California Approaches a Deal on Budget Cuts

[midnight armadillo]

http://www.nytimes.com/2009/07/16/us/16calif.html?_r=1&hp

LOS ANGELES — California lawmakers neared a deal on Wednesday with Gov. Arnold Schwarzenegger to close the state’s $26 billion budget gap in ways that would profoundly alter the state’s relationship with its cities and millions of residents who receive basic services.

Details emerging from the talks suggested that the deal would require extraordinarily deep cuts to school systems and local governments, and, while far smaller than the governor threatened a month ago, substantial cuts to health care and other social services.

...

While the state’s health care program for poor uninsured children will not end, as the governor once threatened, its enrollment will probably be limited, state officials said, meaning that some children will be on a waiting list for health care. Medicaid recipients will probably be moved into a managed-care program. Further Medicaid cuts seem unlikely, as they would put the state in violation of federal standards.