On The Money: Brown Cancels Building Sale

By Mike Luery

SACRAMENTO (CBS13) -- Governor Jerry Brown has canceled the controversial sale of eleven state properties – many of them Sacramento landmarks. The move saves money for taxpayers – and jobs for state workers.

The deal was pushed forward by former Governor Arnold Schwarzenegger, despite a report from the non-partisan Legislative Analyst's Office calling it "poor fiscal policy."

The tentative sale late last year prompted the state to send out letters to 1,400 state workers, telling them they could lose their jobs if the sale of the buildings were completed (see exhibits C and D in this complaint).

Paul Bradley, a custodian with the Department of General Services, received one of those letters. He works at the Franchise Tax Board complex – one of the properties slated to be sold – so he could have been out of a job in 120 days.

"It's gut wrenching," Bradley told CBS 13. "I'm a veteran. And I put in 10 years with the state."

But now Paul Bradley says he's on "Cloud Nine" after learning Governor Brown pulled the plug on the deal – saving his job, along with other custodians who work at 24 buildings across the state – including the Attorney General building, the Department of Justice complex and the East End complex in Sacramento.

Governor Brown declared today, "Selling state buildings is the ultimate kicking the can down the road."

Brown said the deal just didn't make sense for taxpayers, who would end up shelling out $6 billion more over 35 years by renting back two dozen buildings the state now owns.

But in canceling the sale, it erases $1.2 billion already penciled in to this year's budget. Governor Brown says he'll bridge the gap from savings in Medi-Cal and prison construction. But he also mentioned $830 million in loans.

"We're borrowing from internal funds," Brown said today.

He added, "We're paying that back because we will generate a surplus in three years if all the budget solutions are adopted as I've proposed."

Brown says it's better to pay $18 million in interest over 3 years, compared to $6 billion for a bad deal over 35 years. As for Paul Bradley, he told CBS 13 he's just glad to be keeping his job.

"It would be very difficult for me to leave," said Bradley.

Saving union jobs and taxpayer dollars amounts to a political win win for Governor Brown – who must now close an even bigger deal – involving California's $25 billion budget deficit.