Legislature slashes $1 billion from state budget
Matthew Yi, Chronicle Sacramento Bureau
Friday, February 15, 2008
"(02-15) 12:46 PST SACRAMENTO -- Sacramento - The state Legislature today approved nearly $1 billion worth of budget cuts and delayed payments for the current fiscal year as part of an effort to solve the state's fiscal crisis.
More than half of the cuts, an estimated $507 million, come from the education budget. However, classrooms and ongoing programs at public schools are expected to be untouched because unspent funds from the past two years, in programs such as after school child care and teacher training, will help cover any shortfalls.
Other mid-year cuts include delays in cost-of-living adjustments on some welfare payments, deferring appointment of judges and reducing spending of many state agencies.
The package of bills that both the Senate and the Assembly approved also includes $1.2 billion is savings for the next fiscal year, which begins July 1. A 10 percent decrease in Medi-Cal reimbursements make up the bulk of those cuts.
Aaron McClear, a spokesman for Gov. Arnold Schwarzenegger, said the governor will sign the bills as soon as feasible, which could be Saturday morning.
It was in January when Schwarzenegger announced the state would face a $14 billion deficit by July 1 and declared a fiscal emergency. That declaration required the governor to offer his solutions to the Legislature, and the lawmakers have 45 days to return bills to the governor's desk. That deadline is Feb. 24.
The only bill that failed get out of both houses of the Legislature was a measure that many lawmakers have billed as an attempt to close a tax loophole benefiting Californians' who own large vessels, especially yachts.
According to current state tax code, boat buyers could avoid paying sales tax if their new purchases were made out of state - even if that means a deal is sealed five miles off the California coast into international waters - and the vessel was kept out of California for 90 days.
The measure considered today by both houses would have increased the 90-day period to a year, making it more difficult for California yacht owners to avoid paying use taxes and raise as much as $5 million in additional revenue for the current fiscal year and $21 million for the following fiscal year.
While the Senate's version was approved with a required two-thirds vote in the upper house, the Assembly failed to clear that hurdle. However, the Senate version is expected to reappear in the Assembly next week."
Good luck brothers, I sure hope this doesn't include cuts in DMV staff!
jdog