Mon Jun 15, 2009 7:54pm EDT
SACRAMENTO, California (Reuters) - California lawmakers were poised to miss their constitutional deadline on Monday for a state budget, bringing the state's government closer to running out of cash.
Democrats and Republicans in the legislature's budget conference committee worked through Monday afternoon on a variety of proposals addressing Gov. Arnold Schwarzenegger's plan to close a $24.3 billion budget shortfall, but they failed to find common ground on its most dramatic proposal: eliminating the state's welfare system.
"This meeting is not headed in that direction," Republican Assemblyman Roger Niello said. California's revenues are plunging amid recession, rising unemployment and the prolonged housing crisis, and the state is unable to borrow its way out of its immediate financial trouble by issuing debt at low cost because of its budget gap.
It will run out of cash within weeks if it does not balance its books, leaving it little option but to postpone a variety of payments, according to State Controller John Chiang, who estimated last week that California was "less than 50 days away from a meltdown of state government." Democrats, who control California's legislature, said their aim is to cut spending, but to maintain a base of government programs, including many for the needy.
Republicans countered that only dramatic cuts will balance California's budget for its next fiscal year, which begins in July.
Some state Assembly Democrats have talked about the possibility of increasing some taxes to raise revenues, but both Schwarzenegger and Republicans said no.
Republicans have enough votes to block budgets from passing and have used the power in previous years to delay spending plans from reaching the governor's desk.
In fact, the legislature has missed its constitutional budget deadline for more than 20 years running. It is not unusual for the government of the most populous U.S. state to begin its new fiscal year without a spending plan in place which is one reason why California has the lowest credit rating of any U.S. state.
In most years, California officials have been able to rely on the state's growing economy to fill the state's government's coffers -- even as the bickered over budget plans.
The sooner California has a budget, the sooner it will be able to approach Wall Street to sell short-term debt in the form of revenue anticipation notes to help smooth out its near term finances, according to the state treasurer's office.
(Reporting by Jim Christie, editing by Leslie Gevirtz)
Reuters 2009
Monday, June 15, 2009
Thursday, June 11, 2009
Governor, Democratic Lawmakers Face Off on Budget Proposals
Thursday, June 11, 2009
Gov. Arnold Schwarzenegger (R) and Senate and Assembly Democrats are butting heads over various proposals to address California's estimated $24 billion budget deficit, the Los Angeles Times reports.
During an interview with the Times' editorial board Wednesday, Schwarzenegger said it would be "irresponsible" to pursue the Senate Democrats' budget proposal, which calls for closing the budget gap by dipping into state reserves.
"We have not hit the bottom" of the economic downturn, the governor said (Goldmacher, Los Angeles Times, 6/11).
On Tuesday, Senate President Pro Tempore Darrell Steinberg (D-Sacramento) proposed a budget that would leave less than $1 billion in state reserves in an effort to preserve programs such as Healthy Families, the state's Children's Health Insurance Program.
Democrats also hope to preserve in-home support services for the elderly and HIV/AIDS programs.
Steinberg said legislators would be willing to pare down such programs, but not cut them entirely (California Healthline, 6/10).
No Short-Term Loans
Schwarzenegger also told the Times he would let California's government come to a "grinding halt" rather than approve a high-interest loan if lawmakers cannot decide on a budget plan in the coming weeks.
State officials estimate that California will run out of cash by the end of July unless a budget agreement is reached (Los Angeles Times, 6/11).
Assembly Democrats Speak Up
In the Assembly, Speaker Karen Bass (D-Los Angeles) did not comment on Steinberg's plan, but said Assembly Democrats would focus on looking for ways to raise new revenue.
Although sources say Bass and Steinberg continue to work together closely, differences in their budget approaches could reflect growing divisions among Democrats in the two houses, Capitol Weekly reports.
Senate Democrats support cutting some state services, while Assembly Democrats have resisted some of these proposals, including eliminating money for rural hospitals (York, Capitol Weekly, 6/11).
On Wednesday, Bass said that lawmakers "can't solve a deficit this big through cuts alone," adding that she would prefer a balanced approach that includes an equal amount of new revenue.
