Tags: Schwarzenegger | tax | hikes

Schwarzenegger Recommends Deep Cuts, Tax Hikes

Wednesday, 29 Oct 2008 07:53 AM

SACRAMENTO ? Calif. Gov. Arnold Schwarzenegger is expected to call lawmakers back to a special session to deal with a worsening budget crisis after the election, and he may be poised to make deep cuts and call for a hike to the sales tax to fill the widening financial gap.

The governor reportedly told a group of education leaders on Tuesday to expect big cuts to the school system to help cover the projected shortfall of five to eight billion dollars. He also told them a sales tax increase could be on the table.

"If you look at any district's budget, 85 percent is personnel," said Brian Lewis of the California Association of School Business Officials. "You can't touch that because those contracts are in place, so you're talking about those 15 percent around the margin… there's no margin left."

The Governor's press secretary says it's too early to talk specifics, but said that "hard decisions" will have to be made to solve the problem.

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