California Struggles to Resolve Disruptive Financial Deadlock
California lawmakers scrambled Wednesday to end a deadlock over the state’s overdue budget, as $1 billion in payments to hospitals, nursing homes, colleges and dozens of state suppliers ground to a halt.
“This budget is long overdue and it’s now causing a disruption to some state services,” said Adam Mendelsohn, the communications director for Gov. Arnold Schwarzenegger. “It’s time to get this done.”
A $145 billion budget, due on June 15, was approved by the State Assembly on July 20, but it has languished in the State Senate, where Republican lawmakers are holding out for cuts that would render the document without deficits. The Senate was meeting again Wednesday night in an effort to break the impasse.
Democrats, who control both houses of the Legislature, have been unwilling to make cuts to some programs that serve the poor, such as Medi-Cal, the state’s Medicaid program. They have also opposed a proposed $300 million trim to an entitlement program for children that Republicans would like to see tightened for families that do not comply with certain requirements.
Republicans, led by their most conservative members in the Senate, have countered that the state cannot afford extensive programs at a time of deficits, and have asked for over $800 million in additional cuts.
“Their mantra has been blind, elderly and disabled,” said David Orosco, a spokesman for the Senate Republican Caucus, referring to the people that Democrats have said would be hurt by further trims. “We are looking for a reduction in spending.”
Senate President pro tem Don Perata, a Democrat, sent a letter to Dick Ackerman, the Senate minority leader, saying Democrats wanted his caucus “to produce a budget your caucus can support unanimously — not simply a list of cuts to the budget conference report.”
Schwarzenegger, a Republican, is able to trim the budget with line-item vetoes. But the Republican caucus, irked by the governor’s proclaimed era of “post partisanship,” is loath to give him a commodious victory by passing the budget. Republican senators did meet with the governor earlier in the week, but with no immediate result.
California is one of the few states that requires a two-thirds majority vote in the legislature to pass a budget; that means a budget measure could pass the 40-member Senate with just two of 15 Republican senators signing off, but so far the Republican caucus has remained united.
The state’s constitutional deadline for passing a budget is June 15, although the legislature generally views July 1, the start of the state’s fiscal year, as its deadline. Should the Senate fail to approve a budget Wednesday night, the process will be held up until the Assembly returns on Aug. 20.
The state’s comptroller, John Chiang, said Tuesday that the state would be unable to make payments to hospitals, nursing homes, community colleges and multiple vendors that provide services to the state. While Chiang is authorized to pay doctors and nurses from the state’s general fund until a budget is passed, his office cut off $227 million beginning this week to hospitals and nursing homes in Medi-Cal payments.