California meltdown

A biweekly flyover of the state budget crisis

It’s a waiting game in Sacramento. Lawmakers, who have failed to make much of a dent in the $20 billion budget shortfall, are waiting for Gov. Schwarzenegger’s May revised budget. And the governator is still waiting to hear from the feds on whether they will bail out the state. (Good luck, Ahnold.) In the meantime:

Weds., March 24: A new Field Poll reports that more than two-thirds of Californians oppose budget cuts to health care and public-assistance programs for the low-income elderly, blind and disabled. Of 14 areas of state spending covered in the pool, a majority of voters supports cutbacks in only state parks and prisons.

Mon., March 29: The Sacramento Business Journal reports that Gov. Schwarzenegger’s proposed $6.4 billion cut to health- and human-services programs will lead to the loss of 42,000 jobs in California, according to a report by consumer group Health Access. In addition, the governor’s proposal to eliminate the In-Home Supportive Services program would result in the elimination of more than 370,000 home-care jobs.

Mon., March 29: New American Media, an ethnic-media news service, reports that passage of national health-insurance reform could make it more difficult for the governor to implement proposed cuts to programs such as Medi-Cal and Healthy Families. That’s because the health-reform legislation includes a “maintenance of effort” provision requiring states to maintain their current programs. To do otherwise could result in the loss of billions of dollars in federal payments.

Mon., April 5: Stanford University issues a report that three major state pension funds are underfunded by more than $500 billion. The study, commissioned by Gov. Schwarzenegger, was prepared by grad students at the Stanford Institute for Economic Policy Research. In a statement, the governor said the study “reinforced the immediate need to address our staggering pension debt.”

Tues., April 6: Los Angeles Mayor Antonio Villaraigosa asks the city administrator to shut down all city agencies—except for public safety and those that generate revenue—two days per week. The action comes on the heels of the city controller’s warning that the city might soon be unable to pay employees and vendors. Villaraigosa is at odds with the City Council, which has rejected an electricity-rate increase, leading the Department of Water and Power to withhold a promised $73.5-million payment to the city.

Thurs., April 8: State Controller John Chiang reports that March receipts rose above the governor’s 2010-11 budget estimates by $356 million, or 5.9 percent. At the same time, disbursements were down by $450 million. Year-to-date budget revenues are ahead of budget estimates by $2.3 billion, or 4.1 percent.

Fri., April 9: The Los Angeles Times reports that, according to Legislative Analyst Mac Taylor, not all of the increased state revenues will go to offsetting the deficit. As much as 60 percent of the money will go to K-12 education, under terms of Proposition 98 and prior agreements.

Tues., April 12: Capitol Alert reports on a poll released by California Forward, a bipartisan government-reform coalition, indicating that 59 percent of voters favor lowering the requirement for passing a state budget from two-thirds to a simple majority, as long as the two-thirds requirement remains for tax increases.