Controller Warns Budget Impasse Taking Toll

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(Sacramento, CA)
Friday, July 27, 2007

State Controller John Chiang says California has more than a billion dollars in outstanding bills for the month of July.   And the number’s closer to 2 billion next month.  He says transportation, education and companies that do business with the state are suffering because they aren’t getting paid.  And he says it could threaten services:

“I mean, if we’re not going to pay foster care providers, will they continue to provide those services?  If we’re not paying for child development programs, are day care centers, others who provide these child development programs going to close up shop?”

Many legislative staffers are relying on short-term interest-free loans because they’re not getting paychecks.  The California Hospital Association says its members are facing a cut-off of Medi-Cal payments if the budget impasse isn’t resolved soon.  
The Assembly has already approved a budget, but it has stalled in the Senate.  Republicans are holding out for more cuts to the spending plan.