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California once again be seen in the sofa cushions and cover each sector of the state government to find another 20.7 billion U.S. dollars to balance its budget over the next 19 months.
This time, however, state leaders will not be able to reap the savings of some categories of spending more largest in the state.
California can not play most of the financing of K-12 schools or universities, because the state is spending nearly a minimum required by the federal government. The state can not reduce Medi-Cal through January 2011 for the same reason. These programs 84.6 billion U.S. dollars represent over half of state general fund budget.
"We can reduce these areas much more, so it closes a very large chunk of its budget," said Analyst Nonpartisan Legislative Mac Taylor, who published his deficit projection of 20.7 billion U.S. dollars on Wednesday.
The news brings relief to groups education, but puts more pressure on other programs without spending federal requirements. State leaders will not carry out further cuts in prisons, state parks and social service programs associated with the requirements of federal expenditures or funds.
The Legislative Analyst's report is Three of the rule of furloughs workers month ended in June. But Gov. Arnold Schwarzenegger may try to expand further, pending the outcome of court challenges.
Another objective could be healthy families, children from low-cost health insurance program. Schwarzenegger a once proposed the elimination of Healthy Families and not cut off funding this summer, although he and lawmakers restored coverage of 600,000 low and middle income children in September.
"I think we have exhausted the cuts that do not shock the conscience," said Anthony Wright, executive director of Health Access California. "We to look to other solutions, including raising taxes and revenues, because the cuts that remain are unforgivable, including the denial of coverage of children .
California faces a deficit again, partly because lawmakers and Schwarzenegger was based on several risk solutions in the budget agreements earlier this year.
These include a partial sale of $ 1 billion of the Insurance Compensation Fund of the State, now under appeal by Insurance Commissioner Steve Poizner. It also includes $ 800 million in money that traffic courts said the state could not use for general purposes.
The $ 20.7 billion gap could grow even more if the courts throw out a change of 1.7 billion U.S. dollars of redevelopment funds facing to review or consider illegal exit visas.
Another reason for the looming deficit is that legislators are based on time savings, as postponing paychecks of state employees by June 30 to July 1. State leaders likely that similar solutions to help to solve the following gap.
Taylor recommended Wednesday that state lawmakers move quickly and to consider not only cuts, but no source of revenue possible. He specifically warned against increasing tax rates, which could further accentuate the economy.
Taylor suggested that the State could consider ending tax breaks for certain businesses, stating that all multi-state companies use the same method to calculate their California taxes or the elimination of enterprise zones that offer tax credits to employers in specified areas. He said that the benefits of this program latter are questionable.
However, Michael Shaw, California legislative director with the National Federation of Independent Business, said reducing the incentives commercial harm the state's economic recovery.
"Additional tax increases will have more money of Californians and the owners small business in particular, "he said." Maybe it would prolong our economic slowdown at worst lead to job losses in the long term .
The Democrats could re-examine the ideas of last year as a tax on oil production in California. Schwarzenegger, may apply again to allow oil drilling off the coast of Santa Barbara in exchange for royalties.
But after the signing of several temporary tax hikes in February, the governor said Wednesday in Milan, Italy, you do not want to consider any new tax increases, according to Dow Jones Newswires.
"I think it's important not to increase revenue, not to raise taxes," he said. "We have to live within our means."
Taylor recommended that the state lobbying for a new round of federal aid to help connect its budget gap.
He also suggested lawmakers could Back to vote to take tax money now devoted to mental health services, five childhood development and after school programs.
The measures voters rejected in May, reportedly received money from the first two.
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