Last decade or so where you have all this red ink and the surpluses are rather modest. And you see where we are. We barely have a surplus. Even if you add the Rainy Day Fund that would come up about where that black bar is. And nothing like all the red bars. Or you know, i thought of another way to do this. If we put it this way, you can see that were really doing well. There are a lot of restrictions on how the state can spend the money but the governor has plans for some of it. Scott shafer is going to discuss those plans with a panel of guests. Joining me are jill tucker San Francisco chronicle education writer. David crane, stanford lecturer and president of political advocacy organization, governor california and john myers joining us from sacramento. Almost to all of you. And john starting with you, a big week for the governor. You were there when he unveiled the budget. What are your take aways . The big message is it continues what brown has done since he has come to office which is chart a middle path between more spending and not spending enough. And the other part that i find interesting here is that it showed i think the governors skills as politician. The guy likes to talk about policy and i dont think people think of him as a pure politician but he had a couple of good moves here. He outflanked democrats in the legislature on issues about the working par with tax credits and i think also he scored a win win on the issue of tuition raises at uc with janet that pal tan know in these private meetings. They unveiled this deal that showed that brown is a good politician. I think that really set the tone for not only this budget but what happens in the next month. And well come back to both of those in a minute. John i heard you describe jerry browns budget as a manifesto of moderation. What does that mean . Its jerry browns governing philosophy. He takes a portion of what people are saying and use it to his advantage. The first two topics i think he has done it all through his career especially in these last four and a half years whether on taxes or spending. And i think the governor is giving people a little bit but not going as far as they want to. Whether the governor keeps that upper hand over the course of the next couple years as his term ends remains to be seen but the governor is driving the ship on how much revenue he thinks were going to get. Theyre his numbers and what to do with it. When you made reference to the earned income tax credit. Describe if you could what it is. Its a tax credit for the work poor. Is it the people who earn the lowest amount in california for instance a family of four this would only apply if they only earned 14,000 a year. That is the lowest of low income. They get money back automatically from their taxes. It could be a few hundred up to 2,000. There is a federal earned income tax credit. This would match along with it. And a lot of people think its the right thing to do. Lets hear what the governor had to say about it. And given the tremendous growth in income on the part of higher income people i thought it would be reasonable to establish this program in california. Ive always liked the earned income tax credit. Its just a straight deliverance of funding to people who are working very hard and earning little money. So david crane the governor has been under pressure to do something about poverty. When you think of all the things you can do raising the minimum wage is another how does the tax credit stack up . I think its the smartest choice for the reason the governor described. Its a way to get benefits to working poor without establishing a new bureaucracy. The bigger issue is whether it moves the needle significantly. A quarter of the people are below the poverty level. That is nearly 10 million people. If you are going to move the needle you have to do much more which we can get into today. And how much are we talking about . 380 million. Per person, to an individual. I heard about 460 bucks. You know better than i. Is that going to satisfy democrats in the legislature . I think its going to be hard to turn him down on it. They had ideas of their own. There have been discussions of a larger earned income tax credit than that. The governor of course charting that middle path finding a way to give people something but not quite what they wanted. I think its hard to say no. I think the governor is going to win on this and to davids point. The question is does it solve the problem enough. This is the lowest of low income. What about other workingclass californians who might need relief in some way shape or form. And jill tucker, it has been years of cuts for schools and schools and educators are happy that some of the money is going to the schools. And by law a lot of it has to go. To what extent does it make up for cuts . I think were getting closer. While the amount is really close to where the schools were before the recession and i think they are exhaling for a second year in a row. But a lot of the programs were cut so deeply that trying to get back to the low class sizes or cost of living increases you are still cautious. The districts are struggling to decide how much of teacher raises to give how much to commit. I think everybody is still feeling that fear and agony of the recession. It was so strong that really, theyre trying to weigh how much to put into this. But really theyre getting a lot more money. Theyre getting 6 billion more than they thought. Its a lot more than they thought they were going to get. So