Morning Splash: State Budget Ramifications; Oakland Still w/o Budget; Higher Fares, Tolls Friday

Poor people will receive less medical care and welfare, disabled people will see fewer services, state parks will close and public university students will pay more in California under the budget that takes effect Friday. But also Friday, the state sales tax will decrease from 8.25 percent to 7.25 percent and vehicle licensing fees will drop by almost half. Combined with the taxes that expired in January, an average California family will pocket about $1,000 this year.

Billions of federal stimulus dollars that boosted Medicaid programs for the past two years will run out Friday, while at the same time California is trying to get approval for a series of cuts to the health program for the poor. It could be a one-two punch for more than 7 million Californians enrolled in Medicaid, known here as Medi-Cal.

Reacting swiftly to an online sales tax signed into law Wednesday by Gov. Jerry Brown, Amazon.com and Overstock.com announced they are severing their relationships with California affiliates to avoid having to collect the tax. Under federal law, states can require online retailers to collect sales taxes only if the seller has a physical presence in the state. California law requires residents to pay taxes on all online purchases, but many consumers don't, giving Amazon and other online retailers that don't collect the sales taxes an advantage over big-box retailers and other brick-and-mortar stores. The new law allows the state's tax board to collect sales tax from online retailers that have relationships with an affiliate -- typically in-state blogs that drive sales to the retailers in exchange for a small cut of the proceeds.

The Oakland City Council will make another attempt to approve a budget at a special meeting Thursday evening, only hours before the new fiscal year begins. The meeting will be a follow-up to a four-hour hearing Tuesday night at which council members discussed three competing budget proposals but ultimately could not agree on a budget.

Teachers win layoff protection while school finance officials see their powers curtailed in the state budget package Gov. Jerry Brown is expected to sign today. The last-minute school legislation, Assembly Bill 114, emerged publicly less than an hour before lawmakers approved it in a late-evening Tuesday session. It reflects the negotiating muscle of teachers as Democratic lawmakers crafted their majority-vote budget with a governor of their own party.

Gasoline prices may have fallen recently but the cost of getting around the Bay Area is going up Friday for many transit riders and drivers. And for hybrid drivers who have cruised solo through the carpool lanes for years, the cost isn't rising, but the hassle is. The state-issued gold stickers that allowed access become worthless Friday. Only drivers with white stickers, issued to all-electric and some compressed natural gas vehicles, will be allowed an exemption to the carpool rules.

The governor has not signed the budget yet, but two bills he did sign Wednesday that would contribute $1.7 billion to the state's coffers are likely to be tied up in court for months. The bills effectively eliminate the state's 398 redevelopment agencies. The California Redevelopment Association and the League of California Cities are preparing to file a lawsuit in the next few weeks challenging the bills that force the agencies to dissolve and join a new program.

As expected, the Berkeley City Council last night adopted the biennial budget for fiscal years 2012 and 2013. The budget, originally presented on May 3, closes a $12.2 million deficit in FY2012 and a $13.3 million deficit in FY2013 by eliminating 79 positions, cutting a number of services, and raising a number of fees (the full 384-page budget report can be accessed here). The budget had been extensively debated in a number of council meetings since the a discussion of the budget development calendar in October. Last night there was no discussion of the main budget, and it passed without comment. The focus of debate last night was on supplemental allocations for community agencies that had been cut in the proposed budget. Councilmember Linda Maio and Mayor Tom Bates proposed $114,078 in additional funding for nine agencies, and councilmember Max Anderson proposed $264,078 in additional funding for the same nine agencies, as well as the city’s Black Infant Health program, a number of festivals and the city’s pools.

The Oakland Police Department is planning to expand its force in East Oakland, the city's highest-crime area, by changing how and where it deploys officers who patrol beats, The Bay Citizen has learned. The move is not only a response to the city's surging homicide rate and to budget cuts that have shrunk the size of the department, but also to pressure from a federal judge to implement long overdue reforms.

The mayor has tapped a retired state fire marshal to review water rescue policies and the ineffective response by public safety crews that led to the death of a 52-year-old man on Crown Beach on Memorial Day. Ruben Grijalva is a former state fire marshal and former director of the California Department of Forestry and Fire Protection under former Gov. Arnold Schwarzenegger. He quit working for the state in 2009 and founded FireChiefs.com, which offers consulting services to public safety agencies nationwide.

San Jose City Councilman Ash Kalra has quietly pleaded guilty to drunken driving and will report Tuesday for the first of five days of court-ordered community service work. Kalra's lawyer, Eric Geffon, entered a guilty plea on his behalf June 9 to driving drunk in downtown San Jose last month. Judge Edward F. Lee then sentenced Kalra to a standard first-offense combination of about $2,000 in fines, three years of probation, 90 days of drunken driving counseling and almost a week's worth of community service work.

Farmworkers continued to demonstrate outside Gov. Jerry Brown's office Wednesday, suggesting he discarded them like squeezed oranges late Tuesday when he vetoed a bill that would have made it easier for farmworkers to unionize. Twelve hours after Brown's veto was announced, the United Farm Workers union said it would push the measure through the Legislature again. The bill would give farmworkers an alternative to a secret ballot, letting them organize instead through signed petition cards.

San Francisco shoppers are in store for some wallet relief when the sales tax drops by 1 percent Friday, but the full discount might be short-lived...But San Francisco voters might be asked on Nov. 1 to enact a local half-percent sales tax on April 1. The half percent raises the sales tax to 9 percent, still cheaper than consumers are paying until July 1. However, the benefit is that San Francisco retains all the money raised by the hike.... Mayor Ed Lee (is) proposing the increase...

Once again, the most hard-fought provision in the proposed San Francisco budget has to do with whether sworn institutional police officers and sheriff's deputies should be providing hospital security - an issue that has reverberated to the mayor's race. Mayor Ed Lee, like his predecessor, has proposed contracting out security services at San Francisco General Hospital and Laguna Honda Hospital. The officers and deputies who work there would be moved to positions at clinics, jails, courts and City Hall. The move could save millions of dollars a year, officials say.

A concrete catacomb that snakes beneath the Marin Headlands will be sealed off out of concern for the safety of people who for decades have been sneaking into the old military bunker to explore and party. On Wednesday, Golden Gate National Recreation officials led a tour of the concrete bunker that rests below Hawk Hill, the highest point in the headlands. The bunker will have all its entry points sealed tight.