** The California Recovery Team, Governor Arnold Schwarzenegger’s 2005 special election initiatives committee, settled a case brought before the state’s Fair Political Practices Commission today by the Alliance for a Better California. (ABC) public employee unions coalition. ABC had charged that the Arnold campaign committee violated state elections law last year by not filing daily reports detailing its large expenditures on behalf of the governor’s four unsuccessful “Year of Reform” initiatives. The committee has agreed to pay a fine of some 200.000 dollars. That is less than the 263,000 levied against Democratic gubernatorial candidate Cruz Buistamente in the 2003 recall election and slightly more than the fine against Senator Dianne Feinstein in 1992.

The CRT prevailed in a trial court action brought during the election on the same grounds. But an appeal was made. Meanwhile, the CRT made the filings in dispute and ABC filed a complaint with the FPPC.

>** State Senator Chuck Poochigian, the Republican challenger in the race for state attorney general against former Governor Jerry Brown, is on the air without fanfare. An eagle-eyed New West reader — there is a reason why Slate’s Mickey Kaus calls you all “bizarrely useful” — spotted a Pooch TV spot running on Fox News in Sacramento.

The Poochigian campaign confirms the report. But won’t say where else, or how often, the spot is running. The spot, incidentally, is the humorous one first linked to here depicting “famous fictional crime fighters” … Batman, Dick Tracy, Dirty Harry, and Jerry Brown.

At least twice in the past few days, Democratic gubernatorial nominee Phil Angelides has made intriguingly softened statements about his centerpiece plan to raise taxes. “As governor, if I need to do it,” the challenger to Governor Arnold Schwarzenegger said to a Chico TV station, “I’ll close corporate tax loopholes, I’ll ask people who make a half a million dollars or more a year to give back some of the tax breaks they’ve gotten.”

He said the same thing to another TV station. “If I need to, I’m going to close corporate tax loopholes and I’m going to ask people making over half a million dollars or more a year to pay their fair share again so we can have the best schools, more affordable college, balanced budget.” The Angelides campaign had no comment on this equivocal-sounding stance.

If he “needs to do it?” That is a different tone from the Democratic primary just past. There was no equivocation there. The treasurer made a very resolute statement on April 5th, when he declared his tax hike program the centerpiece of his agenda.

“I’ll fully fund our schools, roll back the Schwarzenegger tuition hikes, expand financial aid, and open the doors to college wider than ever — and I’ll balance the state’s budget. I’ve said exactly how I’ll pay for this — by closing corporate tax loopholes and asking multi-millionaires to pay their fair share again.”

A Democratic advisor following the governor’s race closely notes that it is time for Angelides to try to get back toward the center. “He had to go hard left to beat Steve Westly, to appeal to the hardcore, tax-and-spend voters that could win it for him in a low turnout primary. It was the best, easiest way to make him the real Democrat in the primary and survive that eBay fortune.”

Meanwhile, Angelides has found an industry he thinks should get new tax breaks. The entertainment industry. Usually, it is a big source of funding for Democratic candidates for high office. It hasn’t been so helpful to the opponents of Arnold Schwarzenegger. Angelides told the Associated Press yesterday that he wants new tax breaks to stop the phenomenon of “runaway production” to other states and countries. How would he pay for these new tax breaks? By eliminating other tax breaks, i.e., closing corporate tax loopholes.

But nearly three months after he unveiled his tax plan, it remains remarkably vague. Even before Angelides proposed to call on it for another set of state expenditures.

When I asked Angelides following his April 5th speech laying out the program to specify which corporate tax loopholes he would close, he replied that he had a “$2.5 billion” program of corporate tax loophole closures, saying his campaign would send me the list. Which it did not.

Later that day, following his debate with Westly at the taping of Univision’s Voz y Voto, we did return to the question of exactly what the treasurer is calling for. I had asked him earlier to be specific about his corporate tax loophole closure program, and he had said his staff would send me a list. What was actually sent was not a list of those loopholes Angelides proposed to close, but a very general discussion of the state’s fiscal situation.

Noting this, I asked the treasurer to name some of the loophole closures in his program. He mentioned three, then referred me to the web site to look up the rest. I didn’t see the program on his web site.

