Schwarzenegger on State of the State: Troubled

State Senate leader Darrell Steinberg (D-Sacramento) criticized the "rollback of environmental and consumer protection laws" in Schwarzenegger's jobs package, a linchpin of his agenda. Schwarzenegger would shield some big construction projects from lawsuits over environmental regulations, but Steinberg said he should first use $3 billion in voter-approved borrowing and additional federal stimulus funds that are "stuck collecting dust in the bureaucracy."Fellow Republicans lauded his economic plans, which included allocating $500 million to train workers, but were skeptical about Schwarzenegger's proposals for a constitutional change that would require more spending on higher education than on prisons.... The $20-billion deficit now projected through mid-2011 is similar to the one that took months to close last year and forced officials to issue IOUs. The governor and lawmakers have even fewer options now because many programs have already been cut drastically.

the Legislative Analysts Office report predicts that the state will already be suffering from a $6.3 billion dollar deficit during the 2009-2010 budget year, before the new budget is enacted.... According to the LAO report, the 2009-2010 budget has a $6.3 billion deficit and the 2010-2011 has a $14 billion projected deficit. This means that the Legislature will need to address $20 billion in budget solutions before anything else. The budget produced by the Legislature and Governor last year assumed certain budget savings that were never realized. Specifically, the prison system and Medi-Cal were unable to achieve billions of dollars in expected savings. Basically, the Legislature made unrealistic assumptions about how much money in savings could be achieved from these programs in the short term, without making the sweeping changes necessary.