Bass did not elaborate on the options Assembly members are considering to raise revenue, but she said some could be implemented with a majority vote in the Legislature, meaning that they would constitute fees or other non-tax measures. She also said the Assembly intends to reach a budget agreement by the end of June.
SEIU Calls for Tax Increases
On Wednesday, the Service Employees International Union launched a $1 million advertising campaign in favor of raising taxes to help address the deficit.
SEIU represents 700,000 Californians, including in-home health care workers and others who could lose state funding under the proposed budget cuts (Sanders, Sacramento Bee, 6/11).
Opinion Piece
Schwarzenegger's proposals to reduce state spending for Medi-Cal and Healthy Families will result in the loss of federal funds, meaning that "the governor's proposals are not just seemingly heartless, they are wholly counterproductive to any attempt to get us out of our economic distress," Anthony Wright, executive director of Health Access, writes in a San Francisco Chronicle opinion piece.
Wright calls for the governor to revisit his earlier health care reform proposals and consider other ways to generate revenue, such as expanding the sales tax (Wright, San Francisco Chronicle, 6/11).
Source: Californiahealthline.org
Gov. Arnold Schwarzenegger (R) and Senate and Assembly Democrats are butting heads over various proposals to address California's estimated $24 billion budget deficit, the Los Angeles Times reports.
During an interview with the Times' editorial board Wednesday, Schwarzenegger said it would be "irresponsible" to pursue the Senate Democrats' budget proposal, which calls for closing the budget gap by dipping into state reserves.
"We have not hit the bottom" of the economic downturn, the governor said (Goldmacher, Los Angeles Times, 6/11).
On Tuesday, Senate President Pro Tempore Darrell Steinberg (D-Sacramento) proposed a budget that would leave less than $1 billion in state reserves in an effort to preserve programs such as Healthy Families, the state's Children's Health Insurance Program.
Democrats also hope to preserve in-home support services for the elderly and HIV/AIDS programs.
Steinberg said legislators would be willing to pare down such programs, but not cut them entirely (California Healthline, 6/10).
No Short-Term Loans
Schwarzenegger also told the Times he would let California's government come to a "grinding halt" rather than approve a high-interest loan if lawmakers cannot decide on a budget plan in the coming weeks.
State officials estimate that California will run out of cash by the end of July unless a budget agreement is reached (Los Angeles Times, 6/11).
Assembly Democrats Speak Up
In the Assembly, Speaker Karen Bass (D-Los Angeles) did not comment on Steinberg's plan, but said Assembly Democrats would focus on looking for ways to raise new revenue.
Although sources say Bass and Steinberg continue to work together closely, differences in their budget approaches could reflect growing divisions among Democrats in the two houses, Capitol Weekly reports.
Senate Democrats support cutting some state services, while Assembly Democrats have resisted some of these proposals, including eliminating money for rural hospitals (York, Capitol Weekly, 6/11).
On Wednesday, Bass said that lawmakers "can't solve a deficit this big through cuts alone," adding that she would prefer a balanced approach that includes an equal amount of new revenue.
Bass did not elaborate on the options Assembly members are considering to raise revenue, but she said some could be implemented with a majority vote in the Legislature, meaning that they would constitute fees or other non-tax measures. She also said the Assembly intends to reach a budget agreement by the end of June.
SEIU Calls for Tax Increases
On Wednesday, the Service Employees International Union launched a $1 million advertising campaign in favor of raising taxes to help address the deficit.
SEIU represents 700,000 Californians, including in-home health care workers and others who could lose state funding under the proposed budget cuts (Sanders, Sacramento Bee, 6/11).
Opinion Piece
Schwarzenegger's proposals to reduce state spending for Medi-Cal and Healthy Families will result in the loss of federal funds, meaning that "the governor's proposals are not just seemingly heartless, they are wholly counterproductive to any attempt to get us out of our economic distress," Anthony Wright, executive director of Health Access, writes in a San Francisco Chronicle opinion piece.
Wright calls for the governor to revisit his earlier health care reform proposals and consider other ways to generate revenue, such as expanding the sales tax (Wright, San Francisco Chronicle, 6/11).