Later, the Angelides campaign, via sometime communications director Nick Papas, sent me a list of corporate tax loopholes to be closed. Only eight, and with no revenue figures attached to any of the loophole closures.

“Close the “yacht loophole.” Eliminate special resource depletion deductions for gas and oil companies. Keep small business Subchapter S tax break for small businesses alone. Repeal sales tax exemption for farm and timber machinery. Repeal sales tax exemption for diesel used in agriculture. Repeal sales tax exemption for liquid petroleum gas used in agriculture. Close the expatriate corporation loophole. Close the “nowhere income” corporate loophole.

“Additionally, the Treasurer has proposed legislation requiring a detailed annual review of tax loopholes currently in the tax code as part of the budget.”

That was it from the Angelides campaign.

In the absence of an Angelides analysis of his program, the California Taxpayers Association, which opposes tax increases, did its own analysis of how much revenue the proposed Angelides corporate loophole closures would provide the state. They came up with a total of less than $1 billion per year.

Those sums are all well under the $2.5 billion per year Angelides cited after his rally speech.

Later in the spring, after many questions about the continued vagueness of the program, Angelides press secretary Brian Brokaw said that what the treasurer is providing in terms of detail are “examples” of what he would do, if he were to win the election.

The full program would be unveiled later.

With this week’s rhetorical hedging — and a new proposal not for “loophole” closure but loophole creation — it is time to see what “exactly” the program is.

** Democratic gubernatorial candidate Phil Angelides has an industry he thinks should get new tax breaks. The entertainment industry. Usually, it is a big source of funding for Democratic candidates for high office. It hasn’t been so helpful to the opponents of Arnold Schwarzenegger.

** Could juvenile crime rates in California actually be going down?

** NWN has been very slow to load since late morning and I have had trouble posting. It turns out that the server hosting this blog and others including the LA Weekly and OC Weekly has been under a concerted attack.

** In a move denounced by a conservative leader as turning the California Republican Party into a “gay marriage party,” Arnold Schwarzenegger headlines a big LA fundraiser tonight for the Log Cabin Republicans.

After all the back-and-forth between Governor Arnold Schwarzenegger and President George W. Bush on sending California National Guard troops to augment the role of the Border Patrol in the so far fruitless attempt to secure California’s border against illegal immigration from Mexico, there is some rare good news. Major General William Wade, commander of the California National Guard, says that the deployment of troops is “well ahead of schedule.”

Wade says he will soon have 750 troops in place of the 1,000 ultimately being sent to assist the Border Patrol by performing support functions allowing agents to work in the field. As of yesterday, there were 722 National Guard troops on orders for Southwest Border duty. Of those, 384 had reported for training. They expect to have 900 troops on orders by Friday. The goal, set by the National Guard Bureau, was to have 500 on orders by Friday, so that is already exceeded.

Meanwhile, there is a certain level of confusion in some press and political circles, both about the nature of Schwarzenegger’s refusal of a request for more troops from Bush and about the likelihood that the refusal was a political ploy.

A number of media outlets, especially on cable TV, have been confusing the issue. Schwarzenegger didn’t refuse to send more troops to the California border, he refused to send more troops to other states, namely Arizona and New Mexico.

General Wade, a highly decorated infantry officer, and others say California was called on by the Bush Administration because only a few other states were prepared enough to send troops and California was already in the process of gearing up for border duty.

Schwarzenegger and Wade’s deployment plan, which focuses on volunteers, differs from the original Bush plan, which called for putting Guardsmen on border duty instead of performing their annual two to three-week training exercises. Schwarzenegger said that arrangement would have created major problems in logistics and morale.

Some Democrats, perhaps frustrated by Schwarzenegger’s refusal to fall into the hoped for partisan stereotype of being a Bush acolyte in mostly blue state California, are saying that Schwarzenegger’s refusal of the president’s request is a put-up job, a political play hatched with the White House and the nefarious mastermind Karl Rove to make the governor look more independent than he really is. Phil Angelides for Governor senior advisor Bob Mulholland sent a missive to reporters saying as much.

Wade says that Washington requested California National Guard troops because they had a higher level of readiness than most other states, pointing to the relatively swift deployment that is underway now. Why not help out the other Southwestern states with California Guard members?

