California residents fears has been confirmed. During the 2010 California will experience further cuts in health services, education, wages and social assistance programs by more than $8.5 billion.
Days after delivering his sixth and final State of the State report, Gov. Arnold Schwarzenegger unveiled his budget propousal for 2010 and at the same time he declared a fiscal emergency in California.
Schwarzenegger also called on legislators to hold a special session to immediately resolve the budget crisis. California faces nearly $19.9 billion in deficit.
"I know that the budget I have laid out today is difficult and it is painful, but California is resilient, and we know that we will once again get through these tough challenges," said Schwarzenegger.
The governor clarified that there will no be a tax increase this year, however, with the intention to save $1.400 billion, there will be a reduction of 5% in the state workforce. In addition state workers will contribute with 5 percent of their retirement pension.
He also said that once the furloghs of three days per month conclude in June, he plans to reduce state workers salaries by 5 per cent.
He also announced cuts to Medical, the insurance for poor people, and CalWORKS, including the program for elderly and disabled people IHSS. Also announced major cuts to the Healthy Families program.
One of the strategy that Schwarzenegger wants to implement to resolve this crisis is to pressure the federal government for greater reimbursement of state expenditures. California just gets a few amount for every dollar.
"We are looking for fairness. We're not asking the federal government to give us something. It's our money," Schwarzenegger said.