Source: Californiahealthline.org
Thursday, June 4, 2009
STATE BUDGET CUTS TO HEALTH CARE
MORE THAN 1.9 MILLION CALIFORNIANS COULD LOSE ACCESS TO HEALTH COVERAGE UNDER THE GOVERNOR’S MAY REVISION
At a time when the federal government is seeking ways to expand health coverage to more Americans, Governor Schwarzenegger has proposed substantial cuts that could result in more than 1.9 million Californians losing access to health coverage within three years.* In addition, these cuts would cause California to lose an estimated $2.3 billion in federal matching funds in 2009-10 alone. Specifically:
• The Governor proposes to reduce state funding for the Medi-Cal Program by $1.0 billion in 2009-10 through unspecified changes that would likely include limits on eligibility for Medi-Cal services. The Administration would need permission from the federal government to make eligibility cuts, due to provisions in the American Recovery and Reinvestment Act of 2009 (ARRA). In the past year, the Governor has proposed three eligibility changes that could cause nearly 1 million Californians to lose access to health coverage (see table). While the Legislature previously rejected these proposals, all three could be included in the Administration’s proposed $1.0 billion reduction – a cut that would cause the state to lose an estimated $1.6 billion in federal funds in 2009-10 under ARRA’s enhanced matching rate of 61.59 percent.
• The Governor also released, on May 26, a proposal to eliminate the Healthy Families Program as of August 1, 2009. Previously, the Governor proposed dropping 225,000 children from the program. If Healthy Families were eliminated, 942,000 California children who would otherwise have been covered as of June 30, 2010 – the end of the 2009-10 fiscal year – would not be covered, according to the most recent state estimate available, which likely understates the number of children affected. Eliminating the program would reduce General Fund spending by $369 million in 2009-10, but California would also lose approximately $685 million in federal matching funds.
More Than 1.9 Million Californians Could Lose Access to Health Coverage Under the Governor’s May Revision
Potential Cut Number of Californians Affected:
• Medi-Cal Program Require families to file paperwork four times per year for their children to retain health coverage (471,500 at full impact)
• Restrict low-income working parents’ eligibility for no-cost health coverage (433,600 at full impact)
• Limit the number of seniors and people with disabilities with access to no-cost health coverage (73,400 in 2009-10)
• Healthy Families Program - Eliminate the program (942,000 as of June 30, 2010)
TOTAL IMPACT --> 1,920,500+ CALIFORNIANS!!!
*One potential cut, for example, would take 33 months to reach full impact. The more than 1.9 million estimate reflects state projections as of May 2008 and November 2008. Rising caseloads due to the economic downturn suggest that the actual number of Californians who could lose access to health coverage could exceed 2 million.
Source: Department of Finance, Department of Health Care Services, and Managed Risk Medical Insurance Board
Report Prepared by: The California Budget Project (June 1, 2009) http://www.cbp.org/
---Spanish:
Mas de 1.9 millones de residentes de California podrían perder cobertura médica bajo la revisión presupuestal del mes de Mayo del Gobernador
• En una época en la que el gobierno federal está buscando la manera de expandir la cobertura a más americanos, el Gobernador Schwarzenegger ha propuesto reducciones sustanciales y como resultado, más de 1.9 millones de residentes de California dejarán de tener acceso a cobertura médica en los próximos tres años. * Además, estas reducciones harían que California dejara de recibir aproximadamente 2.3 mil millones de dólares en aportaciones federales en 2009-10. Específicamente:
• El Gobernador propone reducir las aportaciones estatales al programa de Medi-Cal en mil millones de dólares en 2009-10 a través de cambios no especificados que muy probablemente incluyan restricciones en elegibilidad a los servicios de Medi-Cal. La Administración necesitaría autorización de parte del gobierno federal para establecer dichas restricciones, de acuerdo a lo establecido en la Ley Americana de Recuperación e Inversión de 2009 (ARRA). En el ultimo año, el Gobernador ha propuesto 3 cambios a la elegibilidad que podrían causar que un millón de residentes de California perdieran acceso a cobertura médica (ver tabla) A pesar de que la Legislación ya había rechazado estas propuestas, las 3 podrían ser incluidas en la reducción de mil millones de dólares que sugiere la Administración – una reducción que provocaría que el estado perdiera 1.6 mil millones de dólares en aportaciones del gobierno federal en 2009-10 bajo la tarifa de aportaciones de la Ley de ARRA a un nuevo porcentaje de 61.59 por ciento.