“I may have to send troops to Nevada to help with the fires there,” Wade says. “We could easily have crises here. We can’t afford to be deploying our troops to Arizona and New Mexico.”

Mulholland and some others say Bush knew Schwarzenegger would refuse, which is why he made the request. Politicians are certainly not above such kabuki plays.

However, there’s never been much warmth between this governor and this White House. Schwarzenegger was quite friendly with the first President Bush, who appointed him chairman of the President’s Council on Physical Fitness. But the spark of friendship has never flared with the current President Bush. And the governor’s relationship with Rove has seemed frosty.

Indeed, Rove favored not Schwarzenegger as the Republican gubernatorial hopeful in California, but Condi Rice, the longtime Bush foreign policy advisor and former Stanford provost who is now Bush’s secretary of state. In 2000, Rove moved to block Schwarzenegger from a substantial speaking slot at the Republican National Convention, pushing him for a celebrity role instead.

When Schwarzenegger ran for governor in the 2003 recall, he made a point of naming liberal investment icon Warren Buffett as his chief economic advisor on the eve of a Bush visit to California. The move not so subtly differentiated Schwarzenegger from Bush. But it backfired when Buffett famously mused to the Wall Street Journal on what he saw as the need to rework Proposition 13.

** Here is another problem with U.S. border security. In addition to the National Guard problem which had the Bush White House looking to California to pick up the slack in other border states, nearly five years after 9/11 there is apparently no intelligence on the border situation, either.

** KQED’S John Myers reports on legislative committee passage of LA Mayor Antonio Villaraigosa’s school reform plan.

** The comments problem seems to have been fixed. According to the tech, NWN’s aggressive anti-spam filter was interfering with the posting of some comments. The filter, incidentally, has caught tens of thousands of spam messages.

UPDATE: Spoke too soon, there are still problems.

** Speaking of the LA Weekly, as we have been, reminds of a bizarre episode late in the unlamented primary just past. A dyed-in-the-wool Phil Angelides supporter alerted me to what she said looked like a “strange” endorsement listed on Angelides’ web site. That of the LA Weekly. Which was especially intriguing, since the LA Weekly, like all but a few newspapers in California, had actually just endorsed Angelides’ rival Steve Westly in the Democratic primary for governor.

I looked at the endorsement section of the Angelides web site and found the listed endorsement of something called “Los Angeles Weekly News.”

What on earth was THAT? I ran a net search on the term, and — aside from references to, naturally, the LA Weekly — found no references more current than 1973.

I asked journalist colleagues and PR specialists in LA if they were familiar with anything called the “Los Angeles Weekly News.” Once they realized I was not referring to the LA Weekly, they all said they had no familiarity with any such newspaper.

So I e-mailed the various communications and political poobahs with the Angelides for Governor campaign, asking what they meant by this listed newspaper endorsement. (It was one of only a handful. The others were the Los Angeles Times, Sacramento Bee, San Francisco Bay Guardian, and Bay Area Reporter, which I have also never heard of.)

I received no direct reply from Phil or his aides regarding this mystery. However, the endorsement of the “Los Angeles Weekly News” was removed from the Democratic gubernatorial candidate’s web site.

** Well, I can’t post comments, either … There is something wrong with the comments section. I have e-mailed the stalwarts at LA Weekly tech support.

Ever since he began his leftward move in the immediate wake of his special election defeat last year, many Republicans have wondered aloud what Governor Arnold Schwarzenegger was going to do for the party’s base voters. For months it continued as he promoted environmentalism, social spending, and the biggest infrastructure package in California’s history. Now he is pivoting to an area of “red meat” concern for the base, crime.

Even as he was quelling a rebellion on the right at last February’s California Republican Party convention, Schwarzenegger gave little rhetorical attention to issues that stir up more conservative voters. He mentioned his support for the “Jessica’s Law” anti-child molester initiative only in passing during his speech to convention delegates, for example. That’s changing now. With his centrism re-established, the former action superstar is zeroing in on the crime issue, taking advantage of having an opponent, Treasurer Phil Angelides, with little track record on crime and even less of a policy profile.

