Schwarzenegger Calls for Special Session To Address Budget Gap
On Thursday, Gov. Arnold Schwarzenegger (R) said he would convene a special legislative session in an effort to close the current fiscal year's deficit during his last month in office, the Sacramento Bee reports.
Schwarzenegger's announcement came one day after the Legislative Analyst's Office released a report estimating that the state faces a $6.1 billion shortfall for the current fiscal year. The report projected that the gap could grow to $25.4 billion by June 30, 2012 (Van Oot, Sacramento Bee, 11/12).
The special sessionÂ is slated toÂ begin on Dec. 6, the swearing-in date for new members of the Legislature. A spokesperson for Schwarzenegger said the session aims to address at least the current budget gap (Goldmacher, Los Angeles Times, 11/12).
Reasons for Current Deficit
According to Legislative Analyst Mac Taylor, the state's recently passed spending plan contained overly optimistic assumptions about cost shifts and revenue.
He said the state is unlikely to receive about $3.5 billion in anticipated federal funds (Williams, AP/Contra Costa Times, 11/11). The assumed federal funds include $1.3 billion in higher payments for Medi-Cal, California's Medicaid program (California Healthline, 11/11).
In addition, Taylor said the budget package assumed the state could reduce spending by nearly $800 million on prison medical care and roughly $400 million on Medi-Cal. He said the expected savings are unlikely to materialize because of delays in passing the budget and cost constraints (AP/Contra Costa Times, 11/11).
Expectations for Budget Plan
Schwarzenegger said he plans to introduce legislation to address the current deficit on the same day that the special session begins (Buchanan, San Francisco Chronicle, 11/12).
The governor's plan likely will rely on deeper spending cuts than the ones he proposed earlier this year (Sacramento Bee, 11/12). The plan will not include tax increases, according to a spokesperson for the governor (Los Angeles Times, 11/12).
Democratic legislators might reject Schwarzenegger's budget efforts and opt insteadÂ to negotiate with Gov.-elect Jerry Brown (D) when he takes office in January, according to the San Francisco Chronicle.
Brown plans to return to Sacramento on Tuesday to meet with lawmakers and other officials about the budget deficit (San Francisco Chronicle, 11/12).
Headlines and links to broadcast coverage on plans to address the new budget gap are provided below.
- "Governor Will Call Special Session in December" (Lieszkovszky, "KXJZ News," Capital Public Radio, 11/11).
- "California's Broken Record Plays On: 2011's Projected $25.4 Billion Deficit" (Morrison, "Patt Morrison," KPCC, 11/11).
Editorials on California's new deficit projections and Schwarzenegger's plans for a special budget session are provided below.
- "Fixes Are Clear for U.S. and State Budget Messes" (Los Angeles Times, 11/12).
- "State Budget Trauma, Again" (North County Times, 11/12).
- "Lame Duck Session Likely To Be Futile" (Sacramento Bee, 11/12).
- "Brown's Budget Dilemma: One Bold Remedy" (San Diego Union-Tribune, 11/12).
- "As We See It: Beating the Budget Blues" (Santa Cruz Sentinel, 11/12).