CA: Davis proposes $10 billion in budget cuts

Sac Bee ^ | 12/6/02 | AP - Sacramento

[NormsRevenge]

Gov. Gray Davis proposed $10.2 billion in sweeping budget cuts Friday, including deep spending reductions to education, health and welfare programs and state worker layoffs over the next 18 months.

The $10.2 billion includes $3.4 billion in midyear cuts, transfers and borrowing to this year's budget, and about $6.7 billion in savings in the fiscal year starting in July 2003, all to help deal with a budget shortfall expected to exceed $21 billion.

[NormsRevenge]

Davis, a Democrat, has faced budget woes for nearly two years, however until now he has largely spared education, his pet priority, from the ax.

And here we thought fund-raising was his pet priority.

[NormsRevenge]

Ping

[Inspectorette]

Education is Doofus' priority as long as it's not the Three R's. It's his priority if it's bilingual ed, self-esteem classes, multicultural claptrap, etc.

[lexington minuteman 1775]

Boy, I bet Californians are glad they re-elected this guy, huh? BWHAHAHAHAHAHA!

[Cicero]

It remains to be seen whether these cuts will be real. Knowing Davis, I wouldn't assume so. Even in this initial announcement, the brunt of it will be postponed until next year. Meantime the crisis will presumably get worse, since more borrowing and higher debt-support payments will be necessary.

[Drango]

It remains to be seen whether these cuts will be real.

Real? Heck, the so called "cuts" will give smoke and mirrors a bad name.

[mdittmar]

and possibly tax increases

possibly?,that's a good one.

[folklore]

Looks like ambrose and willie green are going to be busy. LOL!

[NormsRevenge]

Davis says following as preface to budget proposal numbers in pdf document file that you can view at Mid-year spending reduction proposals

You need Adobe Acrobat reader to view this pdf file


++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
OVERVIEW The anticipated recovery of the U.S. and California economies has not yet materialized. The Department of Finance’s 2002-03 May Revision economic forecast, on which the current-year budget is based, was more conservative than the consensus of economic forecasts at the time, projecting very slow growth in 2002.

Since the May Revision, the nation has added only 194,000 jobs. Over the last 10 years, the nation would have been expected to add about 200,000 jobs in a single month. Similarly, California has added only 30,000 jobs, about a month and a half’s worth of average job growth.

The national unemployment rate has hovered between 5.6 percent and 6.0 percent since the May Revision, compared to California’s unemployment rate of 6.4 or 6.5 percent every month since the May Revision.

Most troubling, the state’s important high-tech sector does not appear to have begun to recover. While job losses have slowed considerably in the state’s high-tech sector --- from a peak number of 19,200 jobs lost in April 2001 --- they remain a considerable drag on the economy, exceeding 4,000 jobs lost per month, on average, in the most recent four months.

Additionally, the stock market has lost a considerable amount of ground since midyear. When the Department of Finance’s May Revision forecast was finalized, the S&P 500 Index closed at 1128.37. By the end of November 2002, the S&P 500 Index had fallen 17 percent to 936.31.

The continued slide of the stock market in the summer and early fall and the possibility of military action in Iraq have soured the mood of consumers. As a consequence of these developments, State General Fund is projected to fall considerably below budgeted levels, necessitating prompt action to curb current-year General Fund spending.

On November 26, 2002, the Governor issued Executive Order D-64-02, directing departments to freeze spending where possible and to begin implementing current-year reductions in non-essential functions.

This document proposes a number of current-year General Fund spending reductions and other adjustments totaling $3.4 billion. These reductions and adjustments would result in additional budget year savings of $6.8 billion, for a total of $10.2 billion over the two years.

Of this amount, State operations reductions total $320.8 million for 2002-03 and $1.6 billion for 2003-04, consistent with the direction pursuant to Control Section 3.90 of the 2002 Budget Act (as added by Chapter 1023, Statutes of 2002) to achieve up to $750 million in State operations savings in 2002-03.

While the exact magnitude of the budget gap is still unknown, the Administration will present a balanced plan to address the full extent of the shortfall in the Governor’s 2003-04 Budget to be released in January.

Along with over 40 other states, California faces painful choices in balancing its budget as the national economic and fiscal slump continues, with recent forecasts pushing resumption of normal economic growth well into 2004. Revenue Update.

October General Fund revenue receipts were $312 million below the 2002 Budget Act forecast. To date, fiscal year 2002-03 General Fund revenues are $381 million below expectations.

Combined with our preliminary estimate of $1.4 billion in lower-than-projected accrued revenues for the prior fiscal year, the total fiscal year-to-date and prior-year shortfall is about $1.8 billion.

[Saundra Duffy]

Try this link for details: http://www.documents.dgs.ca.gov/osp/midyrbudget/pdf/midyr02.pdf

[NormsRevenge]

The old saying that comes to mind is .. "And the Band Played On" .. as the sleak ocean liner, The SS California, slid beneath the waves.
Maybe we can send Robert Ballard or James Cameron looking for our once great state. It appears to have slid into an ocean of .. poopy stuff. :-\

[ECM]

I can assure you that many, many of us are not.

[tubebender]

While the exact magnitude of the budget gap is still unknown, the Administration will present a balanced plan to address the full extent of the shortfall in the Governor’s 2003-04 Budget to be released in January.

Now that's more like it...

[Ernest_at_the_Beach]

Davis is really gonna do it, eh!

It's a political game plan , not sure exactly how it will unwind though!
I would bet there will be miniscule cuts and massive increase in taxes and fees!

calgov2002:

calgov2002: for old calgov2002 articles. 

calgov2002: for new calgov2002 articles. 

Other Bump Lists at: Free Republic Bump List Register

[EggsAckley]

I just have one question. Where did all the money go? Sounds naive, but it's certainly a question that doofus SHOULD have to answer.

[NormsRevenge]

CA: Davis: $10 billion in cuts (Davi$ Delivers .. doo doo!)

[goldstategop]

No wonder Gray Davis is against a tax increase. It would take away a good chunk of his personal income. LOLOLOL!!!