"We don't know exactly the amount, but I know it is more than the $3 billion," said Governor Schwarzenegger.
The news comes just one month after Governor Schwarzenegger signed what was supposed to be a "balanced budget."
With the state's financial crisis moving fast, the governor will sign an order on Nov. 5, calling all lawmakers back to the Capitol for a special session. He wants to take advantage of the experienced lawmakers before the freshmen start their term in December.
Some say more budget cuts will definitely be on the table due to signals from Wall Street.
"If we don't cut our budget, our credit rating is going to go down. They told us that. So, it's going to be a miserable November," said Senate President Don Perata (D-Oakland).
Raising revenue is also a priority to soften the blow to any cuts. State leaders want the federal government to extend unemployment benefits and give out more public works money to create jobs.
"We just want to get the economy moving and jobs are the best way," said Assemblyman Mike Villines (R-Clovis).
California's tax system will get closer scrutiny. State leaders have long complained that it's too antiquated, based on taxing goods. However, services like oil changes and haircuts escape taxation in our modern society; as well as many types of internet purchases.
"We will create, which we will announce this week, a tax modernization committee," said Gov. Schwarzenegger.
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