State Analyst Faults Governor’s Proposed Spending Plan
On Wednesday the nonpartisan state legislative analyst projected that California's expected budget deficit had risen to $16 billion and released a spending plan as an alternative to one offered by Gov. Arnold Schwarzenegger (R), the Los Angeles Times reports.
Legislative Analyst Elizabeth Hill described Schwarzenegger's plan for a 10% across-the-board reduction in spending for state agencies as shortsighted and urged legislators to reject it.
With regard to Medi-Cal, Hill warned that a 10% cut to reimbursement rates would exacerbate the current doctor shortage and force patients to seek care in emergency departments, a move that would increase state costs elsewhere (Halper, Los Angeles Times, 2/21).
On Saturday Schwarzenegger signed legislation intended to save the state more than $500 million in Medi-Cal by reducing payments to health care providers. The lower reimbursement rates are scheduled to take effect July 1 (California Healthline, 2/19).
Hill's competing budget proposal was the first time the state analyst released a plan before lawmakers began to debate the budget. She said the plan was needed because Schwarzenegger failed to prioritize funding for public safety, health and welfare, and other core responsibilities of government (Davis, AP/San Diego Union-Tribune, 2/20).
Schwarzenegger's more controversial cuts and Hill's proposal to raise $2.7 billion in additional revenue by ending or reducing some tax credits are expected to fuel a legislative battle over the budget in the coming months, the San Francisco Chronicle reports (Yi, San Francisco Chronicle, 2/21). Schwarzenegger and Republican lawmakers remain opposed to tax increases (AP/San Diego Tribune, 2/20).
Assembly Speaker Fabian Núñez (D-Los Angeles) praised Hill's proposal and said, "You cannot balance the budget simply by cutting back services" (Lin, Sacramento Bee, 2/21).