Posted on 01/10/2009 8:18:41 AM PST by BGHater
With Gov. Arnold Schwarzenegger's veto of Democrats' $18-billion package of tax hikes and cuts, the state could begin issuing IOUs as soon as Feb. 1. GOP legislators join a suit against the package.
State officials on Tuesday braced for the possibility of delaying tax refunds to millions of Californians, along with student grants and payments to vendors, as the latest round of budget negotiations between Gov. Arnold Schwarzenegger and Democratic legislators collapsed.
With little more than a month's worth of cash left in the state treasury, the governor and lawmakers have been unable to agree on how to erase a budget gap projected to reach $41.6 billion by the middle of next year. Democrats announced Tuesday that two weeks of discussions had ended in an impasse and sent Schwarzenegger the $18-billion fiscal package they passed last month. The governor vetoed it, as he had promised to do.
State Controller John Chiang has said that as early as Feb. 1, his office may begin issuing promissory notes if lawmakers have not resolved the budget crisis. The state has done this only once before since the Great Depression -- in 1992.
"We have not made any decision about deferring payments or using IOUs, but they are possibilities if the governor and Legislature don't come to some agreement soon," Chiang spokeswoman Hallye Jordan said Tuesday.
Under the state Constitution, schools and bondholders get first rights to any cash in the state's coffers.
Among the first to get IOUs instead of payments would be business and individual taxpayers who are expecting refunds, local governments and recipients of grants from the California Student Aid Commission. Last year, more than 10 million taxpayers received state refunds totaling $8 billion.
(Excerpt) Read more at latimes.com ...
This is beyond disturbing. I’m thinking of starting a pool to pick the date when American society completely collapses under the weight of government spending at all levels, but I’m not sure there will be a society on the other end of the tunnel to spend my winnings.
I’m not getting a refund; but when I send in my check to Sacramento I think I’ll just send an IOU.
Guess that vote buying deal only works when the politicians actually have the MONEY to pay for the vote..........ha ha ha ha
This should teach people to change their withholding and not get “refunds” anymore. Why let the gov’t earn interest, anyway? I always send them a check in mid April and not one day earlier.
I bet it ends with -09
Am I the only one who finds this statement incredulous? Are these people really negotiating the livelihood of the state of CA? Why can't politicians drop the political crap of who gets credit for what and work to solve a problem independent of who "wins". The winner should be the citizens of the state of CA, not some dimwitted politician who thinks he needs to get credit for some. Idiots.
This is the opportunity for Californians to take control of their government (ie, “by the people, for the people”) by withholding payment for individual and business taxes. What can the state really do? I’m not suggesting not filing, just sending in IOUs to the State. Certainly there’s justification for such a revolt.
If you have the discipline to put the tax money you owe into a bank savings account - AND NOT WITHDRAW ANY OF IT UNTIL THE TAXES ARE ACTUALLY DUE - that is the best way to handle your money.
At least the Feds expect either withholding or estimated payments. If you don't pay anything until April they will send you an extra bill.
Perhaps the people of California should start by impeaching Governor Arnold and demanding a recall election for all the state legislators. None of this will get fixed without throwing out the idiots that caused it.
And the majority of Californians will continue to vote Libs, like Arnold, and RATS like Boxer, Pelosi, Feinstein et al into power. When will the people learn?? It might be too late.
Why work when the pies are free. At least until they run out of free pies to give away.
If there ever was a free pie for everyone state, it’s California.
Yes, you will have to send quarterly checks; but for the minimum amount to satisfy your estimate of the taxes due.
I have a family member that lives in California. He works for the state. During a recent meeting, the employees were informed that instead of paychecks, they may be receiving IOU’s.
California is ranked #1 in population in the US, and 3rd in area, and they’ve gone belly up. That’s “Progressive” for you.
They can and will charge you penalty and interest.
It adds up FAST
There will also be a lien placed on any property you own.
On the non payment issue they have all the tricks in their bag and you have none.
As a business owner I've been in that situation and most assuredly do not want to be there again.
On a personal level I'd withhold taxes, but as a business it's not worth it.
Aunt Nancy is going to send Ahnold a big o’l fat check on Jan 21.
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