in that sense dont get me wrong, theyre very happy. Theyre much happier than the poverty advocates. How does it play into the concerns about longterm costs . The governor has said as part of this manifesto of moderation we dont want to commit today what we dont know is going to be there. Is this going to put cost of living costs on the budget forever . This budget proves what a politician that jerry brown is. Because what he did is i view this as a kus toad yal type budget. Its a budget for someone who understands as the governor describes very clearly in his budget the cycles of californias budget. He knows the tide will go out the way it came in. The stock market is up 60 in his tenure which is more than it went up for gray davis and for schwarzenegger. The revenues are way up. And he wisely in my view isnt going to spend it on new programs. The eitc is a good way to do it. The Oakland School district of giving a bonus rather than baking something into the salaries is a good idea. But what he didnt address is what caused the problems when the tide goes out. For example, spending today in california on most services is lower now than it was before the recession even though revenues are up 30 higher. And thats because the state is spending so much more on Health Care PensionsRetiree Health care and compensation. He didnt address those problems. Thats what he is going to do if he is going to address the cycle. You mentioned health care. And the governor put money in the budget just in case for medical if president obamas executive order putting some folks here without documents on the path to citizenship. Lets hear how he described what he did and why. Were putting money in for immigrant health care to cover those in the event that president obama is successful in putting a certain number of immigrants on the path to citizenship. John myers, how big a departure is that for a governor to put money aside for something we may or may not have to spend it on . I dont think its a huge departure scott. I think governors make these plans and things change and you adapt to them. I think that jerry brown has talked a lot about in the last couple years ways to make the immigration issue forward if its not going to happen in washington, its going to happen in california. Making a plan for bringing the folks into the medical system. But there is a proposal in the legislature to give medical services to all undocumented immigrants in california not just ones subject to the president s executive order. But i think this could be substantial. One more thing on health care if you look at broader. We now have a third of californians in the medical system. Its a phenomenal number and i think it goes to show the complexity of the income gaps in california and how you deal with them. John, i wanted to ask you, for education that money is locked in by prop 98 and other things. Hes made a deal with Janet Napolitano for no tuition increases. The committee of with the. He set aside money for the immigrants and talking about all these things. Im wondering where is the wiggle room and where are the debates going to be in the legislature in terms of what kind of money is out there for them to play with . You know, i think that he has narrowed the Playing Field a lot. And that is one of the more interesting parts of the way that jerry brown has governed up here. Even if i can just to go inside the issues on the uc thing, this deal that brown and thatnapolitano have struck. No tuition hikes for two years and money towards the pension problem and other infrastructure needs. All of this again, i think democrats in the legislature, they have been talking about more. They want more accountability for uc and a longer guarantee. They want uc to explain how it spends all of its money. I think that could be a debate. And some of these health and Human Services programs. We talked about medical. People say you have all these people in the system but if they cant find a doctor whats the use . Thats an expensive thing. But the governor has the upper political hand here. I think its going to be awfully hard to see him give up more over the next month. David crane as the governor pointed out we are not out of the woods. What would you like to see the governor and Legislature Work on in terms of getting the fiscal house in order. Address pensions Retiree Health care, Health Care Spending and a dysfunctional tax system. And uc is a good example of this. Its a convenient punching bag. The reason that uc raises tuition is that the state has cut spending at uc. And the state is spending so much more on pensions and Retiree Health care and things like that. And the other big issue is the state agreed they crammed down 170 billion worth of pension costs which will designate that system. They have until june 15th to work it out. Thank you all for being here. And now, to the bay bridge. Youre looking at some of the hundreds of rods that holds the bridge together. One of the rods failed a key Structural Integrity test last week. The test result suggests that salt water may be causing the rods to corrode. Its the latest in a long list of problems. Joining us now in the studio to talk about this are, Steve Heminger jaxon van derbeken, and Brian Maroney. Mr. Maroney, first i want to play a comment from when you appeared on our show last year following the revelation of the first batch of broken rods and cracked wells. You insisted then that the bridge was safe. Lets take a look. I think there has been some misunderstanding about something being perfect. Any time you do a billion things there are going to be a few challenges. And of course thats practical and were we are addressing those things but i still feel this bridge is sound. Its very good. The public can be very proud of it. So mr. Maroney this is more than just a few issues. 