Legislature Passes Budget Plan, Sends Package to Governor

On Friday morning, the Senate passed the main bill (SB 870) of an $87.5 billion spending plan, drawing an end to California's budget impasse on the 100th day of the state's fiscal year, the Sacramento Bee reports (Yamamura/Van Oot, Sacramento Bee, 10/8).

On Thursday evening, the Assembly passed SB 870 in a 54-1 vote, with seven Republicans joining Democrats to reach the two-thirds majority needed to approve a budget plan (Buchanan, San Francisco Chronicle, 10/8). The Assembly passed the final piece of the legislative package early Friday morning (Goldmacher et al., Los Angeles Times, 10/8).

According to those involved in budget negotiations, some of the voting delays stemmed from last-minute provisions proposed by lawmakers, which brought the total budget package to include 21 separate bills (Dolan/McGreevy, Los Angeles Times, 10/8).

The main budget bill now heads to Gov. Arnold Schwarzenegger (R), who is expected to sign it (AP/San Diego Union-Tribune, 10/8).

Budget Overview

The budget proposal aims to close California's $19 billion deficit partially by leveraging accounting strategies that would delay some payments until the next fiscal year.

The plan also assumes that the state will receive about $5.3 billion in federal funds that have yet to be promised (San Francisco Chronicle, 10/8).

Health Care Spending Details

The assumed federal funds include $1.3 billion in higher payments for Medi-Cal, California's Medicaid program.

The budget plan also would cut $937 million from health and human services programs. Proposed spending reductions include:

• $300 million from the In-Home Supportive Services program by imposing a 3.6% reduction in caregiver hours, leveraging federal funds and assuming lower caseloads;
• $187 million by enrolling elderly and disabled residents into managed care programs; and
• $84 million by freezing hospital Medi-Cal rates.

The proposal also aims to reduce prison health care spending by $820 million (California Healthline, 10/7).

Editorial

A Los Angeles Times editorial states that California's latest spending plan is "another kick-the-can budget that relies on gimmickry to paper over the state's structural problems." The editorial adds, "But at least it ends, for now, the game of chicken in Sacramento that was only making matters worse" (Los Angeles Times, 10/8).

Other Budget Coverage

Headlines and links to additional coverage of California's budget votes are provided below.

• "State Is Closer to Having a Budget" (Herdt, Ventura County Star, 10/7).
• "Assembly Passes Main Bill in California Budget Package" (Hindery/Thompson, AP/San Jose Mercury News, 10/7).
• "California Assembly Passes Main Budget Measure 99 Days Late" (Marois/Palmeri, Bloomberg Businessweek, 10/8).
• "Schwarzenegger and Legislators Reach Deal on Long-Delayed California Budget" (Nagourney, New York Times, 10/7).

Broadcast Coverage

Headlines and links to broadcast coverage of the budget vote are provided below.

• "Health Care, Education and the Budget" (Lieszkovszky/Sepulvado, "KXJZ News," Capital Public Radio, 10/7).
• "Tentative Pension Deal; Behind-the-Scenes Budget" (Myers, "California Report," KQED, 10/7).
• "California Lawmakers Offer Little Reaction to Budget Plan" (Small [1], "KPCC News," KPCC, 10/7).
• "Some Calif. Lawmakers Reject Budget for Lack of Transparency" (Small [2], "KPCC News," KPCC, 10/7).
• "California Budget Proposal Draws Faint Praise, Criticism" (Small [3], "KPCC News," KPCC, 10/7).