Assembly speaker: Sides closer in budget talks
SACRAMENTO, Calif. — California Assembly Speaker Karen Bass says lawmakers and the governor are just several hundred million dollars apart on finalizing a $90 billion-plus state spending plan.
Bass made the comments Wednesday before the start of a planned negotiating session.
She says a decision had not yet been made on the size of the reserve fund.
Earlier in the day, Gov. Arnold Schwarzenegger said a deal could be reached by the end of the day on closing the $26.3 billion budget deficit
THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP’s earlier story is below.
SACRAMENTO, Calif. (AP) — Gov. Arnold Schwarzenegger said Wednesday he and top lawmakers could have a deal by the end of the day to close California’s $26.3 billion budget shortfall. But he also cautioned that difficult decisions remain.
The depth of cuts to social service programs and education are among the issues the governor and legislative leaders will discuss when they resume negotiations in the afternoon.
“I think that we have a good shot of getting the budget done today,” Schwarzenegger told reporters during a Capitol news conference. “But I just have to caution there’s no, there’s still very important things that have to be resolved.”
To save cash, California has been forced to issue IOUs to thousands of state vendors, and Schwarzenegger has ordered state workers to take three days off a month without pay. The state’s credit rating has been sinking steadily as the negotiations over balancing the budget drag on.
On Tuesday, Moody’s Investor Services downgraded California bonds to near-junk status, from A2 to Baa1, and placed the state’s credit rating on watch for possible further reductions. The credit rating agency said the budget deadlock had put constitutionally required payments to bond holders at risk.
The administration also notified state employee unions that the state would cut 2,000 jobs on top of 4,600 layoff notices issued previously.
Schwarzenegger said he wants to avoid a budget-balancing plan that addresses only the state’s current fiscal problems. Rather, he wants to begin tackling the state’s structural problems by streamlining government and weeding out waste, fraud and abuse.
His campaign committee this week launched a statewide 60-second television commercial with the governor saying he would stand firm against tax increases.
He agreed to increase sales, personal income and vehicle-license taxes earlier this year, and has proposed a surcharge on homeowners’ insurance policies to help pay for emergency services. The surcharge would cost the average homeowner $48 a year.
Schwarzenegger’s ad prompted the California Democratic Party to file a complaint with the state Fair Political Practices Commission, saying it violated a new state regulation that limits ads to ballot measures or potential ballot measures.
The commission is reviewing the complaint.
Meanwhile, advocates for social services were protesting against cuts and proposed reforms outside the Capitol. They pleaded with the governor to spare programs they say are vital to seniors, low-income families and the disabled.
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