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California Budget: Now the Real Work Begins

On Tuesday, June 16, 2009, the Joint Budget Conference Committee wrapped up its work on a proposed budget bill. Rejecting outright or modifying a number of the Governor’s proposed budget cuts, the committee proposed a combination of fee and tax increases, with more modified budget cuts. Unfortunately, a number of the committee votes were strictly along partisan lines, which does not bode well for a quick resolution to the budget process.

Proposing a $15 increase in the vehicle license fee to keep public parks from closing and a tax on oil production among others, the committee also rejected outright the elimination of the MSSP program, the Alzheimer’s Resource Centers, Adult Day Health Care, the Healthy Families program and a number of other cuts that would have devastated health and human services to the poor, the aged, the blind and disabled. The committee voted for more modest cuts to programs such as Linkages and community based services that sustain elders and disabled at home, for example. Instead of budget cuts that would have disqualified nearly 90% of IHSS recipients, the committee opted for a more modest 10% cut in services. Rejecting yet another cut of $20 for SSI recipients, the committee voted to reduce benefits $5 for an individual aged, blind or disabled recipient.

SSI/SSP beneficiaries have already been cut to the bone, and the July 1, 2009, cuts are coming. Medi–Cal beneficiaries have lost important, life–sustaining optional benefits. And, make no mistake about it, there will likely be devastating cuts to numerous health and human services programs that will be forced to discontinue services or reject new applicants when it’s all over – if the legislators don’t hear from the people who elected them.

Although a budget requires a two–thirds vote, the revisions passed by the budget committee are revisions to the February budget, which could be passed by a simple majority. However, any tax increases will have to pass both the Senate and the Assembly by a 2/3 vote and be signed by the Governor. Most voters seem to approve some of the $2 billion in proposed tax increases on oil production, cigarettes and, particularly, the $15 vehicle fee increase that would sustain the park system and allow California registered drivers free access to the parks.

Governor Schwarzenegger told reporters on June 17, 2009, that he will veto any budget bill that includes new taxes beyond what he has already proposed. Schwarzenegger and lawmakers already increased personal income, sales and vehicle taxes in a February budget deal. The governor says another general tax increase would be "irresponsible." Weighed against the very real threat of the loss of health coverage for children, essential services to sustain elders and the disabled at home and other vital education, health and human services, it could be argued that it is far more "irresponsible" to be willing to plunge the state into insolvency and a great number of its citizens into even more poverty over $2 billion in tax increases.

We will be sending you alerts and keeping you up to date on the New Developments section of our web site. A consolidation of the Governor’s three May revised proposals is available there. Meanwhile, contact your legislators for details of the Conference Committee’s budget actions.