New state budget plan may carry hard choicesMatthew Yi, Chronicle Sacramento Bureau
Monday, May 12, 2008
Sacramento -- With the state's fiscal crisis worsening, there will likely be no good news when Gov. Arnold Schwarzenegger unveils a revised version of his budget proposal on Wednesday.
Schwarzenegger warned last month that California's looming budget deficit could be as high as $20 billion, a staggering figure that represents about one-fifth of the state's annual general-fund spending.
Efforts to close the gap are expected to result in cutting popular programs as well as generating more revenues by increasing taxes or fees. And with budget negotiations likely to drag on through the summer, this story probably won't have a happy ending for the actor-turned-governor or the 38 million Californians, experts say.
"If this was a Schwarzenegger movie, there would be some secret weapon or escape hatch, but unfortunately this is Schwarzenegger reality, not a movie," said John Pitney Jr., a political science professor at Claremont McKenna College. "He's going to lose political capital no matter what he does."
The governor already has been on a losing streak. He trumpeted 2007 as the year of health care reform, but a plan that he brokered with Assembly Speaker Fabian Núñez, D-Los Angeles, failed to gain approval by a Senate committee.
Schwarzenegger declared 2008 would be the year of education, but with state's revenues tanking, the governor has proposed cutting nearly $5 billion in K-12 and higher education for the new fiscal year that begins July 1.
More recently, the governor has been criticized on many fronts after his budget proposal in January included across-the-board cuts that would result in suspending the state's education funding obligations, closing state parks and releasing early tens of thousands prisoners.
Drastic measuresSchwarzenegger, who says he doesn't want to raise taxes, said such drastic measures would be necessary to close what he estimated in January would be a $14.5 billion budget deficit by July 1. By February, nonpartisan Legislative Analyst Elizabeth Hill said the gap would grow to $16 billion, blaming the continuing fallout from the housing market meltdown. ......(more)
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