Budget proposals

Among noteworthy actions proposed by Gov. Arnold Schwarzenegger on Thursday are:

• Close 48 of the 278 state parks and reduce by at least half the number of lifeguards at state beaches in Orange, San Diego and Santa Cruz counties.

• Reduce per-student spending in California schools by $309 a year.

• Reduce support for universities, likely requiring California State University trustees to restrict enrollment and raise fees by at least 10 percent.

• Reduce the number of corps members in the California Conservation Corps from 1,310 to 1,235.

• Place a 1.25 percent surcharge on homeowners and commercial property insurance, with revenues dedicated to firefighting services.

• Eliminate dental coverage for the approximately 3 million adults who rely on Medi-Cal.

• Eliminate cost-of-living increases for the aged, poor and disabled who receive $870 per month benefit checks under Supplemental Social Security.

• Release 22,159 inmates from prison 20 months earlier than their sentence provides.

• Release 18,522 parolees from active supervision.

• Eliminate 1,900 shelter spaces for the homeless under the Emergency Shelter Program.

• Reduce the number of the Department of Fish & Game wardens from 370 to 332.

• Increase by $11 per vehicle the portion of the registration fee that supports the California Highway Patrol.

SACRAMENTO — Faced with a $14 billion state budget shortfall over the next 18 months, Gov. Arnold Schwarzenegger on Thursday proposed a breathtaking menu of spending cuts that calls for granting early release to more than 20,000 prison inmates, closing 48 state parks, refusing dental care to adults on Medi-Cal and reducing spending on schools by about $300 per student.

Those cuts are part of more than $9 billion in spending reductions from a 10 percent across-the-board cut that exempts almost no one: not prisons, not schools, not the governor's office itself.

"We are facing a very tough situation," Schwarzenegger said as he released his proposed $101 billion spending plan for the 2008-09 fiscal year. "It will reduce almost every state program by 10 percent next year. We don't favor one department over another."

Although the budget proposes an $11 increase in vehicle registration fees, a surcharge on property insurance that will cost each homeowner about $12 a year and another round of college tuition increases, Schwarzenegger ruled out any general tax increase to help close the deficit.

"You cannot tax your way out of this problem. No way," he said.

Leaders of the Democratic-controlled Legislature assailed the governor's approach as one that fails to establish priorities and contains no vision of what the state needs to provide the level of services Californians want.

'Cuts alone will not work'

"What is sold as an across-the-board cut comes across as a below-the-belt hit," said Assembly Speaker Fabian Nuñez, D-Los Angeles. "It's a straitjacket that ill fits California and the needs of the people we represent."

Nuñez said lawmakers must take a more creative approach in crafting a spending plan, one that will also consider such alternatives as closing tax loopholes and eliminating tax subsidies for the wealthy.

"All of the cards ought to be on the table," he said. "Cuts alone will not work."

In addition to his proposal to cut more than $9 billion from next year's budget, Schwarzenegger is seeking a reduction of more than $800 million in current year spending. On top of that, he proposes to sell $3.3 billion in already authorized deficit-reduction bonds in order to get the state through the end of the fiscal year.

'The villain is the budget'

The governor declared a fiscal emergency, which will force the Legislature to take action within the next 45 days to cut spending in the current year. Without such action, there is a danger the state could run out of cash to pay its bills by late spring.

The crisis arrives even though the state budget approved in August included a $4.4 billion reserve. But tax revenues have come in well short of projections, wiping out that reserve and then some.

Schwarzenegger said the flattening of revenues is largely the result of the housing slowdown and the subprime mortgage crisis. But he did not blame the state's fiscal crisis on outside factors.

"The economy is not the villain here," Schwarzenegger said. "The villain is the budget."

To accomplish the cutbacks in education spending, Schwarzenegger proposes to suspend the Proposition 98 guarantee for school funding, a move that would result in schools receiving $4 billion less than what they are entitled next year and nearly $3 billion less than what they will actually receive this year.

Superintendent of Public Instruction Jack O'Connell said the proposal would change what Schwarzenegger once promised would be the "year of education reform" to the "year of education evisceration."

O'Connell noted a national report card of public school systems issued this week gave California a D-plus in school funding.

"The governor's budget takes a giant step backward," O'Connell said. "California's student population is the most challenging in the nation with more than half our students coming from families that are struggling economically and a quarter learning the English language. We simply need to invest more — not less — in preparing these students to succeed."

Inmate release criticized

Republican lawmakers generally praised Schwarzenegger's slash-spending approach but assailed the idea of reducing spending on prisons by allowing the early release of 22,159 inmates.

"That's probably not well thought out," said Senate Republican leader Dick Ackerman of Irvine. "It will put public safety at risk."

Administration officials said only nonviolent, nonserious, nonsex offenders without prior serious or violent offenses would be eligible. They would be released 20 months earlier than their original release dates. The move would save $256.4 million and allow for the elimination of 4,194 jobs, mostly of prison guards.

Schwarzenegger said he was making the recommendation not solely out of concern for cutting the budget but also to try to avert a judicial takeover of the critically overcrowded state prison system.

"The federal judges are breathing down our neck," he said. "It happens to be at the same time when we have a budget problem and want to make across-the-board cuts."

Could force raise in tuition

Colleges and universities would not be spared the ax.

Schwarzenegger proposes to cut funding to the University of California by $331 million, to the California State University by $313 million and to community colleges by $483 million.

The proposal does not seek an increase in community college fees but notes the cuts could force the four-year universities to raise tuition even more substantially than had already been contemplated.

UC regents had anticipated a 7.4 percent increase and CSU trustees a 10 percent increase. "It is possible," the administration's budget summary says, "that the regents and trustees will act to increase fees beyond these levels."

Assemblyman Pedro Nava, D-Santa Barbara, said the intent of Schwarzenegger's proposals may be to force Californians to focus on the state's fiscal problems.

"I can't believe the governor thinks the people of California are going to support the suspension of Proposition 98 and the closing of parks," Nava said. "I just don't think that he believes that's palatable."

Legislative Democrats, who have been stymied in recent years by their Republican colleagues' steadfast refusal to consider tax increases of any kind, said the scope of the proposed budget cuts will likely cause Californians to put pressure on lawmakers to come up with different solutions.

Because it takes a two-thirds vote to approve a budget, minority Republicans have been able to cut off any discussion of increasing taxes or closing loopholes.

"What you're seeing today is the rhetoric being put into reality," said Assemblyman John Laird, D-Santa Cruz, chairman of the Assembly Budget Committee.

"That reality will seep through, and after a while it's going to be hard for anyone to just respond with rhetoric."