* Financially strapped state faces $25.4 billion deficit
* Brown proposes cuts to state worker pay, social services
* Voters could decide on extending expiring tax hikes
SAN FRANCISCO (Reuters) - Governor Jerry Brown is
set to press California lawmakers in his state-of-the-state
address Monday to balance the state budget with $12.5
billion in spending cuts and $12 billion in tax hikes.
California, the most populous U.S. state, faces a $25.4
billion deficit caused by the combined effects of recession,
high unemployment and turmoil in financial and housing
Analysts expect the 72-year-old Democrat to stress
austerity and urge lawmakers to help him prepare a ballot
measure for a special election in June asking voters to extend
tax increases scheduled to expire this year.
California has the largest budget deficit of any of the 50
U.S. states in dollar terms, although not as a percentage of
Brown, sworn in as governor this month, unveiled a budget
proposal on Jan. 10 that included cuts to state worker pay and
social services and the plan to extend tax increases.
The governor is gambling that his budget plan will get
voters to accept tax increases -- an issue other hard-hit state
governments around the United States are sure to watch.
"He's going to pose a stark choice: His plan, which is
harsh, and doing nothing, which is worse," said Jack Pitney, a
professor of government at Claremont McKenna College in
Brown will reiterate in his speech Monday his previous
calls for shared sacrifice to repair the state government's
finances, an aide said Friday.
Under Brown's plan, revenue from the tax extensions,
proposed spending cuts and other measures would help balance
the state budget in the near term and bolster the state
government's finances in future years.
Without the revenue, lawmakers and the governor would have
to find another $12 billion in spending to cut.
Brown is scheduled to make the state-of-the-state speech at
5 p.m. Pacific timeMonday (8 p.m. Eastern Time
Monday) in the state capital Sacramento.
(Reporting by Jim Christie; Editing by Will Dunham)
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