AP Associated Press
December 1, 2008 4:58 PM
Schwarzenegger Declares Emergency
SACRAMENTO, Calif. — Gov. Arnold Schwarzenegger declared a fiscal emergency Monday and called lawmakers into a special session to address California's $11.2 billion deficit.
The state's revenue gap is expected to hit $28 billion over the next 19 months without bold action. The emergency declaration authorizes the governor and lawmakers to change the existing budget within 45 days.
The state is likely to run out of cash in February.
The Republican governor and Democratic lawmakers have proposed a combination of tax increases and spending cuts, but Republican lawmakers steadfastly refuse to raise taxes.
During last month's session, Democrats proposed $8.2 billion in spending cuts and $8.2 billion in tax increases. Republicans rejected it and instead sought an economic stimulus program.
Schwarzenegger asked for both, offering essentially the same plan rejected last month.
His proposal includes raising the state sales tax by 1.5 percentage points _ or 1 1/2pennies on the dollar _ for three years, generating $3.5 billion in the current fiscal year. He also seeks to increase the annual fee for registering vehicles.
December 1, 2008 4:58 PM
Schwarzenegger Declares Emergency
SACRAMENTO, Calif. — Gov. Arnold Schwarzenegger declared a fiscal emergency Monday and called lawmakers into a special session to address California's $11.2 billion deficit.
The state's revenue gap is expected to hit $28 billion over the next 19 months without bold action. The emergency declaration authorizes the governor and lawmakers to change the existing budget within 45 days.
The state is likely to run out of cash in February.
The Republican governor and Democratic lawmakers have proposed a combination of tax increases and spending cuts, but Republican lawmakers steadfastly refuse to raise taxes.
During last month's session, Democrats proposed $8.2 billion in spending cuts and $8.2 billion in tax increases. Republicans rejected it and instead sought an economic stimulus program.
Schwarzenegger asked for both, offering essentially the same plan rejected last month.
His proposal includes raising the state sales tax by 1.5 percentage points _ or 1 1/2pennies on the dollar _ for three years, generating $3.5 billion in the current fiscal year. He also seeks to increase the annual fee for registering vehicles.
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