Group to challenge governor's budget fix

January 5, 2009 7:26:26 PM PST
Critics say Gov. Schwarzenegger's proposed budget balancing tax hikes will only hurt the state's economy.

On day 61 of the projected $40 billion budget crisis, the powerful Howard Jarvis Taxpayers Association warned that budget cuts are the only enduring solution.

"It really has to come exclusively on the expenditure side because, again, California remains a high-tax state, and any tax increases at this point in time sends precisely the wrong message," association spokesperson Jon Coupal said.

But Schwarzenegger and his Democratic allies say the tax hikes are actually fees and can be legally approved by a simple legislative majority, not the two-thirds needed for tax hikes.

The Jarvis Association is expected to file a lawsuit challenging that claim.