15 months after you made that statement we are hearing about more problems. Can you reassure that the drivers who cross the bay bridge every day it is indeed safe . Absolutely. Its been planned out well. We worked with the community, followed a tight selection following the National Environmental policy act. We designed seismic loading that is superior over bridges and buildings in california and across the united states. The materials the contractors, the engineers, the planners, the environmentalists that worked on it have all done a great job. There are a few elements here and there that weve actually had to inspect. Contractors dont build things perfectly. Thats why we requires the contractors to do Quality Control testing and they test and check things and they have to redo things sometimes and we follow up with qa and sometimes while we test most of the time they pass but every once in a while they dont pass the test and we did a test last week and i got really great support from the toll Bridge Program oversight committee. They allowed me the funding to do those tests and we caught one and we have gone through another 3 4 way through 400 of the other rods doing additional testing. So far everything is look great. But we did that Quality Assurance test and that is what Quality Assurance and Quality Control inspection is all about. And we did catch one and now were going to have to deal with it. If a big earthquake hits tomorrow you can say with certainty that that bridge will not collapse and it will still be operational . Yeah, im an engineer. There is no absolutely certainty when it comes to an earthquake. But up and down the state of california this is a very, very safe bridge. This is a welldesigned, wellconstructed, wellplannedout and in the future, i hope, i trust it will be well maintained and always be safe. You have a great bridge here and should be proud of it. Jaxon van derbeken you have been covering this story extensively. What are independent bridge engineers telling you . Its not a matter of whether it is safe now or its more like how it was constructed and whether they borrowed into safety margins when things didnt go well, youre supposed to keep a safety margin in reserve so to speak because you dont know how materials are going to behave or whether they will be uniform. You want to have a comfort zone and what a lot of experts question is that when components came in such as the bridge decks and they didnt align properly they had to cause these welds and they are not to caltrans standards. They had to take safety margins and eat into them. In this tower you have another issue where components that were designed to last 150 years and be resistant to corrosion may be succumbing to corrosion. There is signs of cracking and they have only been around a short time. So Steve Heminger who should be held accountable . The folks who built this bridge are one party. The folks who designed this bridge are another party. And the folks who oversaw the design and the construction are a third. I think we do need to connect accountability to particular problems, though. And on the east pier of the bridge we had a particular problem a bunch of these rods broke and we had to spend 25 million to fix it by replacing it with a different kind of fastening device. That cost we intend to recover. Because it was a problem and there was accountability that we established after an investigation. In the foundation of the tower were not sure we have a problem yet. We do know that we have water down there and we dont want it there. And whether its fresh water or salt water we want to get rid of it. But whether or not it has affected the rods that hold down the tower were still in the phase of the investigation where we dont know the answer. There is public frustration right now. 4 million was approved to look into the salt water issue and a lot of people want to know why hasnt anyone been held accountable yet. The reason we dont have any kind of financial settlement on the east pier is because we dont have a completed contract yet. Once the contractor is finished with the suspension bridge then we will be entering negotiations on exactly that question. Accountability and financial accountability in particular. Mr. Maroney he thinks caltrans should be one of the parties held accountable. Do you feel that this is more of a design problem or a caltrans execution problem and you should be held accountable . I like to look into the test data and complete the investigation be thorough and complete and evaluate the facts, analyze those and then there is an accounting. Right now its too early. People are throwing out opinions. Im someone who wants to say lets get the factings and order them and get them to the right people and that accounting day will be laid out among the people that director heminger just described. You are still following this story closely. Are there other potential problems you are looking into . I think we know a lot and theres a lot we may not know until something else. They call Brian Maroney uses the phrase shake down. Theres a chance that there are other problems that could be materializing over time. The problem with the tower rods was one