With one cliff hanger after another, state officials maintained high anxiety over the state budget until the last minute. Previews of what might come left many with a sick feeling.
The Governor and legislators had issued many threats over recent weeks grim threats of cuts in firefighting, law enforcement, education, social services. Plus, the threat of IOUs that would go to counties and other state-funded services.
The State Controller John Chiang said IOUs would signal fiscal mismanagement. Chiang also said that thousands of Californians will be hurt and it will cost millions if the state has to hand out IOUs instead of payments this week. At last word, legislators remained deadlocked on a budget bill.
The outspoken controller went on to say, Running the state off the cliff is no way to make a political point. I dont want shock and awe. I want permanent solutions. Bottom line, if the legislature does not okay a new budget, IOUs will go out.
If that happens, sources say, college students who expect grants, disabled people and low-income seniors may not get paid. Vendors that provide services to the state and counties that run social service programs could also miss out on payments. This state problem could hit Inyo and Mono county services, Caltrans, DMV, and Fish and Game.
If the state has enough cash in October, the state treasurer will pay the IOUs with interest.
Legislators were meeting through the night to resolve the mess.