California governor would slash 10,000 vacant state jobs to help close $27.6 billion deficit

SACRAMENTO, Calif. (AP) — California has a budget deficit of $27.6 billion, Gov. Gavin Newsom announced Friday — a gap so wide that he’s proposing eliminating 10,000 vacant state jobs and cutting spending across 260 state programs.

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Photo by Anne Wernikoff for CalMatters

The Democratic governor outlined the deficit Friday as part of his proposed $288 billion state budget for the fiscal year that starts July 1. That’s by far the largest budget of any state.

One-time cuts would include $2 billion for broadband that would have expanded broadband connections, $272 million for employment services for the state’s welfare program, and $500 million for water storage in the drought-plagued state. He said those water storage cuts would not directly impact the controversial tunnel project in the Sacramento-San Joaquin Delta that he has long supported.

Continuing cuts would save another $81 million by closing housing units with 4,600 beds across 13 state prisons, and remove $300 million in pandemic-related help for state and local public health departments. Ongoing spending for a scholarship program for middle class college students pursuing a teaching credential would be cut by $510 million. He also wants to suspend the widely used net operating loss tax deduction for businesses.

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“These are programs, propositions that I’ve long advanced — many of them,” Newsom said as he began outlining his budget. “But you’ve got to do it. We have to be responsible. We have to be accountable.”

The deficit is smaller than the $38 billion Newsom predicted in January, but that’s because it doesn’t include $17.3 billion in cuts and other actions he and lawmakers already agreed on to help close it. Otherwise, it would be closer to $45 billion.

This is the second year in a row the nation’s most populous state is facing a multi-billion dollar shortfall. State revenues have continued to fall amid increasing inflation and a slow-down in the state’s normally robust technology industry. Through the end of April, state tax collections from its three biggest sources — personal income, corporations and sales — dropped more than $6 billion below the previous estimate.

Newsom, now in his last term as governor and widely seen as a future presidential candidate, says his plan will address both this year’s deficit and a projected $28.4 billion deficit for the following year. He plans to outline more than $32 billion in cuts to make that happen so that the state Legislature can must pass a spending plan by June 15.

He described it as “appropriate and prudent for us not to just solve for this year but to also solve for next year.”

Democratic legislators applauded Newsom’s effort to deal with multiple years of deficits and vowed to protect spending for social safety net fundings and classrooms.

“Nobody knows what challenges California may face, so we must always stay prepared,” Assembly Speaker Robert Rivas and Assembly Budget Chair Jesse Gabriel said in a joint statement.

Republicans, however, said Newsom has failed to responsibly manage the state’s spending.

“California’s budget situation is a mess,” said Republican Assemblyman Vince Fong, vice chair of the chamber’s budget committee and a congressional candidate. “I have said repeatedly that budget gimmicks, cost shifts and more borrowing only creates more problems in the future.”

Newsom and the non-partisan Legislative Analyst’s Office have disagreed on the true size of the state’s deficit this year. The LAO said in January that the deficit was actually $58 billion when including some reductions in public education spending. The LAO will release its own new estimate next week, and it will likely be larger.

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Comments

  1. Rico Lagattuta says

    Slashing 10,000 vacant job positions from the budget is not a savings. They are just non-funded items. These positions were never really needed. They were just paper items that were never really meant to be filled. Read “Personal Opinions of One Common Man” due out on Amazon soon.

    • Leo of Sacramento says

      Sorry Mr Rico, these so called, ‘vacant positions’ were indeed, funded. Any position seems to be funded, whether manned or not. Typically, Government allows for 10% shortage of staff…….these ‘funds’ are then used for Overtime payments without impacting their regular budgets, amongst other things.

      How long has/have 10K vacant spots been allowed, is one question. How long have WE the tax payer, been overpaying these organizations, is another question.
      Sacramento County is a good if not great example, of abusing this system of keeping open positions from getting filled, so Management can use these funds as they see fit.
      Believe me, you’ve BEEN paying for them. These are the ones that are announced.
      For the REAL numbers, the questions should be:
      1) How many positions are available for XX department;
      2) How many bodies are filling the current positions?
      3) There are your real numbers.

      June will be the REAL budget numbers that come out……..may revise?? pfffffffttttttttt
      smoke and mirrors.

      Read the article on the following:

      San Fran organization gets 20 MILLION over 4 years, to help 55 people, by giving them nurse administrated Booze shots to keep homeless alcoholics off the streets;

      AMAZING.

  2. Donald J. says

    260 State Programs? That seems like a small amount considering how every time we turn around some tax and spend program has their hand in our pocket. This whole downhill slide of California lies directly at the feet of those who aided and abetted the past and present government gangsters in office.

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