Team Arnold has been dogging Angelides on crime of late, having prominent law enforcement figures in the regions the Democratic candidate campaigns in challenge him to take a position on Jessica’s Law. He has yet to do so, and for liberal civil liberties reasons, is not seen as one of the initiative’s likeliest supporters.

Today Schwarzenegger appears at an event trumpeting his endorsement by six law enforcement organizations: The California Police Chiefs Association, the California State Sheriffs Association, the California Peace Officers Association, the National Latino Peace Officers Association, the California Narcotics Officers Association, and the Los Angeles County Police Chiefs Association.

Later in the day, his campaign will also announce its public safety coalition, consisting of prominent individuals such as various district attorneys around the state. Schwarzenegger struck up an alliance with county prosecutors when he intervened, with the assistance of former Governor Jerry Brown, to defeat the three-strikes sentencing reform initiative, which had enjoyed a wide lead in the polls, in November 2004. When he needed a friendly forum for his prison crisis speech on Monday, the California District Attorneys Association provided it.

Angelides is supported by the Peace Officers Research Association of California and only one district attorney, from liberal Marin County on the other side of the Golden Gate Bridge.

In the event at Sacramento’s Sheraton Grand Hotel, the remarks of Schwarzenegger and others will, I’m told, focus on his policies, although references to Jessica’s Law and Phil Angelides are not unlikely.

Although Angelides supports the death penalty, he and his campaign are not making it difficult for Team Arnold to pigeonhole him as a classic liberal Democrat. Not only is his still vague program of closing corporate tax loopholes and tax hikes on the rich, not to mention past advocacy of a raft of broader tax increases, making it easy to type him as a tax-and-spend liberal, his lack of a profile on crime further outlines the picture.

Indeed, the issues page on the Democratic candidate’s web site remarkably makes no mention of Angelides’ views on criminal justice issues. His Republican foes need merely paint by numbers to fill in the blanks. It’s the sort of oversight one can get away with running for a down-ballot office, as the treasurer has three times in the past. But not running for governor, something he has planned for many years.

As Schwarzenegger pivots to “red meat” concerns for the base which are also popular with more moderate voters, we can expect to see more visuals of him with cops and other law enforcement figures. The former action superstar has told of his popularity with cops ever since his first Terminator movie in 1984, in which he first delivers his trademark line: “I’ll be back.” Which is intriguing, since he says the line in a police station, just before assaulting it and massacring every police officer in it.

But probably not a wave of such pictures. Unlike most politicians, the former Mr. Universe doesn’t have to do much to invoke a high-testosterone image. That’s why you may see more of him with the victims of crime, playing up his well-defined cinematic image as a protector. (By an odd coincidence, “Protecting The California Dream” is his re-election campaign slogan.)

In fact, Schwarzenegger is also this week, on the gubernatorial side of his operation, rolling out his new program for crime victims. Setting up a crime victims advocate in the Governor’s Office and pushing new rights for crime victims in a bill carried by Democratic Assemblywoman Nicole Parra of Bakersfield, ironically one of the legislators he unsuccessfully tried to unseat in November 2004.

** The California State Assembly passed the state budget, 54 to 23. Schwarzenegger will sign it on Friday.

** The California State Senate passed the state budget, 30 to 10. Five Republicans joined with the Democratic majority to pass the budget favored by Governor Arnold Schwarzenegger. Somewhat surprisingly, state Senator Abel Maldonado, a key Schwarzenegger ally, voted no. Maldonado, perhaps miffed that the governor did not do more to help him in his near-miss bid for the Republican nomination for state controller, declared that the budget “does not move California closer to fiscal responsibility.”

Now the state Assembly takes up the budget.

UPDATE: Arnold running mate Tom McClintock voted no on the governor’s budget. Come to think of it, I did not see him on the green bus. 

** 5 PM UPDATE: In a further sign that passage of the California state budget tonight is likely, Assembly Speaker Fabian Nunez and Assembly Republican Leader George Plescia will hold a joint press conference after the vote.

** 4:45 PM UPDATE: I’ll be updating tonight on the prospective passage of California’s state budget. The Senate is now scheduled to go into session at 7:30 PM.

** California’s $131 billion state budget, according to sources, looks set for passage tonight. Both houses of the Legislature will go into session some time around or after 7 PM.

