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Page last updated at 14:42 GMT, Wednesday, 20 May 2009 15:42 UK

Californians snub budget measures

A man casts his vote in Pasadena, California, 19 May
Voters were asked to vote on six measures

Californian voters have decisively rejected a series of budget measures aimed at tackling the state's budget deficit, set to top $21bn (£13.5bn).

Gov Arnold Schwarzenegger had warned of deep spending cuts and layoffs if the measures failed to pass.

But voters appeared unconvinced that the plan was the solution for California, which has the eighth-biggest economy in the world.

The only measure to pass was one freezing the pay of elected officials.

'Biggest loser'

As returns came in, Gov Schwarzenegger said he respected "the will of the people who are frustrated with the dysfunction of our budget system".

"In order to prevent a fiscal disaster, Democrats and Republicans must collaborate and work together to address this shortfall," he said in a statement.

The failure of the measures is a blow to Gov Schwarzenegger, according to local political commentators.

"The biggest loser would be Arnold," said Dave McCuan, a politics professor at Sonoma State University.

"It's time to start looking for a cabinet post in the Obama administration or an ambassadorship someplace warm."

"I think he's discovered that this job is a lot harder than he anticipated in a state of economic downturn," said California state treasurer Bill Lockyer.

Voters were asked to consider six measures - five specifically targeted at shoring up the state's shaky finances.

Five of the propositions were set to be defeated by margins of 60% to 65%, local media reported.

These were:

  • Proposition 1A: increases the state's rainy-day reserves, puts a cap on spending and extends recent increases in sales, income and vehicle taxes for up to two additional years
  • Proposition 1B: guarantees education funding but only if 1A passes as well
  • Proposition 1C: allows the state to borrow $5bn against future lottery revenue
  • Propositions 1D and 1E: shift money from child development and mental health programmes to the general fund.

The only measure that won general support, passing by some 75%, was Proposition 1F, which would freeze elected officials' pay in years when there is a budget deficit.

That may be more a sign of growing frustration with lawmakers, the BBC's Rajesh Mirshandani reports from Los Angeles.

Many also feel overwhelmed by elections, our correspondent says.

This was the 12th vote in California in seven years and, despite record numbers in the recent presidential election, only 19% of voters cast a ballot, accoridng to partial results from 70% of precincts.

'Painful cuts'

California, which earlier this year enacted spending cuts and raised taxes to tackle its fiscal deficit, has been hit hard by the recession which has seen tax revenues decline sharply.

Last week, Gov Schwarzenegger warned that tough measures would be needed whatever the outcome of the election.

Gov Schwarzenegger outlines the need for the budget measures
Gov Schwarzenegger says California must sort out its "budget madness"

"To solve our immediate and painful cash crisis, we simply cannot avoid deep and painful cuts in spending," he said.

These include laying off 5,000 state employees and selling off buildings including the Los Angeles Memorial Coliseum, where the 1932 and 1984 Summer Olympics were held.

If the budget proposals failed, Gov Schwarzenegger warned, California's deficit would swell to $21.3bn.

If that happened, deeper cuts would mean the school year being shortened by 7.5 days and an end to health care for 225,000 low-income children.

The state government would take $2bn from local governments, which could have an effect on local police and fire departments, while thousands of undocumented illegal immigrants held in state facilities would be released into federal custody.



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SEE ALSO
California's budget worries grow
18 Feb 09 |  Americas
California approves budget bill
19 Feb 09 |  Business
20,000 jobs may go in California
17 Feb 09 |  Business

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