Obama's budget could impact California _ if it survives

WASHINGTON — California has a big stake in the debate begun Monday with release of the Obama administration's proposed fiscal year 2013 budget, even if the sprawling document has only a short lifespan.

If adopted, Obama's budget would mean fewer subsidies for Central Valley farmers, smaller grants for Valley counties and less money for incarcerating the illegal immigrants who crowd the state's jails and prisons.

The budget also subtracts money used to clean California beaches while it invests in preserving Valley lands and aiding some of the state's 2.5 million community college students.

"The budget is balanced, fair and responsible," declared House Minority Leader Nancy Pelosi, D-San Francisco, adding that "it is a fiscally responsible plan."

The $3.8 trillion budget, though, is as much a political statement as it is a spending blueprint. Republicans who control the House call the 1,200-plus page bundle of documents dead on arrival, and even Democrats stress it's only a starting point, at most.

The administration, for instance, proposes a modest $70 million for the State Criminal Alien Assistance Program, down from the current $240 million. This repeats a familiar plot. Presidents of both parties invariably propose cuts in the program that reimburses states for imprisoning illegal immigrants, and lawmakers from both parties always strive to add more.

Roughly 13 percent of California state prison inmates are identified as illegal immigrants; in some county jails, the percentage may be even higher. Overall, California and its counties spend upwards of $1 billion to incarcerate illegal immigrants.

"That leaves a big hole," Matthew Cate, secretary of the California Department of Corrections and Rehabilitation, said of the funding shortfall in a recent interview. "I would love to see the federal government play a bigger role."

All told, the administration identified 210 federal programs for notable cuts or consolidation. Many proposals are retreads that have been rejected before.

Some proposed cuts are also but a drop in the ocean of federal spending. The administration, for instance, wants to end a $10 million Environmental Protection Agency beach grant program that delivered $506,000 to California last year.

Other cuts are part of a bigger picture. The administration, for instance, proposes saving $324 million by stopping production of the Air Force's Global Hawk unmanned reconnaissance vehicle, which has been put together at Northrop Grumman's Palmdale facility and stationed with the 9th Reconnaissance Wing at Beale Air Force Base, 40 miles north of Sacramento.

"The comprehensive strategic review, recently completed by the Department of Defense, reduced the requirement for the number of high altitude reconnaissance (flights)," the Obama administration explained Monday.

Many defense cuts may not fly, though, on Capitol Hill, where lawmakers such as Rep. Howard "Buck" McKeon, R-Palmdale, Calif., the chairman of the House Armed Services Committee, have vowed to sustain military spending.

Just the opposite is the case with high-speed rail, where it's the Republicans who want to cut and the Democrats who want to spend. The Obama administration is requesting $2.5 billion for high-speed rail next year, as part of a larger, five-year transportation plan. House GOP lawmakers have rallied against high-speed rail, prompted in part by skepticism about California's ambitious and embattled program.

Obama also wants a big, multi-billion dollar increase for "Project Rebuild," his latest bid to help cities buy and fix up abandoned and foreclosed properties. If lawmakers go along, it would steer dollars toward the Central Valley, often dubbed "ground zero" for the nation's foreclosure crisis.

Obama's past housing proposals, though, have often been blasted for falling short or going awry, and his new proposal is politically untested. Still other budget proposals run into highly organized interest groups with proven political clout.

The administration, for instance, proposes eliminating direct payments to growers of subsidized crops such as cotton, rice, wheat and corn. Although California is less reliant on subsidies than some Midwestern states, California growers still received $148 million in direct payments in 2010, data compiled by the Environmental Working Group shows.

"Bottom line, this department has stepped up and taken deficit reduction seriously," Agriculture Secretary Tom Vilsack told reporters, adding that "direct payments are going to change."

Congress is scheduled to write a farm bill this year, which lawmakers will use to recast the subsidy system; traditionally, aggressive subsidy reform proposals fail unless they have serious political capital invested in them. Vilsack did not mention the proposed subsidy cut in his 14-paragraph written budget statement.

The administration made a much bigger splash with its so-called Community College to Career Fund, a new $8 billion proposal to help train students for jobs in high-growth industries. In accepted by Congress, a sizable chunk of that money could filter down to California's 110 community colleges.

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