• En mayo 26, el Gobernador también anuncio una propuesta para eliminar el programa de Healthy Families a partir de agosto 1, 2009. Anteriormente, el Gobernador propuso sacar a 225,000 niños de este programa. Si el programa de Healthy Families fuera eliminado, 942,000 niños que habrían recibido cobertura a partir de Junio 30, 2010 – el final del año fiscal 2009-10- no tendrán cobertura, esto de acuerdo a los cálculos mas recientes disponibles, los cuales probablemente no reflejen el numero real de niños que se verían afectados. La eliminación del programa reduciría el Fondo General de gastos en $369 millones en 2009-10, pero California también perdería aproximadamente $685 millones en aportaciones federales.
Más de 1.9 millones de residentes de California podrían perder cobertura médica bajo la revisión presupuestal del mes de Mayo del Gobernador.
Posibles reducciones - Numero de residentes de California afectados - Programa Medi-Cal:
• Requiere que las familias presenten documentos de solicitud 4 veces al año para conservar su cobertura (Impacto total 471,500).
• Restricción de elegibilidad para cobertura médica a padres de bajos ingresos (Impacto total 433,600).
• Reducción del numero de personas de la tercera edad y con discapacidades que tienen acceso a cobertura médica sin costo (73,400 en 2009-10).
• Programa de Healthy Families - Eliminación del programa (942,000 a partir de Junio 30, 2010).
¡¡¡IMPACTO TOTAL --> 1,920,500+ CALIFORNIANOS!!!
Fuente: Department of Finance, Department of Health Care Services, and Managed Risk Medical Insurance Board
* Ejemplo: para verse el impacto total en una posible reducción, se llevarían 33 meses. El calculo de más de 1.9 millones refleja las proyecciones del estado a partir de Mayo 2008 y Noviembre 2008. El aumento en el número de casos debido a la crisis financiera sugiere que el número real de residentes de California que perderían acceso a cobertura medica podría exceder los 2 millones.
Reporte preparado por: The California Budget Project (June 1, 2009) http://www.cbp.org/
At a time when the federal government is seeking ways to expand health coverage to more Americans, Governor Schwarzenegger has proposed substantial cuts that could result in more than 1.9 million Californians losing access to health coverage within three years.* In addition, these cuts would cause California to lose an estimated $2.3 billion in federal matching funds in 2009-10 alone. Specifically:
• The Governor proposes to reduce state funding for the Medi-Cal Program by $1.0 billion in 2009-10 through unspecified changes that would likely include limits on eligibility for Medi-Cal services. The Administration would need permission from the federal government to make eligibility cuts, due to provisions in the American Recovery and Reinvestment Act of 2009 (ARRA). In the past year, the Governor has proposed three eligibility changes that could cause nearly 1 million Californians to lose access to health coverage (see table). While the Legislature previously rejected these proposals, all three could be included in the Administration’s proposed $1.0 billion reduction – a cut that would cause the state to lose an estimated $1.6 billion in federal funds in 2009-10 under ARRA’s enhanced matching rate of 61.59 percent.
• The Governor also released, on May 26, a proposal to eliminate the Healthy Families Program as of August 1, 2009. Previously, the Governor proposed dropping 225,000 children from the program. If Healthy Families were eliminated, 942,000 California children who would otherwise have been covered as of June 30, 2010 – the end of the 2009-10 fiscal year – would not be covered, according to the most recent state estimate available, which likely understates the number of children affected. Eliminating the program would reduce General Fund spending by $369 million in 2009-10, but California would also lose approximately $685 million in federal matching funds.
More Than 1.9 Million Californians Could Lose Access to Health Coverage Under the Governor’s May Revision
Potential Cut Number of Californians Affected:
• Medi-Cal Program Require families to file paperwork four times per year for their children to retain health coverage (471,500 at full impact)
• Restrict low-income working parents’ eligibility for no-cost health coverage (433,600 at full impact)
• Limit the number of seniors and people with disabilities with access to no-cost health coverage (73,400 in 2009-10)
• Healthy Families Program - Eliminate the program (942,000 as of June 30, 2010)
TOTAL IMPACT --> 1,920,500+ CALIFORNIANS!!!
