Governor, Democratic Lawmakers Face Off on Budget Proposals
Gov. Arnold Schwarzenegger (R) and Senate and Assembly Democrats are butting heads over various proposals to address California's estimated $24 billion budget deficit, the Los Angeles Times reports.
During an interview with the Times' editorial board Wednesday, Schwarzenegger said it would be "irresponsible" to pursue the Senate Democrats' budget proposal, which calls for closing the budget gap by dipping into state reserves.
"We have not hit the bottom" of the economic downturn, the governor said (Goldmacher, Los Angeles Times, 6/11).
On Tuesday, Senate President Pro Tempore Darrell Steinberg (D-Sacramento) proposed a budget that would leave less than $1 billion in state reserves in an effort to preserve programs such as Healthy Families, the state's Children's Health Insurance Program.
Democrats also hope to preserve in-home support services for the elderly and HIV/AIDS programs.
Steinberg said legislators would be willing to pare down such programs, but not cut them entirely (California Healthline, 6/10).
No Short-Term Loans
Schwarzenegger also told the Times he would let California's government come to a "grinding halt" rather than approve a high-interest loan if lawmakers cannot decide on a budget plan in the coming weeks.Â
State officials estimate that California will run out of cash by the end of July unless a budget agreement is reached (Los Angeles Times, 6/11).
Assembly Democrats Speak Up
In the Assembly, Speaker Karen Bass (D-Los Angeles) did not comment on Steinberg's plan, but said Assembly Democrats would focus on looking for ways to raise new revenue.
Although sources say Bass and Steinberg continue to work together closely, differences in their budget approaches could reflect growing divisions among Democrats in the two houses, Capitol Weekly reports.
Senate Democrats support cutting some state services, while Assembly Democrats have resisted some of these proposals, including eliminating money for rural hospitals (York, Capitol Weekly, 6/11).
On Wednesday, Bass said that lawmakers "can't solve a deficit this big through cuts alone," adding that she would prefer a balanced approach that includes an equal amount of new revenue.
Bass did not elaborate on the options Assembly members are considering to raise revenue, but she said some could be implemented with a majority vote in the Legislature, meaning that they would constitute fees or other non-tax measures.
She also said the Assembly intends to reach a budget agreement by the end of June.
SEIU Calls for Tax Increases
On Wednesday, the Service Employees International Union launched a $1 million advertising campaign in favor of raising taxes to help address the deficit.
SEIU represents 700,000 Californians, including in-home health care workers and others who could lose state funding under the proposed budget cuts (Sanders, Sacramento Bee, 6/11).
Schwarzenegger's proposals to reduce state spending for Medi-Cal and Healthy Families will result in the loss of federal funds, meaning that "the governor's proposals are not just seemingly heartless, they are wholly counterproductive to any attempt to get us out of our economic distress," Anthony Wright, executive director of Health Access, writes in a San Francisco Chronicle opinion piece.Wright calls for the governor to revisit his earlier health care reform proposals and consider other ways to generate revenue, such as expanding the sales tax (Wright, San Francisco Chronicle, 6/11). 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.