The June Swoon: Budget Mania

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Welcome to the final month of the 2008-2009 fiscal year for state government, and buckle your seatbelts for what promises to be one of the most unusual -- and difficult -- summers in state Capitol history.

Governor Schwarzenegger's speech to a joint session of the Legislature tomorrow morning represents a sort of final pitch for his plan on how to crawl out of the budget mess and a $22 billion deficit. Spokesman Aaron McLear described the speech today as a "rallying cry" for moving forward, and the 10:00 a.m. event in the Assembly chambers is expected to be short.

Schwarzenegger's budget team has now put together a single budget proposal, posted online this afternoon, to replace the four various budget documents that have been floating around since the middle of last month.

That document, outlining all of his $24 billion budget solutions, is a 14-page overview of both spending reductions and revenue solutions, the latter of which there are very few (note: as stated previously, the governor's plan includes a reserve which -- by definition -- is not a deficit, hence the discrepancy between $22 billion and $24 billion.)

One helpful overview is a chart in the new document that shows the following information: Schwarzenegger's best-case scenario before the May 19 election rejection was about $8.3 billion in solutions through the end of June 2010. On May 20, the list grew by $7.2 billion. On May 26, he added on another $5.5 billion (largely reflecting his abandonment of a controversial borrowing plan). And on May 29, he tacked on another $2.8 billion in solutions to account for estimates of even lower-than-expected revenues.

Today's news featured a daylong hearing of the joint legislative budget conference committee on the subject of budget solutions in K-12 and higher education. As the public testimony revealed, it's not just less money for the classroom. Advocates of child care programs paid for under the Proposition 98 guarantee criticized Schwarzenegger's plan, as did those who depend on school buses for kids to get to school.

On the latter, several people testified that the governor's plan would disproportionately hurt rural areas where school buses are relied upon. "Without a school bus, most if not all of these students would be unable to attend school," said Kirk Hunter, CEO of the nonprofit Southwest Transportation Agency in Fresno County.

Once the governor delivers tomorrow's speech, the real negotiations are likely to begin. But the huge problem... and the suggestion of major public policy shifts by cutting spending... would seem to add up to a long debate. Trouble is, the state doesn't seem to have the luxury of time; Controller John Chiang said late last week that a comprehensive solution needs to be in place in just two weeks time to allow billions of dollars in Wall Street borrowing to take place.

So how does it all work out? None of the usual Capitol brainy folks seem to know... except that, in the end, everyone -- and everything -- is likely to take a serious whack.

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About John Myers

John Myers is senior editor of KQED's new multimedia California Politics & Government Desk.  He has covered California politics for most of the past two decades -- serving previously as Sacramento bureau chief for KQED News and, most recently, as political editor for KXTV News10 (ABC) in Sacramento. He moderated the only gubernatorial debate of 2014, and was named one of the nation's top statehouse reporters by The Washington Post. Follow him on Twitter @johnmyers.

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