California CountiesCalifornia State Association of Counties
In the News

State short of cash again; controller issues warning

Feb. 3 -- Every autumn, at the beginning of the fiscal year, the state borrows money to cover its cash needs until spring. This year, the Controller sold a few billion less than he had planned -- and far less than in recent years -- basing the decision on the best revenue and expenditure estimates available at the time.
 
Turns out it wasn't enough.
 
While the decision to sell low will save the state tens of millions in interest costs, counties, schools, and the state's special funds will pay the price instead. See more on the county impacts below. State revenues are trickling in about $2.6 billion under estimates and spending is spilling over by about the same amount.

On Tuesday, the Controller warned lawmakers that if they did not grant him $3.3 billion of "cash solutions," he would likely have to issue IOUs and delay tax refunds to avoid defaulting on payments to schools and bondholders. To address that $3.3 billion shortfall, the Controller, Treasurer, and Department of Finance created a plan that includes borrowing from previously untapped internal funds, borrowing from outside sources, and delaying and deferring payments.

To read more, click here.
State budget discussions begin in earnest

Feb. 3 -- Budget discussions began in earnest this week, as the Administration released hundreds of pages of trailer bill language and the Senate and Assembly Budget Committees met to review the broad outlines of the Governor's proposals.
 
Trailer bills are legislative measures that change policy to conform to the budget. This year, the Department of Finance has provided draft language for an amazing 77 proposed trailer bills. California's Constitution restricts bills from dealing with more than one subject, so each policy change must be in a separate bill.
 
This year's trailer bills range from making the sweeping changes to CalWORKs that the Governor proposes to abolishing four funds that the state no longer uses to repealing and making permissive dozens of state mandates. Some of the proposals are still being written, and those proposed bills are still only placeholders. CSAC staff are combing through the proposals to discover the details of the budget summary the Governor released early last month.

To read more, click here.