Assembly Panel OKs Budget Plan That Restores Health Care Cuts
Yesterday, the Assembly Budget Committee approved a state budget proposal that would increase taxes by $9.7 billion and avoid $1.5 billion in cuts to health and welfare programs proposed by Gov. Arnold Schwarzenegger (R), the San Diego Union-Tribune reports.
The committee's plan exceeds Schwarzenegger's proposal for $102 billion in general fund spending for fiscal year 2008-2009 by about $4 billion (Mendel, San Diego Union-Tribune, 7/9).
Republican lawmakers have vowed to fight the Democrats' proposed tax increases. Support from Republican lawmakers is needed to attain the two-thirds majority needed to pass the budget to the governor.
Unlike Schwarzenegger's proposal, Democrats say that their plan would avoid large reductions in Medi-Cal funding for low-income residents. Medi-Cal is California's Medicaid program.
However, critics of the proposed tax increases said wealthy Californians already have seen a substantial tax hike from Proposition 63 in 2004, which increased the state income tax by 1% for Californians whose incomes exceed $1 million. Money from Proposition 63 funds mental health services (Halper, Los Angeles Times, 7/9).
State Controller John Chiang (D) and Treasurer Bill Lockyer (D) said several times that the state will face a cash shortage if lawmakers do not approve a budget by August (Lin/Smith, Sacramento Bee, 7/9).