Calif. Budget Deal Pays '08 Debt With '09 Taxes

State controller refuses to cut smaller checks

(NEWSER) - Arnold Schwarzenegger upped the ante in his budget standoff with the state legislature yesterday, ordering almost all state workers' pay cut to the federal minimum wage—$7.25 per hour—effective immediately. The State Controller, Democrat John Chiang, says he won’t obey that order, the LA Times reports, but the Department of Personnel Administration says he doesn’t have a choice. The last time Chiang refused to cut worker benefits, in 2008, Schwarzenegger took him to court and won. More»

Despite one ruinous turn as governor, Jerry Brown is front-runner

(NEWSER) - California is a financial mess, hamstrung by some late-1970s leftovers: some ill-considered “low-impact liberalism” and a ballot measure that makes raising taxes nearly impossible. Both came during the governorship of Democrat Jerry Brown, he of the motto “Maybe by avoiding doing things you accomplish quite a lot”—and the leading candidate to succeed Arnold Schwarzenegger in next year’s election. More»

Full-scale regulation and taxation on the table in Calif.

(NEWSER) - The recession has given marijuana-legalization advocates an unexpected boost, Time reports, as cash-strapped states are tempted by possible revenues from pot taxes. With an existing medical-marijuana market and cuts to education and health services pending due to a huge budget deficit, California advocates are preparing both legislation and ballot initiatives to regulate and tax all marijuana sales for adults 21 and over. More»

(AP) - California's state assembly today approved a plan to close most of its $26 billion budget deficit, sending the package of financial fixes to Gov. Arnold Schwarzenegger, who's expected to sign it by Monday. The Assembly rejected two of the most controversial measures, a plan to take about $1 billion in transportation funding from local governments, and allowing oil drilling off the California coast for the first time in 40 years. More»

Plan calls for massive cuts to close $26B budget hole

(NEWSER) - After weeks of wrangling, Gov. Arnold Schwarzenegger has made a deal with state lawmakers to close the $26 billion hole in California's budget, the Sacramento Bee reports. Leaders believe the plan—which involves massive spending cuts and borrowing from city governments—is solid enough to secure billions of dollars in short-term loans, allowing the state to stop issuing emergency IOUs. More»