** Governor Arnold Schwarzenegger will do a live video webcast at 2 PM today announcing a new crime victims’ advocate within his office and a proposed updating of California’s crime victims bill of rights.

2 PM UPDATE: Schwarzenegger is running late. The tentative start of the webcast is now 2:15 PM.

2:15 PM UPDATE: New ETA is 2:30 PM.

2:30 PM UPDATE: Live webcast cancelled due to technical problems. A recording will be available for viewing at 3:30 PM.

3 PM UPDATE: The updated version of California’s crime victims bill of rights will be authored by Assemblywoman Nicole Parra (D-Bakersfield). Parra was one of the legislators unsuccessfully targeted by Team Schwarzenegger 2.0 in the November 2004 general election.

Governor Arnold Schwarzenegger, opponent Phil Angelides, and Democratic legislative leaders all have one thing in common when it comes to California’s prison crisis. Each, in his way, avoids grappling with the central point of last week’s scathing federal court report on the state’s prison system. None of them, in their statements yesterday, engaged the question of who controls the prisons: The state or the union?

Schwarzenegger, in his speech to the California District Attorneys Association meeting in Newport Beach, did not address federal court special master John Hagar’s sensational charge that in eschewing his administration’s declared path of reform his chief of staff, Susan Kennedy, undermined the leadership of the state’s corrections department and in effect turned power over to the prison guards union, the California Correctional Peace Officers Association (CCPOA). Hagar said that after two years of the most productive reform in history, Schwarzenegger retreated under fire from CCPOA, which played a major role in defeating his special election initiative agenda last year and which has brandished the possibility of funding a massive advertising campaign against him this year. His Democratic challenger, Treasurer Angelides, tried to make hay out of the crisis by saying that it has occurred on Schwarzenegger’s watch, true as far as it goes.

But in the early 1990s, then state party chairman Angelides played a central role in aligning the Democratic Party with the feared guards union, which had played a major role in the narrow 1990 gubernatorial election victory of Republican Pete Wilson over Democrat Dianne Feinstein. When the Democrats regained the governorship in the late ‘90s under Gray Davis — with the help of a then record independent expenditure campaign on the Democratic candidate’s behalf by CCPOA — the union rose to even greater power over the prison system and benefited from one of the most lucrative public employee contracts ever struck, secretly negotiated by the Democratic governor’s office.

On balance, the governor had a good day, with agreement on a state budget likely to allow him to sign it into law before the constitutional deadline of July 1st. The deal was made possible — as reported here on June 22nd — by Schwarzenegger backing away from his plan to provide $23 million more in funding for county-run health care plans that take care of illegal immigrant children. This was the price of passage for legislative Republicans, who oppose such programs even though they are largely supported by local Republican elected officials.

But the prisons crisis is not going away. Fortunately for the governor, at least from a political standpoint, both major parties are culpable. Schwarzenegger called in his speech to the state’s county prosecutors for the construction of two new prisons — financed by special bonds requiring only a majority vote of the Legislature — to deal with the horribly overcrowded situation in the existing system, currently housing twice as many inmates as intended for the facilities. To aid in the easing of the overcrowding crisis, he also called for an unspecified number of community re-entry facilities to house prisoners on the verge of release, the moving of non-violent female prisoners into private correctional facilities closer to their communities to allow a female prison to become a male prison, and streamlining of state contracting procedures.

Democrats blocked Schwarzenegger’s drive earlier this year to include prison construction in his massive infrastructure bonds package, despite the prison overcrowding crisis. It’s unclear if they will support another version of this proposal now, although they may be more inclined to now with the deepening of the prison crisis.

Nothing Schwarzenegger has proposed is likely to conflict with the goals of the guards union, which will gain more members and hence more clout with the building of more prisons, as has happened throughout the big build-up of the state’s prisons over the past quarter-century.

While Assembly Speaker Fabian Nunez issued a measured statement about Schwarzenegger’s plan, which also did not mention the federal court report’s charges about Schwarzenegger allowing the guards union to regain power over the prison system, Senate President Pro Tem Don Perata did at least allude to the central issue by noting that “the governor has yet to appoint permanent people at the top of the Department of Corrections to institute reforms.”

