May Revise Preview: Borrow, Borrow, Borrow!

by Robert in Monterey [courtesy of Calitics - Front Page]

The AP has gotten a hold of the governor's May Revise speech and therefore the major budget proposals that are to be unveiled tomorrow. The key elements are described below and over the flip I provide my immediate analysis.

• Arnold will float bonds using the state lottery as security. $15 billion over 3 years will be raised but $10 billion goes into "rainy day fund"
• If that fails, 1% sales tax hike to last no more than 3 years
• Prop 98 suspension abandoned; instead COLA will not be paid
• State parks closures abandoned; instead fees to rise $1 to $2
• $6 billion still left to cut or balance out somehow."

Analysis below...