During
his State of the State address, the governor said California faces a projected
deficit of $14.5 billion. On Jan. 11 the governor proclaimed a fiscal emergency
and proposed a 10 percent decrease in spending in every department. This gives
the state legislature 45 days to act on his proposals, which includes cuts from
the most heavily funded programs, including education, health care and the
prison system.
Schwarzenegger
said the budget problems surface every five years or so because “we have a
system in place that doesn’t work, it’s a broken system.” He explained, “The
bad situation is that it takes everyone on a roller coaster ride so that when
we have our revenues going up, we spend it all. And when the revenues flatten
out, then all of sudden we don’t have enough money for all of those programs
that need money.”
This
year anticipated revenues will be $110 billion for fiscal 2007-2008, which
means the state is at least $4.6 billion short, and, because of flat revenues –
only one percent instead of the anticipated five percent – that number could
triple, he said. The biggest problem is that the state is spending between $400
to $600 million more each month than it’s taking in, which means that there is
now a fiscal emergency and cuts need to be made across the board or it will be
even worse by next year.
He
called the spending “irresponsible,” pointing to charts that show state income
and spending over the last decade. He said the recommended cuts are “the
fiscally responsible thing to do.”
He
called the current budget system a roller coaster ride where the people of
California have to hold on for dear life. And I say this is no way to do it.”
Schwarzenegger
detailed how he has tried for three years to make changes in the budget system
but was voted down not only in the legislature, but also during a special
election. But until the system is fixed, it will continue to be a problem, he
insisted.
He
said the “financial community is looking at California like we’re operating
like a joke, because they’re looking at us and saying we’re not fiscally responsible.”
He added that it is affecting the state’s credit rating, which is one of the
worst in the nation.
Instead
of raising taxes, Schwarzenegger said he wanted to “raise people’s hopes. I
want to raise people’s aspirations, their dreams, and get them going, and give
money back to the people of California.” He detailed the $34 billion returned
to taxpayers since he became governor and said that he would rather give money
back to the people than collect it.
He
said there are two suggestions to fix the budget. These include a rainy day
fund, which takes money during high revenue years and sets it aside for the
lean years. The second recommendation is to have the legislators predetermine
what will be cut if revenues are short so that there are no surprises when that
time actually comes.
“These
programs will work,” he said. With this program in place the state would not
have “to take money away from the schools or from the elderly folks, or from
anyone else.”
Lompoc
Mayor Dick DeWees, during the question and answer
segment after the governor’s speech, invited the governor to spend a day
visiting Lompoc and touring the La Purisma Mission
State Historic Park. The governor has proposed closing 48 state parks, and the
Lompoc site is on that list.
The governor’s visit was hosted by the Santa Barbara Navy
League. Mayors from Buellton, Solvang, Lompoc, Goleta, Guadalupe, Santa Maria
and Carpinteria attended, along with Brooks
Firestone, Joni Gray, Janet Wolf and Salud Carbajal, Santa Barbara County supervisors, as well as
David Smyser, who announced Jan. 10 that he would run
for 3rd District Supervisor.