California Legisture passes austerity budget

16:49, June 29, 2011      

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California Legislature ended prolonged wrangling and passed an austerity budget Tuesday night that would enforce sweeping cuts, from education to funding for the poor.

The University of California and California State University systems face about a 23-percent funding cut, among the steepest in the proposal, according to The Los Angeles Times.

Other austerity measures proponed in the budget include:

-- Cash grants for the needy would fall;

-- A program to help thousands of teen mothers get an education would be suspended;

-- Hundreds of millions of dollars would be siphoned from mental health programs;

-- Courts would face what the state's chief justice has described as crippling reductions; and

-- Seventy public parks would close, the first-ever closures in the state's history.

"These cuts will forever haunt our conscience," said Democat Assemblyman Bob Blumenfield, who chairs the budget committee in the lower house. "However, those of us who do vote for this budget can take comfort with the knowledge that we did what was necessary to move ourselves toward stability."

In an optimistic forecast, lawmakers built in an extra 4 billion dollars of revenue. If all that cash does not materialize, K-12 schools (from kindergarten to 12 grades), which had so far survived negotiations relatively unscathed -- would face a cutback equal to shortening the academic year by seven days, The Times said.

By officials' own admission, the budget would not restore California's long-term financial health, the report said.

This is the second budget passed by the Legisture in as many weeks. Governor Jerry Brown vetoed the first but is expected to sign the new package before a fresh budget year begins Friday. His rejection of the Democrat majority's initial spending plan was the first veto of a budget on record in California.

"Democrats in the California State Legislature made tough choices and delivered an honest, balanced and on-time budget that contains painful cuts and brings government closer to the people through an historic realignment," Brown said soon after the second budget was passed.

"Putting our state on a sound and sustainable fiscal footing still requires much work, but we have now taken a huge step forward."

Brown lost his months-long bid to win enough Republican votes to extend temporary taxes that would have helped balance the books. Instead, he forged a deal with Democrats, who do not have enough votes on their own to raise taxes.

As a result, temporary sales and vehicle tax hikes enacted in 2009 will officially come off the books Friday.

Republicans cheered the impending tax decline but said the latest budget would push the state's financial problems into the future. They also criticized the package for failing to address the state's runaway pension costs or ease regulations they say are a drag on the California economy.

"It does not solve our problem in the long run," Republican Assemblyman Jim Nielsen said. "There are no sustaining reforms that are critical."

Though Republicans had balked at raising taxes, Democrats did push through some new charges without GOP support. Goods purchases by Californians from online stores such as would now be subject to state sales taxes. Living in wildfire zones where the state provides firefighters would cost homeowners about 150 dollars annually. And yearly car registration fees would rise by 12 dollars.

Those levies, however, would raise only 550 million dollars, a fraction of California's remaining 10-billion-dollar deficit. An accounting move - delaying payment of nearly three billion in school monies - would fill much of the shortfall, at least temporarily, The Times said.

Democrats would wipe away the biggest portion of the deficit with the extra 4 billion dollars their budget assumes will come in. Without that money, even deeper cuts would be triggered automatically. The first reductions would be to universities, libraries, prisons and services for the needy and disabled. Community college fees would bump up another 10 dollars per unit, the report said.

If less than half of the 4 billion dollars materializes, school districts could shorten the instructional year by up to seven days or find other ways to save 1.5 billion, and state-provided school buses would be mothballed, saving 248 million, according to The Times.

Source: Xinhua
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