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State lawmakers to take pay cut next year

May 21, 2009 12:00:00 AM PDT
California's budget crisis is deepening. Now that voters have rejected a slate of ballot measures, the state is now bracing for what could be severe cuts.Governor Schwarzenegger says voters were loud and clear that the state and governor should not come to them to solve the state's problems. The deficit now could be more than $24 billion.

"There will be no revenue increases," said Gov. Schwarzenegger. "It means cuts, cuts, cuts and living within our means. That is the message of the people."

Treasury Secretary Timothy Geithner says there won't be any bank bailout money available to guarantee short-term debt in states like California.

The non-partisan state Legislative Analyst's Office warned it would be poor fiscal policy for the governor to go ahead with his plan to sell off key assets and borrow short term.

A state panel that sets elected officials' pay reduced the salaries of all of them by 18 percent, starting next year. The governor takes no salary.

Lawmakers admit the pay cuts will hurt them as they live between home and Sacramento.

"Given the current economic downturn -- I do understand cuts have to be made -- and we have to dig deep, then I guess we will just have to dig deep," said Assemblyman Isadore Hall (D-Compton).

"As somebody who's been a former teacher, you can't very well give us a passing grade, and thus the salary that's commensurate with it, so I have no problem with it at all," said Assemblyman Paul Cook (R-Yucca Valley).

State employees at the Department of Consumer Affairs face pay cuts of up to 10 percent.

The Legislative Analyst's Office recommends cutting their salaries by another 4.6 percent for immediate savings.

Education and state services are facing deep cuts because of the deficit. The governor's proposed cuts would end health insurance for 225,000 children in the Healthy Families Program.

"The cuts we are going to have to make are very brutal," said Assemblywoman Noreen Evans (D-Santa Rosa). "If you look at the governor's May revise, the cuts that he intends to make to social services and education -- really, they affect all the children of the state."

The Legislative Analyst's Office warns that the governor's proposal relies too heavily on borrowing from local governments and using federal stimulus money, calling them "one-time solutions." Borrowing from money the state dedicates to transportation has been suggested.

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