Budget negotiations are stalled

July 16, 2009 7:26:06 PM PDT
Just when leaders were about to close in on a compromise, Democrats demanded changes to a voter-approved law so that public schools could get back roughly $11,000,000 dollars in cuts when the economy rebounds.Arnold Schwarzenegger, California Governor said "It's a Constitutional change, and it can only be changed by the people. They are more than welcome to make that change and ask the people. But we will not do that in-house. That's where it's stalled."

Another delay in reaching a compromise infuriated State Treasurer Bill Lockyer.

In a scathing letter to the Governor and Legislative leaders, he told them: "To stop using budget negotiations to score points with political allies or against partisan opponents."

He went on to say Wall Street is running of patience with California's budget problems and that every day that passes, pushes the state closer to junk bond status.

Lockyer said junk bond status would cut off access to financing of roads, schools and other public works projects, it's already expensive for California to borrow.

Joe Eschleman, Wells Fargo Advisors said "The BAA1 rating of California is actually the lowest of a state has ever been rated. It's actually the only time a state has ever been below A-rating before."

The Basra Family is on pins and needles, wondering about the state budget.

Because of the impasse, Healthy Families, which is state-funded health care for uninsured kids, will start to put people on a waiting list as of tomorrow.

The Basras are worried about their three children, all of whom have medical issues.

Amir Basra, concerned father said "Yeah, very, very worried. I applied two weeks back and never got a call back from them."

Noreen Amir, concerned mother said "They are risking the health of the kids. So how can they do that?"

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