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Analyst projects massive state budget shortfalls

The nonpartisan state Legislative Analyst’s Office, in a report issued today, issued a bleak outlook for the state budget with projections of a $27.8 billion shortfall in the next 20 months.

This will almost certainly test the mettle of the California Legislature and Gov. Arnold Schwarzenegger in the coming months as they struggle to find a way through this economic mess.

Click here to watch LAO analyst Mac Taylor’s comments.

Here’s what the LAO said:

“We concur with the administration’s assessment that the state’s struggling economy signals a major reduction in expected revenues. Combined with rising state expenses, we project that the state will need $27.8 billion in budget solutions over the next 20 months. The state’s revenue collapse is so dramatic and the underlying economic factors are so weak that we forecast huge budget shortfalls through 2013­14 absent corrective action. From 2010­11 through 2013­14, we project annual shortfalls that are consistently in the range of $22 billion.”

Click on this link for the full report:

Posted on Tuesday, November 11th, 2008
Under: California budget, Legislation | No Comments »

Houston offers state budget stance

Assemblyman Guy Houston, R-San Ramon

Assemblyman Guy Houston, R-San Ramon

Assemblyman Guy Houston, R-San Ramon, sent over his favorable opinion (see it below) on the draft state budget that lawmakers passed earlier this week after months of delays and bickering.

Houston may be the last remaining Republican in a partisan seat in the Bay Area, but his view runs counter to that of GOP Gov. Arnold Schwarzenegger.

The governor has said he will veto the budget in an unprecedented move, calling its reforms inadequate to deal with the state’s long-term deficit. The Democrat-controlled Legislature vows to override the veto. And the governor says if that happens, he will veto all those bills still sitting on his desk.


Here’s what Houston wrote:

Why We Did Not Raise Taxes and Why That is the Right Thing for California

Why would raising taxes be the short-sighted, ill-conceived way to close our state’s budget deficit? – because you already pay too much!

The Legislature finally passed a budget at 3 AM on September 16th, although Governor Arnold Schwarzenegger promises to veto it. The compromise budget did not include any new taxes or tax increases, instead responsibly relying on $9.6 Billion in spending cuts.

When I was elected to the State Assembly in 2002, the 2003-04 budget included $71 billion dollars in General Fund spending.  As I wrap up my last year in the Assembly, the 2007-08 budget grew to $103 billion-a 31 % increase in just six years. Read the rest of this entry »

Posted on Wednesday, September 17th, 2008
Under: California budget, California Legislature, Schwarzenegger | No Comments »

League of Cities condemns recall move

The California League of Cities just issued a statement calling the CCPOA’s (state prison guard union) move to recall Gov. Arnold Schwarzenegger a “gross abuse” of the state’s initiative process.

Read more to see the full release. Read the rest of this entry »

Posted on Tuesday, September 9th, 2008
Under: California budget, Schwarzenegger | No Comments »

Governor: No budget, no bills

Gov. Arnold Schwarzenegger today vowed to veto all legislation that crosses his desk prior to receiving an acceptable budget from state lawmakers.

Hey, unlike that pesky plan to cut state workers’ salaries, which will take six months to reprogram the payroll computer system, the governor holds the power over his own pen.

Click here to read the governor’s comments or watch the press conference on video.

Assembly Speaker Karen Bass had this to say about it: “Like the governor, we want to reach agreement on a budget that’s responsible and balanced, and 110 percent of our focus is on that. The Governor’s action today is yet another distraction that won’t have much impact other than the possible veto of public policy that moves our state forward.”

Posted on Wednesday, August 6th, 2008
Under: California budget, California Legislature, Schwarzenegger | No Comments »

State budget stalemate persists

California legislators with plans to go to the national presidential nomination conventions may want to check out the cancellation policy on their airline tickets.

Senate President Pro Tem Don Perata warned in a statement to reporters in Sacramento today that there’s no reason to believe the budget impasse will end in time for members to jet off to Denver for the Democratic Party’s convention on Aug. 25.

“I have told everybody that if they want to spend one weekend or the other in Denver, go right ahead, but don’t plan to be there for the (Democratic National) Convention,” Perata said. “I don’t see this ending for quite some time.”

It sounds grim. Read more for the full release. Read the rest of this entry »

Posted on Tuesday, August 5th, 2008
Under: California budget, California Legislature, Political conventions | No Comments »

Contra Costa launches “Stop the Cuts” tour

Contra Costa area health and human services advocates plan a two-day “Stop the Cuts” tour on Thursday and Friday intended to illuminate the impacts of proposed cuts in the as-yet-approved state budget.

It’s yet another sign of frustration in California as state lawmakers remain deadlocked in Sacramento over how to jump the financial equivalent of the Grand Canyon with a bicycle.

The van starts at the Food Bank in Concord at 9:30 a.m. Thursday, and over the course of two days, advocates with Health Access will visit a rape crisis center in San Pablo, an adult daycare center in Pleasant Hill and a childcare center in Antioch.

The group has invited a number of elected officials to join them including county supervisors and local mayors.

But the advocates specifically target Assemblyman Guy Houston, R-San Ramon, in their tour announcement, calling on the sole Bay Area Republican lawmaker to see for himself the impacts of the governor’s proposed cuts. For example, Health Access estimates that 900 Contra Costa seniors and people with disabilities will lose the financial support they need to stay in their homes.

