It appears that a California budget deal has been struck at last. It sounds much like King Solomon actually sawing the baby in half.
Sacramento Bee
Gov. Arnold Schwarzenegger and legislative leaders agreed Monday to balance Californias $26 billion deficit by cutting broadly across state government, shifting costs into the future and capturing funds from cities and counties.
State leaders believe their budget plan is credible enough to acquire billions of dollars in short-term loans that will end the states reliance on IOUs for only the second time since the Great Depression. California is in the throes of a cash shortage because it is relying on a February spending plan that assumed higher revenues and solutions rejected by voters in May.
The proposal includes spending cuts to programs ranging from schools to welfare-to-work to prisons. It takes money from local governments, including borrowing $2 billion that the state will repay starting in 2013 and taking gas taxes that normally go toward local road projects.
This sounds like more of the kick the can down the road. They are borrowing money from future years. They are taking money from other jurisdictions. They are looking for more loans.
You can expect a lot of their cuts to lead to court cases. The track record for the state on those so far has not been good. The courts will order them to restore the cuts and then the budget will come unraveled all over again.
The chaos is just beginning.