- Associated Press - Monday, June 29, 2015

SACRAMENTO, Calif. (AP) - The California Legislature is holding two special sessions this summer to tackle long-vexing funding shortfalls in the state’s transportation and health care programs. But talk of targeted tax increases has prompted political hand-wringing.

At issue in the sessions ordered by Gov. Jerry Brown is how California should pay billions of dollars for needed road and highway repairs as well as funding Medi-Cal, the state’s medical insurance program for the poor. Medi-Cal now provides coverage to one in three Californians.

There’s no set deadline for reaching deals. Lawmakers plan to take up the issues separately.

Brown, a Democrat, had pledged in his 2010 campaign to take tax increases to the ballot but says he didn’t make a similar promise during his re-election campaign.

“We’ll have to leave that as an open question,” he said.

Republicans question that logic.

“The contract didn’t disappear just because he got elected the second time,” said Senate Minority Leader Bob Huff, R-San Dimas.

Voters aren’t likely to revolt against targeted tax increases because the state’s economy has improved and many see roads in poor condition, said Jack Pitney, a political science professor at Claremont McKenna College.

Lawmakers of both parties agree the state’s transportation tax structure is out of date. They can’t keep relying on a gas tax that hasn’t been increased in 20 years and lets thousands of electric car drivers off the hook for maintaining the roads they drive on.

Transportation advocates and lawmakers have proposed a variety of fixes, including hiking fees on gas, vehicle registration and licenses; re-directing money used to pay off state debt back to road projects; and converting carpool lanes into paid toll ways.

Meanwhile, Brown’s administration is studying how to eventually tax drivers for miles traveled instead of gas guzzled.

Jim Earp, a consultant for a coalition of trade unions and construction companies, says the compromise most palatable to voters would be a wide swath of small fee increases.

Such a move requires support from Republicans, though many oppose taxes and some would only allow a narrow tax proposal to be considered by voters.

Instead, Huff and Assembly Minority Leader Kristin Olsen, a Modesto-area Republican, are pushing to redirect billions from existing fees to transportation to avoid raising taxes. The GOP proposals are likely to hit resistance from Brown because ideas call for cutting state government jobs and redirecting money from fees on polluters that the governor wants to use for public transit.

On health care, Brown is proposing a more modest fix.

The governor wants lawmakers to expand a tax now levied on health plans that contract with Medi-Cal to include most insurers regulated by the Department of Managed Health Care.

The administration estimates that could generate at least $1.1 billion a year to help stabilize state funding for Medi-Cal.

Lawmakers also want to find ways to increase funding to support the developmentally disabled. But those proposals are unlikely to address Medi-Cal’s bigger problems.

California’s Medicaid program for the poor has ballooned 50 percent since the federal health care overhaul was fully implemented. Medi-Cal has grown to more than 12 million people, including half of the children in the state.

That growth has also led to widespread complaints about delays in patients being able to see doctors, specialists and dentists.

Doctors and hospitals say the state pays much less than private insurance or Medicare for medical services, which means fewer primary care doctors and specialists are willing to treat Medi-Cal patients.

“I just don’t know if the special session will fix those issues,” said Mark Diel, executive director of California Coverage and Health Initiatives, which advocates for affordable health coverage.


Follow Fenit Nirappil and Judy Lin on Twitter at www.twitter.com/FenitN and www.twitter.com/JudyLinAP

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