2003 Cal-bred News

Bob Fox’s Legislative Analysis

SACRAMENTO, Calif. (May 15, 2003) -- On Wednesday, the Governor released his revised budget, based on the new revenue projections from the "May revise."

It includes significant tax increases, including a "temporary" increase in the sales tax of .5% that would last only until the deficit is eliminated. Realistically, that could go on for many years.

In addition the budget proposes an increase in the cigarette tax of 23 cents, a tripling of the Vehicle License fee, which would raise $4.6 billion, and a new higher income tax rate for individuals earning over $150,000.

The Governor also proposes to borrow $10.7 billion to help erase the $38-billion deficit and would spread deficit payments over at least five years.

The budget was immediately criticized by the Republicans because of the proposed tax increases and by some Democrats who opposed the proposed spending cuts. It now will be debated in both the Senate and Assembly and it is very unlikely that it will be passed by the deadline.

On the legislative front, AB 923, by Assemblyman Marco Firebaugh which would repeal the sales tax exemption for agriculture, which was approved in 2001, is currently on Third Reading on the Assembly floor. The bill is strongly opposed by the entire agricultural industry, including the CTBA.

The author has not brought the bill up for vote because it appears that it doesn't have the necessary votes to pass. All of the Republicans are opposed and at least seven Democrats representing strong agricultural areas have expressed concerns with the bill.

CTBA members should contact their Assembly member immediately expressing their opposition to this bill, which would have a dramatic effect on the thoroughbred industry. One of the provisions in current law that would be eliminated by AB 923, is the tax exemption on the purchase of race horse breeding stock.

Legislators who should be contacted include Assembly members Nicole Parra, Barbara Matthews, Joe Canciamilla, John Dutra, Dario Frommer, Sally Lieber, Sarah Reyes, and Lois Wolk. These are the Democrats that we believe are concerned with the bill and could be convinced to vote no. The Assembly home page has the Email addresses and districts for these and all other Assembly members.