State officials say big tax hikes and deep spending cuts are on the way for California. That’s because the state has fallen short in its efforts to get ten-billion dollars in federal stimulus money.
The State Treasurer and the Director of Finance announced that California will receive a little over eight billion dollars in federal money to help balance the budget.
But ten billion was needed to avoid more spending cuts and tax increases under the budget agreement hashed out last month by lawmakers and Governor Schwarzenegger.
The shortfall means nearly two-billion dollars in tax hikes and another 950-million in cuts to health care and state social service programs. State Assembly Speaker Karen Bass says she’s disappointed….
“I’m very concerned about the cuts that already have been done let alone the idea of making even more devastating cuts in particular to education and health and human services…”
California still expects to get about 50-billion dollars in federal economic stimulus money but that can’t be used to shrink the state’s deficit.