Southern California -- this just in

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California officials aren't counting on federal aid

May 22, 2009 | 12:15 pm

The state’s top financial officials warned lawmakers this morning that California should forget about getting federal backing for the emergency short-term loans it needs to keep paying its bills later this year — and that the cash crisis could be four times worse than it was earlier this year.

 In a bleak assessment delivered to a panel of lawmakers grappling with ways to cut a state deficit expected to exceed $24 billion, state Treasurer Bill Lockyer warned that the state needs “a budget investors believe in” by late June to have any chance to tap the credit markets for the cash.

He and state Controller John Chiang told the 10-person joint legislative committee that the state likely will have to limit its borrowing to $10 billion or less because of the wariness of post-meltdown credit markets and the state’s precarious fiscal straights.

Read the rest of the story here.

--Eric Bailey