Lottery

Lots of afternoon news in California.

NEW BUDGET COMPROMISE, VETO AVERTED: Legislative leaders have reached an agreement with Gov. Schwarzenegger on modifications to the budget compromise. The governor won't veto as a result. Apparently, there are stronger protections to prevent untimely raids on the rainy day fund and some differences in the gimmicks used to pretend the budget is balanced. More details to come.

RECALL GOING FORWARD, IT APPEARS: Mike JImenez, the president of the prison guards' union, won re-election during a vote at the group's convention in Las Vegas today. The union also voted, by acclimation, to go forward with the recall of Schwarzenegger, albeit with a few caveats.

WHEN DO WE VOTE ON NEW MEASURES? The budget compromise looks like it will include changes that have to go before voters (among them borrowing against lottery revenues and provisions of the state rainy day fund). But it's too late to add measures to this November's ballot. Can such measures really wait until the next scheduled statewide election in the spring of 2010. This budget deal would seem to clinch a special election in 2009.

Yvonne Walker, president of Service Employees International Union Local 1000, which represents state workers, writes in the Sacramento Bee that her union has changed its mind about Gov. Schwarzenegger's plans to modernize the lottery and borrow against future revenues. Once opponents, she says the union now supports the plan. And she's right. Borrowing against the lottery revenue is not a good thing. But, in the absence of the kind of top-to-bottom tax and budget reform California needs, such borrowing may be the least bad option, as I argued recently in the Los Angeles Times. The lottery, by the way, was established in California by ballot initiative.

While you were at the beach or barbecuing hot dogs, petition circulators were practicing democracy. The final sigs are pouring in. Four measures were filed at the last minute in Oregon: a measure to devote a percentage of lottery proceeds to crime fighting, a cap on attorney's fees, a measure to reduce the number of lawsuits, and the open primary "top two" measure.

In Arizona and Nebraska, Ward Connerly's local supporters have filed the signatures on their anti-affirmative action initiatives. The Nebraska initiative is the only measure that appears to have the signatures in that state. (Hat tip, Ballotpedia).

Here's my piece from today's Los Angeles Times on the idea of borrowing against future lottery revenues. (Gov. Schwarzenegger and the Assembly both have proposed doing it).

Former speaker Fabian Nunez, a Democrat, shows up on today's Sacramento Bee editorial page to make the argument for Schwarzenegger's plan to borrow/securitize lottery revenues in order to reduce the deficit and fund a new rainy day fund. the lottery plan would require voter approval. Nunez continues to oppose the spending limitations in the governor's budget reform proposal. 

The former speaker's take may explain the governor's recent behavior. He seems detached from the budget, leaving any talks to legislative players. He has sounded very confident publicly that lawmakers ultimately will have to adopt something like his plan. He speaks as a man who has looked at all the other options, and found none.

It looks more and more likely that California voters will have to bless whatever budget and revenue plans that Gov. Arnold Schwarzenegger and the state legislature agree upon to deal with the state's rapidly escalating budget crisis. Schwarzenegger and legislative leaders are pursuing a privatization of the lottery in order to produce more revenues, but changes to the lottery, which was established by ballot initiative, would likely require voter approval.