SavageOrangeJug
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SACRAMENTO, Calif. Gov. Arnold Schwarzenegger is making another $656 million in cuts to build a reserve fund for California as he signs the state's new budget. Schwarzenegger cut spending on child welfare, health care for the poor and AIDS prevention Tuesday. He signed a package of bills aimed at balancing the state's $85 billion budget through June 30, 2010.
Schwarzenegger says the plan forces California to live within its means, but it makes severe cuts to government programs from schools to prisons.
The governor and lawmakers came up with a revised spending plan last week to close a $26 billion deficit. They hope it will allow the state to stop issuing IOUs.
The governor wanted a cash cushion after the Assembly rejected about $1.1 billion in revenues from local transportation funding and new oil drilling
THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP's earlier story is below.
SACRAMENTO, California (AP) Gov. Arnold Schwarzenegger on Tuesday is expected to use his line-item veto power to make additional cuts to California's latest spending plan a move advocates fear could further hurt the poor.
Social service advocates worry the Republican governor has little choice but to go after money counties receive to administer welfare and social service benefits as he seeks to restore a reserve fund for the state. Likely targets include welfare-to-work assistance, in-home support, foster care and health insurance for poor families.
With much of state spending tied up by federal and constitutional requirements, the Schwarzenegger administration wants to ensure the state has a cash cushion in case of emergencies such as earthquakes and wildfires.
"I just want to assure everyone that we will build up our reserve. We will make the necessary cuts," the governor said Friday in announcing he would sign the budget passed by the Legislature.
California budget cuts