The deal comes at a time when California was headed for fiscal calamity, already unable to pay all its bills and on the precipice today of suspending 374 construction projects that were valued at $5.58 billion and could have affected more than 90,000 jobs statewide.
As part of Maldonado's agreement, lawmakers approved measures asking voters to approve constitutional amendments to establish an open primary system and ban legislative pay increases during deficit years. But legislative leaders refused to grant him his proposal to eliminate legislative pay altogether when the budget is late.
Leaders also agreed to Maldonado's demand to eliminate the 12-cent additional gas tax, which was estimated to bring in $2.1 billion through June 2010, and up to a 5 percent surcharge on income tax liability. The money will be replaced with a 0.25 percent increase in the state income tax rate, federal stimulus dollars and more than $600 million in line-item vetoes.
Screwed again. Since I live close to work, I only drive about 6,000 miles per year. At 18 mpg, the 12-cent per gallon tax works out to be ~$40. A 0.25% increase in state income tax is going to cost me a lot more than $40. Even more important than the actual dollars, I don't have any control over income taxes (unless I quit my job). With consumption taxes, at least I have the option to alter my behavior in response to the tax increase, such as drive less or buy a more fuel efficient car.
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