Unlike the Democratic legislative leaders, the Democratic gubernatorial candidate was scathing in his criticism of Schwarzenegger. But Angelides, who has hedged on prison construction, did not offer much in the way of an alternative other than better managers, a thorough review of the situation and a top priority pledge of filling 3,000 empty jobs in the prisons. He did not say how he would pay for this. In any event, it would probably please the union.

The Democrats’ alliance at the statewide level with CCPOA goes back to the early 1990s and Angelides’ tenure as state party chairman. Alarmed by the union’s role in helping elect Republican Wilson to the governorship over Feinstein, then San Francisco’s mayor, chairman Angelides and his political director, Bob Mulholland — long a key operative for Angelides and now senior advisor in his gubernatorial campaign — set about the task of wooing the prison guards union. They began to forge close ties with then CCPOA boss Don Novey.

The guards union had emerged as an 800-pound gorilla in statewide politics and they felt that Democrats could not afford to have it as a permanent part of the Republican coalition.

By 1993, their efforts had already begun to pay off, with CCPOA officials expressing great interest in the gubernatorial candidacy of Democratic Treasurer Kathleen Brown. A Mulholland-arranged meeting did not go well, however, as Brown’s then campaign manager Teresa Vilmain somehow managed to leave Novey’s business card lying on the floor of the meeting place. CCPOA stuck with Wilson in 1994.

But the union had become a fixture at Democratic gatherings and by the mid-1990s was a regular “underwriter” of the party’s state conventions. In 1998, it was a difference-maker in Davis’s victory over Republican Attorney General Dan Lungren.

With the ascension of Davis, the union reached even greater heights of power. His 2003 recall — in which the union (whose 2002 convention featured an hours-long autograph-signing session with Arnold Schwarzenegger, to Mulholland’s dismay) remained neutral — ended that. And to the dismay of CCPOA, Schwarzenegger the friendly action movie star turned into a prison reformer. Until he stumbled badly and nearly destroyed his political career in last year’s special election, making him vulnerable as he sought re-election this year to just the sort of massive independent expenditure campaign for which the feared union has become known in elections up and down the state.

** AS REPORTED HERE FOUR DAYS AGO, $23 MILLION EXTRA FOR CHILDREN’S HEALTH CARE PROGRAMS INCLUDING ILLEGAL IMMIGRANT KIDS HAS BEEN REMOVED FROM CALIFORNIA’S BUDGET. This removed the biggest stumbling block to today’s resolution of the budget.

** THE CLEAN MONEY INITIATIVE SPONSORED BY THE CALIFORNIA NURSES ASSOCIATION HAS BEEN CERTIFIED FOR CALIFORNIA’S NOVEMBER BALLOT. The measure would provide public financing through a slight increase in the corporate tax rate, establish very strict contribution limits (including on so-called independent expenditure campaigns), ban fundraising from lobbyists, strengthen public disclosure requirements, and remove those who cheat the system from office, among a variety of provisions. It will be one of several very interesting initiatives on a very important November election ballot.

** POOCH’S HUMAN EVENT. Republican Chuck Poochigian’s campaign for state attorney general is sending this column around today. Written by John Gizzi, political editor of the conservative magazine Human Events, it was featured by our Republican friends at the Flash Report this AM. I thought that it seemed very familiar, however. And so it is.

For the June 26th column, which blasts former Governor Jerry Brown as a radical whacko, is essentially the same column published on May 8th, which blasts former Governor Jerry Brown as a radical whacko. The only significant difference is that the May 8th column refers to the presence of Poochigian strategist Ken Khachigian at lunch with the columnist and other Human Events writers discussing former Governor Jerry Brown and his radical whacko past.

I thought recycling was a lefty thing.

** COAST GUARDING. A few days after addressing the American Legion convention, Democratic gubernatorial nominee Phil Angelides has again launched his “Coast Guard” plan, which he released during his primary contest with Steve Westly. It looks pretty familiar, more funding for the Coastal Commission and marine protection (not Marine protection), a stringent eye on existing oil leases offshore. I’ll link to it again when I’m not on the blackberry. The new element appears to be its rhetorical linkage of Arnold Schwarzenegger to President Bush, Vice President Cheney, and Republican Congressman Richard Pombo, who wants to open up offshore drilling. Schwarzenegger is against that, of course, but he is a Republican.

