Free Republic

Gov. Arnold Schwarzenegger's administration on Tuesday lost a long-running court battle over its plan to sell bonds to cover the state's public employee pension costs. The ruling by the 3rd District Court of Appeal could complicate negotiations over the state's already overdue budget. Republican lawmakers are holding up the $104 billion spending plan in part because they believe it will leave California with an unmanageably large budget deficit next year. Tuesday's ruling may only add to that concern, depriving the state of more than $500 million to help close the estimated $5 billion-plus deficit in the 2008-09 budget year. Schwarzenegger...

SACRAMENTO - A plan to sell $525 million in bonds to cover part of the state's pension obligation this year violates constitutional mandates that voters approve all large loans, a Sacramento County judge ruled Thursday. It is the second time in three years a court has thrown out the idea of selling bonds to pay for retirement costs. Finance officials in Gov. Arnold Schwarzenegger's administration said they will appeal. "This decision is a victory for all Californians against spendthrift practices in the state legislature," said attorney Harold Johnson of the Pacific Legal Foundation. The Sacramento-based conservative nonprofit group filed the...

An Orange County activist group is playing an important part in making sure that Gov. Arnold Schwarzenegger does not repeat a budget mistake that was one of the reasons Gov. Gray Davis was recalled. At issue is $929 million in long-term pension-bond obligations in the 2004-05 state budget, which began July 1. The bonds would fund the state's current pension obligations and be repaid over 20 years. ...A year ago, Gov. Davis' attempt to float a similar bond was thrown out by a Sacramento Superior Court