JANUARY 9, 2010

By STU WOO and JIM CARLTON

SACRAMENTO, Calif. — Republican Gov. Arnold Schwarzenegger asked for $6.9 billion in federal funds in his state-budget proposal Friday and warned that state health and welfare programs would be threatened without the emergency help.

Mr. Schwarzenegger’s proposed $82.9 billion general-fund budget for the 2010-11 fiscal year would close a $19.9 billion gap over 18 months. In addition to the federal aid, he called for $8.5 billion in cuts and $4.5 billion in alternative funding to balance the budget.

“It’s time to enact long-term reforms that will change the way the most populous state and the federal government work together,” Mr. Schwarzenegger said. He and state legislative leaders plan to visit Washington to lobby for bailout money. White House budget officials weren’t available for comment on the governor’s request.

Mr. Schwarzenegger said that without the federal aid, he would propose cutting $4.6 billion from state assistance programs and raise another $2.4 billion, largely by extending the suspension of tax breaks.

The governor said California deserved the federal help because the state sends far more tax money to Washington than it receives in return. Federal mandates, he added, “force us to spend money that we do not have.”

The budget proposal said the federal government should reimburse California $2.8 billion for costs related to the state’s Medicaid program, as well as more than $1 billion for special-education spending and $2.1 billion in federal-stimulus money.

Mr. Schwarzenegger called the state legislature into a special budget session. He proposed cutting $2.4 billion from health and welfare spending and $1.2 billion from prison spending. He also called for cuts in salaries and pensions for state workers.

Republicans praised the plan. “It’s a good first step,” said Bob Dutton, vice chairman of the state Senate’s budget committee.

State Senate President Darrell Steinberg, a Democrat, said: “I have one reaction: You’ve got to be kidding me.” He and other legislative leaders said they opposed any more cuts to welfare and health programs. Instead, they said they preferred federal help or taxes on, for example, oil drilling and tobacco sales.

“These cuts would come at a bad time because there is growing demand from families who are struggling to make ends meet,” said Jean Ross, executive director of the nonprofit California Budget Project, which studies policy impacts on the poor.

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