UPDATE: And just like that, a release has arrived from Team Arnold, detailing the Democratic candidate’s history of accepting big contributions from developers in a sensitive coastal zone, and of Schwarzenegger’s thanks from the Sierra Club for opposing Pombo’s coastal moves, his increase of funding for the Coastal Commission, etc.

UPDATE: Now momentarily off the blackberry, here is a link to the treasurer’s Coast Guard plan.

** A PUFF OF WHITE SMOKE OVER THE CAPITOL DOME? The “Fab Four” legislative leaders of both parties in both houses have reached agreement on California’s state budget. No further details are currently available, other than a vote prior to the July 1st constitutional deadline.

** Out and about checking in via blackberry, the governor will call for a special legislative session to deal with the prison crisis. As it has bipartisan origins, he will call for bipartisan solutions.

UPDATE: I will have a full report on the politics and policy of this in tomorrow morning’s column.

** Governor Arnold Schwarzenegger will discuss crime and California’s prison crisis in an address this morning to the California District Attorneys Association in Newport Beach. The address, at 11 AM, will be carried live here via webcast.

When Democratic gubernatorial nominee Phil Angelides and his former rival, Controller Steve Westly, meet this week, it will be three weeks since their bitterly contested, down-to-the-wire primary race came to its conclusion. Now Westly is coming to Angelides’ aid as the challenger seeks to upend Governor Arnold Schwarzenegger.

According to sources, Angelides has some very specific ideas about how Westly can help his campaign. But Westly’s efforts to do so are complicated by a new pro-Schwarzenegger TV ad which humorously blasts Angelides by repeating some of Westly’s nearly successful primary attacks against him.

Westly and Angelides have not met since their hurriedly put together party unity event with the rest of the new Democratic ticket — absent Jerry Brown and Bill Lockyer — on June 7th in Los Angeles. Westly publicly pledged his support then, but the two will meet for the first time three weeks later.

The Angelides campaign is said to believe that the ex-eBay honcho can be helpful to the Democratic nominee in several specific ways beyond the usual party unity purposes, and the obvious question of moderate voters.

For one, he can help Angelides in the Central Valley. Westly swept the Central Valley in the primary. Angelides will need to hold Schwarzenegger’s margin of victory in the Central Valley down if he has to have a hope of winning in November.

For another, Westly can be helpful in Silicon Valley, which he also carried, both with voters and with the high tech industry of which he is a part.

For a third factor, Angelides wants Westly’s help with Asian-Americans, another emerging constituency carried by Westly. The controller’s wife, a Chinese immigrant-turned-successful-high tech executive in her own right, Anita Yu Westly, proved to be a rising star herself campaigning for her husband. Westly’s family story — their kids are learning Chinese, and he speaks Spanish, though “only 10 words of Chinese,” as he puts it — is seen by many as representing a hopeful future for California.

But there is a new complication for all this newfound harmony between Angelides and Westly, and that is the Schwarzenegger TV ad conceived and produced by his consultants and paid for by the California Republican Party. Steve Westly is the off-screen star.

The throughline of the new negative spot is that Angelides would move California backward, like the original official campaign ad version to which it is the successor. The new negative ad continues the visual motif of figures moving backwards. In the first ad, it began with a bird moving backwards, finally ending with Angelides himself walking backwards.

In the new version, all the visuals show Angelides walking backwards. And the message this time is not partially about tax increases, it is entirely about tax increases. And the messenger, whose identity the announcer teases until the end of the spot, is Angelides’ narrowly defeated Democratic primary rival, Controller Steve Westly.

Quoting him throughout, as “one person’s view of Phil Angelides” — the spot is called “Quote” — the ad assails Angelides for proposing $10 billion in tax increases. After a litany of tax hikes Angelides has proposed in recent years but says he is no longer for, with wry music playing throughout, the announcer coyly asks: “What if Steve Westly was right?”

That will be an interesting wrinkle for Westly and Angelides to deal with when they emerge from their meeting this week with a newfound political partnership for the general election.