Governor: More budget slashing needed

SACRAMENTO — Gov. Arnold Schwarzenegger said Tuesday that he vetoed the largest piece of legislation in a package of budget bills because it did not take immediate steps to cut spending.

Democratic lawmakers said the bill would have shaved $2.1 billion from the $20 billion shortfall projected for California's budget through June 2011. So far, the Legislature and governor have agreed to just $200 million in spending cuts.

"It's extremely important that we immediately jump into action and make midyear cuts," Schwarzenegger told reporters on Tuesday. "We're spending, right now, $600 million a month more than we're taking in. It's irresponsible."

Schwarzenegger vetoed the Assembly bill Monday evening. He explained Tuesday that the bill targeted potential cuts in the fiscal year that begins in July, but he wants those cuts to be made in the current fiscal year.

"I know this is very tough," Schwarzenegger said. "I know this is difficult for some of the programs that we have — education, higher education, health care and so on — but we have to make those cuts, because we don't have the money to pay for those things."

GOP lawmakers from the Mid-Valley region agreed with the veto, with Assembly Budget Committee Vice Chairman Jim Nielsen, R-Gerber, saying he'd made similar points.

"It did not deal with any structural changes in ongoing spending," said Nielsen, who added he'd also voted against the bill before it moved onto the governor.

Particularly glaring, he said, was the failure of the bill to address costs from illegal immigration on prison spending.

Assemblyman Dan Logue, R-Linda, said too much of the budget focuses on growing government, not growing jobs. "All the bill does is shuffle money and defer payments," he said, adding he also didn't support the bill. "We've got to live within our means."

Bill Bird, a spokesman for state Sen. Sam Aanestad, R-Penn Valley, said the bill didn't touch the biggest areas of state spending enough: education and health and human services.

"The majority party rejected that," Bird said of $5 billion in spending rejections Aanestad and other GOP state senators backed. "Every single program must be on the table."

He added Aanestad had also voted against the bill: "We may be right back to square one now, or half a square if the deficit grows."

In January, Schwarzenegger called the Legislature into a special session to slash the state's deficit by $8.9 billion, primarily through cuts to public schools, higher education and social services. But Democrats refused to make the deeper cuts he requested.

As part of the special session, the Legislature was required to focus on budget bills. If lawmakers did not send the governor a budget solution for the current fiscal year by Feb. 22, they would not be allowed to take up regular session bills. The Legislature met that requirement when it passed a measure authorizing payment deferrals that would ensure the state has enough cash to pay its bills.

Appeal-Democrat reporter Ben van der Meer contributed to this report.