Governor Signs Budget, Makes More Cuts

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Gov. Arnold Schwarzenegger signed the state's $85 billion budget into law Tuesday, making further cuts to build the state's reserve fund, but leaving the Cal Grants program's funding untouched.

To close the state's $26 billion deficit, the governor made another $656 million in cuts through vetoes of spending on health care and social services.

The signed budget includes a reduction of state spending on education by $9.3 billion, health and human services by $3 billion and government spending by $1.7 billion.

Schwarzenegger's additional cuts will affect the California Student Aid Commission, which administers Cal Grants.

But the commission, which will see a $6 million cut to its operation fund, will not reduce any funding for the Cal Grants program, said Yvonne Stewart-Buchen, spokesperson for the commission.

The commission could have the cuts reduced by $4 million if it follows the governor's proposal to decentralize.

UC President Mark Yudof praised the preservation of Cal Grants in a statement.

"Access to UC for low-income students would have been threatened if the state had reduced or eliminated Cal Grant funding," Yudof said.

Cuts will deeply impact health and human services programs catered to low-income Californians.

Healthy Families, the state program that provides health insurance to children from low-income families, will receive a $178.6 million cut.

In response, Healthy Families, which provides health insurance to 920,000 children, will begin to dis-enroll children from its program starting Oct. 1.

Children whose health insurance expires in September will no longer be eligible for insurance renewal, potentially leaving many children without insurance, said Ginny Puddefoot, deputy director for health policy legislation and external affairs at the Managed Risk Medical Insurance Board.

"This is a very hard day, a very difficult time," she said. "We are doing everything we can to help them with identifying alternate sources of care."

The Office of AIDS Prevention and Treatment, which provides AIDS education, counseling and housing program services, also faces a $52 million cut from the governor's veto.

These service reductions could result in more people contracting HIV because of a lack of information, and low-income people with HIV losing their housing, said Alice Kessler, government affairs director for Equality California, a non-profit organization dealing with LGBT issues.

"What the governor did completely dismantled 20 years of innovation done in the state of California for people with HIV," Kessler said.

The governor said in a press conference that the financial crisis is not over, and that the budget could be revisited if further cuts are necessary.

"We are ready, if our revenues drop further, to go and make the necessary cuts in order to again live within our means," he said.


Contact Paul Edison at [email protected]

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