California May Delay Tax Refunds Amid Budget Iimpasse

[Purveyor]

Source: LA Times

By Jordan Rau and Evan Halper
January 7, 2009

Reporting from Sacramento -- State officials on Tuesday braced for the possibility of delaying tax refunds to millions of Californians, along with student grants and payments to vendors, as the latest round of budget negotiations between Gov. Arnold Schwarzenegger and Democratic legislators collapsed.

With little more than a month's worth of cash left in the state treasury, the governor and lawmakers have been unable to agree on how to erase a budget gap projected to reach $41.6 billion by the middle of next year. Democrats announced Tuesday that two weeks of discussions had ended in an impasse and sent Schwarzenegger the $18-billion fiscal package they passed last month. The governor vetoed it, as he had promised to do.

State Controller John Chiang has said that as early as Feb. 1, his office may begin issuing promissory notes if lawmakers have not resolved the budget crisis. The state has done this only once before since the Great Depression -- in 1992.

"We have not made any decision about deferring payments or using IOUs, but they are possibilities if the governor and Legislature don't come to some agreement soon," Chiang spokeswoman Hallye Jordan said Tuesday.

Under the state Constitution, schools and bondholders get first rights to any cash in the state's coffers.

Read more: http://www.latimes.com/news/local/la-me-budget7-2009jan07,0,7686031.story

[mikelgb]

1. ok I'll delay paying my last installment

[RUMMYisFROSTED]

2. We hardly knew ye, Gray.

[NV Whino]

3. Let's see, has Arnie given up his salary yet?

[bunnies]

4. Imagine if taxpayers sent IOUs instead of money...

They'd be in jail.

[Javaman]

5. oh this won't go over well. nt

[nc4bo]

6. Right or wrong, many people depend on their refunds for necessities or catching up on bills

or for a little vacation time or household splurge.

I can't see this going over too well either.

[LeftyMom]

7. Can I IOU my landlord then?

Because I'll have to if they delay my student aid.

[taught_me_patience]

8. Sounds like grounds for a class action law suit

Tax refund is my money that the state overcharged me throughout the year. Not giving it back constititues theft in my opinion.

[nc4bo]

9. They'll be blaming you (and other taxpayers).

It's clearly all of your faults for paying more than was necessary. It's their money now mua.ha.ha.ha.

:sarcasm:

[taught_me_patience]

10. And since we live in CA

we are all millionaires so it's no big deal

:sarcasm:


IOU's don't pay the bills

[Juneboarder]

11. Can we charge the state penalties and interest

for monies paid via IOU?

Damn politicians need to get their acts together and give up their own high salaries before the entire state suffers...

[WhiteTara]

12. hopefully this will end the boobengroper's

senate bid plan.

[rvablue]

13. This is a good idea......but should only be applied to people who bought their houses before 1990.