Schwarzenegger to unveil grim budget revision today
In May, the governor revises the state government’s budget to factor in tax revenue collected in April. The so-called “May revise” that Governor Schwarzenegger unveils today will also have to explain how he plans to fill in a budget hole that could be $20 billion deep.
Back in January, Governor Schwarzenegger proposed a plan to close the $20 billion deficit. It included a threat to slash health care and social service spending if Uncle Sam didn’t come up with $7 billion.
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The Governor said the feds owed California because they required the state to pay for federally-guaranteed health care programs and to keep undocumented felons in prison. So far, Washington’s pledged about half the money California says it’s owed.
HD Palmer with the Department of Finance says state tax revenue also came up short.
“Through the month of March, the state’s receipts were running about $2.7 billion above projections. Unfortunately, in April our tax receipts came in more than $3 billion below. So those gains we had earlier in the year have essentially been negated” Palmer said.
The legislature enacted mid-year cuts to save a little over $1 billion. But in all likelihood, the budget deficit is roughly the same as it was in January - only now Governor Schwarzenegger has new restrictions on how he can close it. For example: he proposed cutting back the Healthy Families
