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Arnold Schwarzenegger to call for deep spending cuts, plead for U.S. aid

January 8, 2010 |  6:00 am

Gov. Arnold Schwarzenegger will present the final budget of his governorship later this morning, calling for deep cuts to public transit, healthcare and social services, as well as pleading for billions of dollars in help from Washington to close California's roughly $20-billion deficit.

The Republican governor will renew his call to expand oil drilling off the Santa Barbara coast and extend the payroll cuts that have resulted in furloughs and a 14% salary cut for more than 200,000 state workers.

Mostly, Schwarzenegger will deliver bad news as cash-strapped California continues to muddle through the economic downturn, despite raising taxes and cutting back services severely in 2009.

"As bitter as the words are in my mouth, we face additional cuts," Schwarzenegger said in his State of the State speech before lawmakers Wednesday.  "We know what that means. We know the pain it entails. I mean, what can we say at this point except the truth, that we have no choice?"

Schwarzenegger vowed this week to "protect education funding" after two years in which billions of dollars were sliced from college and K-12 funding. But the governor has not said if that means more cuts to schools are out of the question, as he provides details of the budget today.

That has school advocates continuing to fret. "We're very heartened that he made that promise," said Jo A.S. Loss, president of the California State PTA. "And we will be very diligent to make sure that happens."

The governor will call for $8 billion in aid from Washington. If the funds don't come through, he will propose the wholesale elimination of CalWorks, the state's main welfare program, as well as a program that provides in-home care to the elderly and disabled.

Corporate tax breaks approved recently also could be rolled back. The proposed budget is just the first salvo in months-long negotiations to produce a spending plan that must be approved by two-thirds of the Legislature.

-- Shane Goldmacher in Sacramento

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