California Gov. Arnold Schwarzenegger (R) on Friday signed five bills into law that allow California to receive more than $17.5 billion in federal economic stimulus aid, but the funding will not be enough for the state to avoid $3 billion in tax increases and cuts to services to balance its budget, the San Francisco Chronicle reports.
The legislation changes eligibility reporting requirements for children enrolled in Medi-Cal and allows more people to qualify for unemployment insurance and extends the benefit by 20 weeks. Medi-Cal is the state's Medicaid program.
State Treasurer Bill Lockyer and Department of Finance Director Mike Genest on Friday said that the state will receive $8.2 billion in stimulus funding for the general fund (Yi, San Francisco Chronicle, 3/28). However, the state's recently enacted budget was contingent on receiving $10 billion for the general fund. As a result of the lower funding, the state will increase personal income tax rates by 0.25 percentage points and government services will be cut by an additional $948 million (Bailey, Los Angeles Times, 3/28).
The cuts will eliminate medical services such as dental care, eye exams, podiatry, chiropractic services and speech therapy. Medi-Cal reimbursements to public hospitals also will decrease by 10% (San Francisco Chronicle, 3/28).