[BATN] Schwarzenegger's $222 billion re-election plan Date: 07 Jan 2006 18:47:14 -0800 X-Fingerprint: sentto-2486642-28172-1136688964-news=energy-net.org@returns.groups.yahoo.com-127.127 Published Friday, January 6, 2006, by the Associated Press Governor's $222 billion plan Noting thrashing by voters, Schwarzenegger urges Road, School Projects By Tom Chorneau Proposing an ambitious plan to build and improve schools, roads and levees, Gov. Arnold Schwarzenegger on Thursday called for a $222 billion program that would require the largest bond package in state history. The governor's conciliatory, 23-minute State of the State speech contrasted sharply with the combative tone he struck a year ago. Instead, he addressed issues basic to the lives of most Californians, including more funding for schools, rebuilding freeways and transit systems, improving air quality and raising the minimum wage. He asked Californians to move beyond a year filled with acrimony over his failed special election and devoid of significant political accomplishment. "I have absorbed my defeat, and I've learned my lesson. And the people, who always have the last word, sent a clear message -- cut the warfare, cool the rhetoric, find common ground and fix the problems together," Schwarzenegger told a joint meeting of the Assembly and Senate. "To my fellow Californians, I say, 'Message received.'" The speech was Schwarzenegger's third State of the State address, but it was widely viewed as among the most pivotal of his political career. Facing re-election in November, his task was to persuade Californians to set aside any lingering bitterness over last year's election and to regain the bipartisan image that made him so popular initially. The governor proposed spending $222.6 billion for public works improvements over 20 years, to be paid in part by $68 billion in new bonds. His plan would need to be approved by the Legislature and then go before voters in a series of elections through 2014. Schwarzenegger said his plan is necessary to keep pace with California's growing population, expected to hit 46 million by 2025. The state has not embarked on such a massive series of public works projects since the 1960s, and the governor said it faces an estimated $500 billion in infrastructure needs over the next 20 years. "Our systems are at the breaking point now," he said. "But we cannot be overwhelmed by this reality. We cannot freeze in the face of this future. We cannot bury our head in the sand and say, 'If we don't build it, they won't come.'" The governor's office issued a report outlining proposed expenditures and ways to pay them off, including general obligation bonds, toll lanes, existing funds and fees on water users, both residential and commercial. The bond package could be paid back largely without raising taxes, said Mike Genest, the state's finance director. But some Republicans hesitated to support such a massive new spending program. Assemblyman Ray Haynes, R-Murrieta, said the state already has enough money to handle the projects. The governor pledged that his plan would be fiscally sound and would not overburden a state that grappled with multibillion-dollar budget deficits before he took office in 2003. One aspect of his "Strategic Growth Plan" would constitutionally cap debt payments, limiting them to no more than 6 percent of the state's general fund revenue. The speech sharply contrasted last year's State of the State. At that time, Schwarzenegger threatened a special election if lawmakers didn't meet his demands on a variety of budget and government overhauls. The speech was his first statewide address since voters rejected all four of his ballot measures Nov. 8. He acknowledged the defeat, showing flashes of his trademark humor. "And what a difference a year makes. A year ago, USC and I were No. 1. What happened?" he said, in a reference to the University of Southern California's loss Wednesday in the college football title game. He acknowledged turning a deaf ear to most voters, who told pollsters they didn't want a special election but said he begins the new year "happy and hopeful and wiser." "I hope the members of the Legislature also got the message that people want us to work together," he said. "I have always felt that the people are my partners." His proposed budget for the 2006-07 fiscal year is expected to include about $4 billion more for schools and a freeze in university fees. A predicted $5.2 billion in extra, unanticipated tax revenue next fiscal year gives the governor a welcome boost. He also has proposed a $1-an-hour raise over two years in the state's minimum wage. Democratic legislative leaders welcomed Schwarzenegger's call for cooperation, saying they were willing to work with him. "It's a big step in the right direction. We are still living off the investments Pat Brown made in the 1950s," said former Democratic Gov. Gray Davis, who attended the speech. "The governor lost a year of his term in this disastrous battle with teachers, firefighters and nurses. He has to get back to bipartisan causes like building the state's infrastructure. It's the right thing to do. And it's good politics." Email article texts/URLs for posting to . Manage your subscription by sending a blank email message to: BATN-subscribe@yahoogroups.com to subscribe, BATN-unsubscribe@yahoogroups.com to unsubscribe, BATN-digest@yahoogroups.com to switch email to digest mode, BATN-normal@yahoogroups.com to switch email to normal mode, BATN-nomail@yahoogroups.com to switch email delivery off. See http://groups.yahoo.com/group/BATN for web access & archives.