Calif. Budget Plan Cuts Programs To Trim Deficit

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California Governor Jerry Brown and legislative leaders have reached a deal on the state's budget. The plan includes deep cuts to social programs. It would also knock three weeks off the school year unless voters approve new taxes proposed by Brown.

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STEVE INSKEEP, HOST:

NPR's business news starts with a budget deal in California.

(SOUNDBITE OF MUSIC)

INSKEEP: This deal comes just days before the start of the new fiscal year. It cuts social programs and it would knock three weeks off of Californian's school year unless voters approve a proposal for new taxes.

Capital Public Radio's Ben Adler reports from Sacramento.

BEN ADLER, BYLINE: The Democrats running this year's California budget process say they have one overarching goal: to bring years of festering shortfalls to an end.

Senate Leader Darrell Steinberg says this deal will do just that.

STATE SENATOR DARRELL STEINBERG: We are on the back end of this thing. We are on the back end of this deficit. And if we pass those taxes in November, we will really be starting, I believe, a new chapter here in California.

ADLER: A chapter that would include higher income taxes on the wealthiest Californians and higher sales taxes for everyone. Even then, budget reductions will include cuts to child care subsidies, in-home medical care, college financial aid, and state worker compensation.

A program that provides health care subsidies to nearly 900,000 low-income children will vanish, with the kids being moved to California's version of Medicaid. And then...

UNIDENTIFIED MAN: Holy and loving God, we pray for this great state of California...

ADLER: A new two-year limit for welfare cash grants, which drew prayers from protesters outside Governor Jerry Brown's office. But the welfare cuts could have been worse. Brown had also proposed reducing grants for long-term unemployed parents.

Mike Herald is with the Western Center on Law and Poverty.

MIKE HERALD: I guess you would call it a split-the-baby approach maybe, or a halfway approach. But I think for families who are going to have to meet these new work requirements, they're going to end up getting the short end of the stick.

STATE SENATOR BILL EMMERSON: It's a step backward from the very successful Clinton welfare-to-work programs of the 1990s.

ADLER: Republican Senator Bill Emmerson says he's disappointed the welfare cuts weren't deeper. As for overall spending plan...

EMMERSON: We're continuing the tradition of budgeting by gimmicks and taxes.

ADLER: Meanwhile, there's been hardly a peep from the normally talkative Governor Brown. That will almost certainly change in the coming months, as he works to build support for his November tax measure.

For NPR News, I'm Ben Adler in Sacramento.

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