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The Assembly
began informational budget hearings December 16 at the state capitol
to explore in greater detail Governor Gray Davis' proposed $10 billion
budget cuts. While the Senate did not schedule hearings of its own,
it did send its chief budget negotiator, Senator Wes Chesbro (D-Arcata),
to represent the Senate at the Assembly's hearings. Representatives
from the Legislative Analyst's Office (LAO) and the Governor's Department
of Finance (DOF) testified before the committee and attempted to
more thoroughly explain the potential impacts and context behind
the proposed cuts.
The LAO released
its "Analysis of Mid-Year Budget Proposal" on December
16, which is available online at
www.lao.ca.gov. The LAO's report contains program reductions
and eliminations, spending deferrals, funding shifts, fee increases,
and reversions of unspent appropriations to the state's General
Fund that coincide with the Assembly budget hearings this week.
The LAO reviews the Governor's proposal and offers some options
for additional revenue as well.
The LAO does
not recommend a repeal of the two Educational
Revenue Augmentation Fund (ERAF) exemptions held by water districts
(multi-county special districts and water wholesalers who are not
primarily flood control agencies) in their December 16 analysis
and recommendations document. Multi-county special districts, the
majority of which are water districts, were specifically mentioned
in early 2002 by the LAO as a potential source of revenue, which
would be gained by shifting $45 million to the state's K-12 and
community college ERAF.
The Legislature
will reconvene on Monday, January 6, 2003 to begin the task of implementing
some level of cuts to the current 2002-03 budget. Governor Davis
is scheduled to release his 2003-04 state budget proposal on January
10. ACWA will provide relevant, in-depth coverage of developments
with the state budget crisis as they occur.
Water districts
with specific state budget questions about media and communications
can contact Jennifer Persike, Director of Communications & Outreach,
at JenniferP@acwa.com.
Technical, content or strategy questions can be answered by Wendy
Ridderbusch, Legislative Advocate, at WendyR@acwa.com
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