*One potential cut, for example, would take 33 months to reach full impact. The more than 1.9 million estimate reflects state projections as of May 2008 and November 2008. Rising caseloads due to the economic downturn suggest that the actual number of Californians who could lose access to health coverage could exceed 2 million.
Source: Department of Finance, Department of Health Care Services, and Managed Risk Medical Insurance Board
Report Prepared by: The California Budget Project (June 1, 2009) http://www.cbp.org/
---Spanish:
Mas de 1.9 millones de residentes de California podrían perder cobertura médica bajo la revisión presupuestal del mes de Mayo del Gobernador
• En una época en la que el gobierno federal está buscando la manera de expandir la cobertura a más americanos, el Gobernador Schwarzenegger ha propuesto reducciones sustanciales y como resultado, más de 1.9 millones de residentes de California dejarán de tener acceso a cobertura médica en los próximos tres años. * Además, estas reducciones harían que California dejara de recibir aproximadamente 2.3 mil millones de dólares en aportaciones federales en 2009-10. Específicamente:
• El Gobernador propone reducir las aportaciones estatales al programa de Medi-Cal en mil millones de dólares en 2009-10 a través de cambios no especificados que muy probablemente incluyan restricciones en elegibilidad a los servicios de Medi-Cal. La Administración necesitaría autorización de parte del gobierno federal para establecer dichas restricciones, de acuerdo a lo establecido en la Ley Americana de Recuperación e Inversión de 2009 (ARRA). En el ultimo año, el Gobernador ha propuesto 3 cambios a la elegibilidad que podrían causar que un millón de residentes de California perdieran acceso a cobertura médica (ver tabla) A pesar de que la Legislación ya había rechazado estas propuestas, las 3 podrían ser incluidas en la reducción de mil millones de dólares que sugiere la Administración – una reducción que provocaría que el estado perdiera 1.6 mil millones de dólares en aportaciones del gobierno federal en 2009-10 bajo la tarifa de aportaciones de la Ley de ARRA a un nuevo porcentaje de 61.59 por ciento.
• En mayo 26, el Gobernador también anuncio una propuesta para eliminar el programa de Healthy Families a partir de agosto 1, 2009. Anteriormente, el Gobernador propuso sacar a 225,000 niños de este programa. Si el programa de Healthy Families fuera eliminado, 942,000 niños que habrían recibido cobertura a partir de Junio 30, 2010 – el final del año fiscal 2009-10- no tendrán cobertura, esto de acuerdo a los cálculos mas recientes disponibles, los cuales probablemente no reflejen el numero real de niños que se verían afectados. La eliminación del programa reduciría el Fondo General de gastos en $369 millones en 2009-10, pero California también perdería aproximadamente $685 millones en aportaciones federales.
Más de 1.9 millones de residentes de California podrían perder cobertura médica bajo la revisión presupuestal del mes de Mayo del Gobernador.
Posibles reducciones - Numero de residentes de California afectados - Programa Medi-Cal:
• Requiere que las familias presenten documentos de solicitud 4 veces al año para conservar su cobertura (Impacto total 471,500).
• Restricción de elegibilidad para cobertura médica a padres de bajos ingresos (Impacto total 433,600).
• Reducción del numero de personas de la tercera edad y con discapacidades que tienen acceso a cobertura médica sin costo (73,400 en 2009-10).
• Programa de Healthy Families - Eliminación del programa (942,000 a partir de Junio 30, 2010).
¡¡¡IMPACTO TOTAL --> 1,920,500+ CALIFORNIANOS!!!
Fuente: Department of Finance, Department of Health Care Services, and Managed Risk Medical Insurance Board
* Ejemplo: para verse el impacto total en una posible reducción, se llevarían 33 meses. El calculo de más de 1.9 millones refleja las proyecciones del estado a partir de Mayo 2008 y Noviembre 2008. El aumento en el número de casos debido a la crisis financiera sugiere que el número real de residentes de California que perderían acceso a cobertura medica podría exceder los 2 millones.
Reporte preparado por: The California Budget Project (June 1, 2009) http://www.cbp.org/
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