that they didnt think they had. And they basically stumbled on to it when there was evidence that caulking that was supposed to be keeping water tight seals around the rods started to peel up and there were signs that water had been getting in and they look further and find water and now finding salt water. They didnt think they had water and they may have salt water which is another problem altogether than what they envisioned. Things einvolved and you dont know. As the shake down continues. And brian you mentioned earlier you are inspecting the rods and all the ones you have inspected so far have come up clean. When will the process be finished and are you confident the rest will come up clean. Its hard to imagine one would be problematic out of 400 rods. It depends on the results of the investigation. Sometimes one is a unique outlier response. Other responses might be systematic. So you have to finish the investigation. And its important i think also to say it wasnt just stumbled across. Great caltrans inspection engineers Construction Engineers went searching. They were going through the final walk through last year and they found water and they looked further and they found caulking that was up. And they pulled up 12, found water. Pulled up 100 found water. They went searching. Thats their job. They did a good job finding it and now were going to make sure that the contractor grouts those as they should have done in the first place and somebody will be held accountable for that. Steve the list of problems goes on and on. Broken rods water leaks, cracked welds, missaligned bridge decks. Who should pay for these . Some of the issues you just raised i would put more in the form of questions. There is not a consensus they are problems. And in the case of nonproblems i dont think there has to be accountability. What are the nonproblems. The notion of welds cracking. There were cracks in welds when they were made in china where the bridge was fabricated. Those were corrected before the shipment of the boxes was occurred and before the steel came to america. So its true there were cracks at a point in the production process. But by the time they got here, the cracks had been fixed. And not only that but we commissioned an independent group of engineers and experts to make sure we had done that job right and they concluded that we did. So there have been a few urban myths that have grown up around the bridge and it is understandable. Some things have gone wrong and we need to fix the things that are wrong but it doesnt help us fix them when we are trying to address phantoms and nonproblems together with the real ones. Who should pay for the real problems then . The real problems we have done an investigation of one of them the one that caused a particular fix to occur and that fix ended up costing us 25 million. And we determined that the three parties i mentioned earlier the contractor, the designer and caltrans were accountable for it. And we will be fixing that accountability financially before all is said and done. You know a lot of people are feeling like the taxpayers are having to pony up once again. The tolls went from 1 to 6. If you are a daily commuter it costs about 1500 bucks a year to use the bridge and we are getting the bridge despite your reassurances a lot of people feel is unsafe and problematic. The issue of safety is i tell a story is it safe to drive a car without a seat belt . It is if youre not in an accident. You have to understand that this bridge is designed to be seismically endure a for 150 years. There is normal wear and tear. That is one of the issues with the cracked welds. They are not a seismic threat but there have been questions raised by caltrans engineers about their longterm durability whether they can survive the rumble that cars and trucks provide over many many years millions and millions of traveling times. Thats one thing youve got and youve got the issue of whether the seismic components of the bridge, which it is a very important seismic design that they embarked on here. But there are also questions about lack of redundancies. There is only one tower. Theres only one cable and youve got people asking questions about you know, a component unlike typical suspension bridges where there are more than one tower and more than one cable. People are asking questions and it all gets to the issue of Public Confidence and trust. Brian, this bridge was years late, its over budget and all these safety questions. How can you restore public trust . First of all we have to be transparent. I travel up and down the state of california communicating to the American Society of civil engineers, universities, when they ask me and i explain in details. You started this discussion with a rod failed a test. I want to make sure you understand we are testing the other 421 rods not only for pretensioning load but a seismic load. We are doing a practice earthquake run on the other rods. We are 3 4 way through of them and they look great so far. Thats important. We are doing a proof test on an earthquake load. And the inspection that weve done on this, the number of people, tremendous extraordinary extra steps beyond what is normally done on a bridge. Fair enough. Brian thank you so much. Thanks to all of you for being with us. Steve heminger Brian Maroney, and jaxon van derbeken. And that is going to do it for tonights show. For all of kqeds News Coverage go to kqed. Org. Im thuy vu. Have a good night. 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