Longtime budget gurus prepare for battle

The following first appeared in Capitol Weekly As the budget negotiations heat up this summer, attention invariably will turn to the Big Five, the much-ballyhooed set of meetings between the governor and the four legislative leaders. But as five of the state's top elected officials huddle in a gubernatorial conference room, Craig Cornett will be seated just outside in the hallway. It will be Cornett's sixth year in that hall. As Assembly Speaker Fabian Núñez's point man on the budget, Cornett is part of what is sometimes referred to as the "Little 4," the anointed budget gurus of each of the legislative leaders. It is the job of Cornett, along with his Senate Democrat counterpart Diane Cummins and Republicans Jeff Bell and Peter Schaafsma, to translate the decisions of the Big Five into what eventually will become the annual budget. But the job is much more than that. Both Cornett and Cummins, in particular, are said to wield incredible power in shaping the intricacies of the $114 billion, 700-page document. "The thing I like about the budget is it is the broadest, boldest statement of public policy every year," says Cornett. Cornett, however, does more than counsel the speaker on the budget. In 2004, Cornett was part of a small team of senior staff that developed what became propositions 57 and 58, the governor's $15 billion economic-recovery bond package. He says negotiating that package was a highlight of his two-decade California budgeting career. "That was incredibly important for the state. If we had not gotten that $15 billion bond, we would have been in serious, serious trouble," said Cornett. During this year's mega-bond negotiations, Cornett has coordinated the staff-level negotiations for Assembly Democrats. And when Núñez and Schwarzenegger met privately to try to hammer out a deal, Cornett was often Núñez's lone staffer at those meetings. With the advent of term limits, members of the Assembly are limited to a maximum of six years, increasing the role of staff, like Cornett, with years of experience, particularly in complex fields like the budget. "People like Craig Cornett are the thread that keep this institution together," says Núñez. "He is a guy who in my view not only knows more about the budget than just about anybody in this building, but the institutional memory that he carries with him is just invaluable." Cornett has been working around the California budget ever since he graduated from public-policy school at the University of Texas. In 1983, he was hired by the Legislative Analyst's Office (LAO) and "was promoted really rapidly," according to Mike Genest, who worked with Cornett at the LAO, and now is the director of the Department of Finance. "I would say he is one of the very top guys. He is very widely regarded because of his expertise and willingness to listen," said Genest, who is in charge of crafting Governor Arnold Schwarzenegger's annual budget. "He is soft-spoken … but iron-willed." In 2001, then-Speaker Robert Hertzberg, D-Van Nuys, coaxed Cornett into the Legislature to serve as the Assembly Democrats' budget specialist. He has remained in that role under speakers Herb Wesson and Núñez. Cornett's budget tenure in the Assembly began with the last breathe of the dot-com boom, ran through the bloated deficits of 2002 and 2003, and has continued with the slow crawl toward fiscal balance under Governor Schwarzenegger. Now, Cornett is among a small crew of longtime budget analysts that are crucial to producing the annual budget, most of whom have worked together for more than two-decades. Genest has been around the budget since 1981, starting in the LAO. Cummins, the budget expert for Senate President Pro Tem Don Perata, D-Oakland, spent 20 years at the Department of Finance before shifting to the Senate in 1999. Elizabeth Hill, the Legislative Analyst, has worked at the LAO for 30 years and has headed the agency for two decades. Brad Williams, the LAO's fiscal and economic forecaster, began at the LAO in 1978. Assembly Republican budget man Schaafsma started at the LAO in 1976. Only Senate Republican budgeter Bell, who has been working on the budget since 1997, has less than 20 years experience. "This is a small little world," says Cummins. "I think a lot of us have a lot of experience, and even though our bosses all have different perspectives, we work well together. There is a lot of camaraderie--we have a budget to produce." Everyone affiliated with writing the budget describes Cornett as decent, intelligent and a straight-shooter. "The thing that sums him up is he's got an uncommon ability to be 10 times smarter than anyone in the room without making you 10 times less smart," said Christopher Woods, chief consultant to the Assembly Budget Committee. Throughout the Capitol, most staffers are reticent to admit too much influence over legislation, saying they give recommendations to elected officials but don't make decisions. Cornett is no different. But he does admit that the budget is a different beast than most policy areas. "There is a lot of detail in the budget so the staff is critical to that," he said. Looking ahead to this summer's budget, Cornett said that elements out of the control of the Legislature are likely to drive the dynamics of the negotiations. The current fiscal year has produced better than expected revenues, on the order of $2.3 billion, and "better revenues always make it easier," says Cornett. But uncertainty about the exact size of the windfall makes for treacherous decision-making. In addition, he says, there are several outstanding lawsuits against the state, each of which could cost California's budget coffers hundreds of millions of dollars. And, of course, there is the state's seemingly intractable structural deficit, now estimated at $5 billion. "It overhangs everything," he said.