Democrats and Republicans are stymied in Sacramento over how to close a $15 billion deficit in the next fiscal year budget, which actually started July 1.

Democrats favor tax increases combined with cuts, while Republicans vow to fight tax hikes. Adding to the political pressure cooker, Gov. Arnold Schwarzenegger has vowed to cut to minimum wage the salaries of 200,000 state workers beginning Thursday as the state runs out money to pay its bills.

Lawmakers will eventually cut a deal — we hope — but most of their options are bad and the outcome is likely to please no one.

Click here to read the full press release and view the tour schedule.

Posted on Wednesday, July 30th, 2008
Under: California budget, California Legislature | No Comments »

Public gives governor and legislators the gong


The new Field Poll out today gives poor marks to Gov. Arnold Schwarzenegger and the Legislature, according to a story by Mike Zapler in the Mercury News:

SACRAMENTO – Only two in five voters give Gov. Arnold Schwarzenegger positive marks for his job performance, a sharp decline from his ratings late last year but virtually unchanged from a month ago, according to a California Field Poll.

The state Legislature is viewed favorably by just over one in four voters, and only one in five believe the state is heading in the right direction – half the number who said the state was on the right track six months ago.

And while two-thirds of respondents view the state budget deficit as serious, they aren’t very confident in the ability of the governor and Legislature to resolve it, the poll showed. Only 14 percent said they have a “great deal” of confidence in Schwarzenegger to “do what is right” to fix the budget; the corresponding figure for the Legislature was 4 percent.

Did we really need a poll to tell us this?

There’s no budget and the prospects for a budget include tax hikes, cuts in our schools and other services or maybe both. Everyone in Sacramento points the finger of blame at someone else but the public has its (index) finger aimed in the right direction.

I like the governor’s idea: Lock up the lawmakers in a room and don’t let them out until they come up with a budget that not only addresses this year’s problems but the ongoing structural deficit. If nothing else, it will cut down on all those useless press conferences where they puff out their chests and send verbal bombs across the aisle.

Posted on Wednesday, July 23rd, 2008
Under: California budget, California Legislature, Schwarzenegger | No Comments »

Lone Bay Area Republican opposes Dem’s tax plan

Assemblyman Guy Houston of San Ramon, the only Bay Area Republican in the state Legislature, issued a statement late last night outlining his opposition to the Democratic leadership’s proposal to boost taxes to help solve the state’s yawning budget deficit.

Click here to read Houston’s press release.

“California already has one of the highest tax rates in the nation and now the Democrats want to make them even higher,” Houston said in his release. “We must leave within our means. A budget deficit that is the result of the irresponsible pace of our government’s growth should not be balanced on the backs of the hardworking Californians.”

Houston’s position is consistent with his Republican colleagues who view the proposed $9.7 billion in tax hikes on the state’s most wealthy residents as untenable and unlikely to materialize in the current weakened economy. (Of course, Republicans oppose tax hikes in a strong economy, too.)

Click here to read the Democrat’s budget proposal on Senate President Pro Tem Don Perata’s web site.

California is one of a handful of states that require a two-thirds vote to approve a budget and raise taxes, which gives Republicans considerable veto power despite their minority status in Sacramento.

That means the stalemate could drag out for weeks or months as legislators haggle over how to solve the state’s $15.7 billion budget deficit. Both sides are firmly dug into their positions but that could change in September when the state runs out of money to pay its bills and starts issuing IOUs. Yeah, the grocery stores love those state IOUs.

Read more for Houston’s full press release. Read the rest of this entry »

Posted on Thursday, July 10th, 2008
Under: California budget, California Legislature | No Comments »

Legislative leaders hold budget press conference

Democratic leaders in the California Legislature are holding a press conference at this moment to talk to reporters about their proposal to raise taxes to help close the state’s $15 billion budget deficit. I’ve posted below the press release from state Sen. President Pro Tem Don Perata and Assembly Speaker Karen Bass.

Republicans oppose these increases, which dooms the proposal to failure on the floors of both the Senate and the Assembly. California requires a two-thirds vote of the Legislature to pass a budget and raise taxes.

But state lawmakers are under heavy pressure to find a compromise soon. The state’s budget year ended June 30 and it will run out of money to pay its bills in September.

Read more for the details of the proposal outlined in the press release. Read the rest of this entry »

Posted on Wednesday, July 9th, 2008
Under: California budget | No Comments »

DeSaulnier-Bonilla host forum on healthcare cuts

PER DESAULNIER’S OFFICE: Due to a a failure in the air conditioning of the facility, this evening’s town hall has been postponed. The media and community will be notified when a new date and facility have been secured.

Assemblyman Mark DeSaulnier, D-Concord, and Contra Costa County Supervisor Susan Bonilla of Concord will host a community meeting Wednesday on proposed budget cuts to healthcare programs such as Medi-Cal.

The meeting is open to the public and will be held from 7-9 p.m. at the offices of Lutheran Social Services of California, 988 Oak Grove Road in Concord.

For more information, click here.

Posted on Tuesday, July 8th, 2008
Under: California budget, California Legislature, Contra Costa County | No Comments »