DELAY PAYS IN SACRAMENTO; LAWMAKERS PAID MORE, VENDORS NOT AT ALL.

Byline: Paul Hefner Daily News Sacramento Bureau

California's budget stalemate is putting the squeeze on folks like George Dern, but for lawmakers, each day's delay means a $110 bonus.

Until a spending plan is approved, the state won't reimburse Dern for the medicine his Van Nuys pharmacy has supplied to Medi-Cal patients since July 1.

Dern figures the state already owes him $20,000. For now, he's managing by stretching out payment of the pharmacy's bills.

``It's extremely inconvenient,'' he said in a telephone interview. ``We're just hoping they'll get their act together.''

What Dern didn't know was that because the budget deadlock has cut into the monthlong hiatus lawmakers were due to start July 18, politicians will be eligible for extra living expenses for each additional day they spend in the state Capitol.

Lawmakers can choose to waive the per diem payments, which they receive on top of their $78,624 annual salaries. They won't see either a salary or per diem check until after the budget is approved. But once it is, they each stand to collect an extra $770 for continuing the stalemate through last week alone.

``That sucks,'' Dern said.

But despite the potential for gain, lawmakers say the budget stalemate frustrates them as much - if not more - than the public. The impact of the deadlock is softened because most state employees - aside from lawmakers and their staffs - continue to collect their pay during the impasse. But businesses that count the state of California among their customers don't.

Criticism mounting

As closed-door negotiations drag on, criticism of the state's budget process is mounting among Democrats and Republicans. But some fear that there will be no resolution until the public - which so far has paid scant attention to the issue - gets angry enough to demand action.

That's the reaction Assemblyman Robert Hertzberg, D-Van Nuys, is coming to expect - especially over the extra expense pay.

``I think they're going to be very mad, and I understand why they'd be mad,'' Hertzberg said. ``The argument is there's an incentive not to pass the budget.''

Like the vast majority of his colleagues, Hertzberg isn't a member of the ``Big Five.'' Made up of Gov. Pete Wilson and the leaders of the Assembly and Senate, the group has met privately more than a dozen times without reaching an agreement on a state spending plan.

There's little lawmakers who aren't directly involved in the negotiations can do to influence the outcome.

``I feel like I'm a soldier who has taken the oath, gotten a uniform and a rifle and been sent overseas without any bullets in my gun,'' he said. ``I'm totally frustrated.''

Bills stacking up

State Sen. Adam Schiff, D-Pasadena, said the extra days in Sacramento have forced him to cancel meetings with constituents and local officials. In addition, the budget impasse has meant a cash-flow crunch within his own office.

``I'm not even able to pay the rent in my district office,'' he said. ``I feel it in a very acute way.''

He's not the only one with bills starting to stack up. The state is holding up payments to dozens of hospitals and pharmacies. Some checks to local governments are being held up as well, including $200 million in motor vehicle funds due to be passed out earlier this month, officials said.

The state Department of Forestry has accumulated $100,000 in bills it's not yet authorized to pay. Businesses that provide services to the department have been cooperative so far, but a Stockton firm that maintains the department's fleet of firefighting aircraft has warned that it may suspend service if the stalemate extends through the middle of August, officials said.

The department already had to withhold some payments earlier this year when a funding bill got held up in the Legislature. That measure finally was approved last month.

``Our vendors are unhappy with us already,'' said Howard Sarasohn, the department's deputy director of management services.

Who is to blame?

Theories abound about why officials once again missed the June 15 deadline for approval of a budget. Some say lawmakers left too many issues to be resolved, including welfare reform, tax cuts and pay raises for state workers.

There's the blame Wilson theory: ``We passed a welfare bill and he vetoed it, and that's why we're still here,'' said Sandy Harrison, spokesman for state Sen. President Pro Tem Bill Lockyer, D-Hayward.

Republicans, in turn, fault Democrats for taking too long to reach a consensus on the welfare issue - and for doing too little to accommodate conservatives with their plan.

But some lawmakers from both camps are finding fault with the ``Big Five'' process itself, which leaves the haggling over the state's spending plan - as well as major policy issues - to Wilson, Lockyer and three other top lawmakers.

``It freezes out every constituency in the state, save four, and has been very consistent in setting new records for late budgets,'' said Assemblyman Tom McClintock, R-Granada Hills.

Their annual negotiations have made the regular budget hearings nearly meaningless, he said.

``The whole process has been corrupted beyond recognition,'' McClintock said. ``I would say 80 percent to 90 percent of the year's major policy decisions are now being settled behind locked doors in a span of about two weeks.''

Others are questioning the process as well. Assemblyman Don Perata, D-Oakland, is circulating a resolution calling for an end to the Big Five negotiations.

Locker's view

Lockyer said that the problem is not the Big Five, it's the state's requirement that the budget be approved by a two-thirds majority in each house of the Legislature.

He announced last week that he supports amending the state constitution to make the budget vote a simple majority - and would make lawmakers forfeit their pay if they miss the deadline.

``I think we would be on time every year if we could do it by a majority vote,'' Lockyer said last week. ``We learned in kindergarten that majority rules.''

Others suggested that part of the problem is the public's disinterest in the issue. Late budgets are routine in California. The last one to be signed before the July 1 start of the fiscal year was in 1993.

``The public views it as an intramural game that goes on in legislative circles,'' said Mervin Field, associate director of the Field Institute, which conducts statewide public opinion polls. ``From what I can see and feel, it's not something that has captured the attention of the public.''

Public is tuning out

Others have sensed the same thing, as well as a broader disinterest about government itself.

``You see this happening on the federal level as well, people are so turned away from government, they're just not paying attention,'' said Sherry Bebitch Jeffe, senior associate at the Claremont Graduate School.

But that could change, she warned, recalling the budget impasse in 1992, which dragged on until September.

``The voting public started to get angry,'' Bebitch Jeffe said. ``Everybody was waiting for the first elderly parent to get evicted from a nursing home.''

Fear of an angry electorate can be a strong motivator for lawmakers, she said.

``Until it begins to hurt directly and personally those voters out there, then that motivation to complete the task isn't there,'' she said.

Lockyer said he hopes that doesn't happen.

``Most people don't operate at their best when they panic,'' he said. ``And that's what pressure brings - panic.''

But the number of business owners carrying unpaid state bills is growing each day. And each of them has financial pressures of their own.

Mike Lewis, who owns Reliable Pharmacy in Northridge, said he considers himself better off than some pharmacists, because Medi-Cal reimbursements only account for about 20 percent of his business.

Still, he estimates that the state owes him at least $40,000. His patience is wearing thin, but he's not quite sure what action to take.

``I'm agitated, but what am I going to do? What leverage do I have?'' he asked. ``I can write a letter - they'll tell me they're doing something. But are they?''