A large portion of the budget is constitutionally protected and cannot be legally touched, so Schwarzenegger is turning again to the safety-net programs that helped the poor, disabled and elderly. He is eliminating CalWORKS, In-Home Support Services Program and the Healthy Families Program.
Last year, he was criticized for turning California's safety net from one that was generous to one that is stingy. For example, adult health daycare was slashed to force seniors to cut attendance from five days a week to just two. These are services that help seniors socialize, stay alert and stay healthy.
Patricia Pile's elderly mother has dementia and benefits greatly from adult health daycare. She fears the governor will completely eliminate that program.
"I just feel my mother will sit and, excuse the expression, rot away. There's nothing for her, per say, of the magnitude that an adult day health program can do for my mother," she said.
Several public employee unions said they heard the governor will call for an end to furloughs three days a month, effective at the end of June, and will ask for a 5 percent cut in pay from state workers instead and greater contributions to their pensions.
He also seeks to raise money by rolling back recent corporate tax breaks, expanding oil drilling off the Santa Barbara coast and calling on the federal government for more assistance.
The Republican governor vowed to protect spending for public schools and colleges after cutting their funding by billions of dollars in recent years, actions that have sparked student protests throughout the state.
The continued austerity measures are a fallout from the national recession, which has pummeled California's economy and boosted the state's unemployment rate to 12.3 percent, third highest in the nation.
Schwarzenegger said the state is slowly beginning to emerge from the worst economic downturn in decades but that it would be years before tax revenue recovers.
"Tough times still lie ahead," he said.
The Associated Press contributed to this story.