno Mayor Alan Autry, a Republican -- to stay at the Capitol and press for a deal that deters the state from seizing local revenue.

"We're going to work very hard to craft a compromise that we can all feel good about," said Nunez, who attended the meeting with the mayors. "Local government wants to work out a compromise, so I think we're in a very good place right now."

One week into the new fiscal year, Schwarzenegger is increasingly eager to pass a budget -- and the people considered crucial to ending the stalemate are the mayors and county officials who assembled in his office. Their importance stems from a side deal the governor made in May.

Local officials had agreed to $2.6 billion in cuts over two years in return for a promise that local revenue would be protected down the road.

"We want an end to Sacramento's ability to steal money from local governments. And any compromise has to recognize that fact," Hahn said in an interview Tuesday.

Democratic lawmakers balked at that plan, crafting an alternative that would make it easier for the state to dip into local revenue in times of financial crisis. Late last week, Schwarzenegger appeared to shift his support to that proposal -- portraying it as a compromise that was essential to passing a budget.