California Senate OKs Budget Package; Health Care Cuts Sail Through
Early this morning, the California Senate approved a 31-bill budget package negotiated by Gov. Arnold Schwarzenegger (R) and top legislators from both parties, but several measures are still pending in the Assembly, the AP/Fresno Bee reports (Lin, AP/Fresno Bee, 7/24).
Voting began last night, and both chambers quickly approved a key measure that would severely reduce state spending for health programs, In-Home Supportive Services and other programs (Lin, AP/San Diego Union-Tribune, 7/23).
In total, the package would cut:
- $8.5 billion from education;
- $2 billion from health programs;
- $1.2 billion from social services; and
- $1.2 billion from state prisons.
The measure initially encountered some resistance in the Senate from Republicans who opposed the prison cuts and Democrats who protested the cuts to social services.
However, Senate President Pro Tempore Darrell Steinberg (D-Sacramento) pressured lawmakers until the bill passed in a 27-13 vote. Senators from both parties then approved several subsequent bills that will allow the spending cuts to take effect (Wiegand/Sanders, Sacramento Bee, 7/24).
Many of the measures under consideration require a two-thirds majority vote, meaning that the budget's approval will require support from at least some Republicans.
Long Road Ahead to Fiscal Stability
Even if the Legislature passes a balanced budget, California's plans to use short-term loans to cover its daily funding obligations depend on whether the plan is attractive to the bond markets.
Such loans will allow the state to eventually stop issuing IOUs. The state controller's office began sending IOUs at the beginning of the month in an attempt to conserve cash.
OpponentsÂ Rally Against Budget
AÂ wide range of interest groups and local government leaders urged lawmakers to reject certain elements of the plan.
Prior to Thursday's legislative session, several California mayors held a conference call denouncing a budget proposal to siphon funds from local governments.
The mayors said at least 130 local governments have agreed to sue the state in an effort to block the funding raids.
Health and welfare advocates also are protesting the cuts to social services programs (AP/San Diego Union-Tribune, 7/23).
In addition, Insurance Commissioner Steve Poizner (R) is considering a lawsuit to block the proposed sale of State Compensation Insurance Fund, California's quasi-public workers' compensation insurer of last resort (Marinucci/Yi, San Francisco Chronicle, 7/24).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.