State Worker columnist Jon Ortiz gives the specter of 7,000 state layoffs a new perspective in this morning's column. In the past, he says, announced layoffs resulted in few jobs actually being lost. Six years ago, 9,100 jobs were eliminated but -- through transfers, demotions, retirements and the like -- only 291 employees lost their jobs. The same thing is happening again, a Legislative Analyst Office spokesman said.

A Democratic senator has questioned whether the governor's furlough is cost-effective after the Franchise Tax Board and Board of Equalization acknowledged the furlough will cost the state $350 million in revenue, The Sacramento Bee reports. The report prompted one state worker, facing foreclosure, to comment, "The third furlough day is killing people." In a separate development, Sen. Dianne Feinstein asked the governor to stop the furloughs for state employees who review Social Security disability applications.

ACSS Secretary-Treasurer Terry Sutherland is quoted in State Worker columnist Jon Ortiz's article Sunday revealing that state retirements rose 13 percent in the first half of this year compared with the same period last year. Sutherland, a CPA with the Franchise Tax Board in the Bay Area, says that with the reduction in pay from the furloughs he will make more money as a retiree. "I just can't afford to subsidize my job any more," he says. He will retire in November.

A Sacramento Bee editorial this morning supports greater scrutiny of the state's contracts with private vendors. Although the newspaper does not support doing away with outside contracting, it does support requiring contractors to report their reasons for issuing contracts (as proposed in AB 756, which SEIU supports). You can look up any state contract over $5,000.

CalPERS has sued Gov. Schwarzenegger and other state officials saying the furloughs are jeopardizing CalPERS' ability to service California's retirees. The suit claims furloughing CalPERS workers does not save the state money because employees are paid from internal sources. CalSTRS did not sue but did ask state Controller John Chiang for relief from the furloughs.

WhenState Worker columnist Jon Ortiz asked for specifics on the governor's layoff plans, he got more than he'd expected: A spreadsheet showed not 7,000 layoffs but as many as 12,000. Ortiz lists the reasons the governor would probably choose more layoffs over a fourth furlough day to cut more costs.

In a letter to California's congressional members, CalPERS is urging Congress to quickly overhaul the nation's health care system, The Sacramento Bee reports. Without reform, the letter, signed by CalPERS President Rob Feckner and CEO Anna Stausboll, said, "we will not be able to sustain our health care system." CalPERS is the nation's second-largest buyer of health care services. The CalPERS press release is here.

A Sacramento Bee editorial reports that a top CalPERS official is calling the state's pension plan costs "unsustainable."

Legislators will vote Thursday on a plan back by Gov. Schwarzenegger to reduce the state's inmate population by 27,300. Included in the package are proposals to reduce some property crimes to misdemeanors, placing low-level parolees on GPS monitoring and sending inform prisoners to medical facilities or house arrest. The move would save the state $1.2 billions, the Sacramento Bee article reports.

Gov. Schwarzenegger has revived his proposal to create a two-tier system for state retirement that would give lower benefits to new hires (current employees' retirement benefits would not change). With CalPERS and CalSTRS struggling financially, the governor may now gain a foothold for this idea, which has been consistently defeated in the past. At least 10 states have cut benefits for new hires, the Sacramento Bee article reports.

Associated Press reports this morning that, despite the budget crisis, at least 87 Assembly staff members and nine Senate staffers have received raises this year totaling well over half a million dollars. Some of the increases were more than 20 percent. In some cases, the increases were given to compensate for extra hours of work, spokespersons said.

State Controller John Chiang announced yesterday that California will not only stop using IOUs for payments beginning Sept. 4 but will also redeem IOUs with interest that day. The move will end a "shameful chapter in our state's history," he said.

State Controller John Chiang has announced he will stop issuing IOUs Sept. 4, a month earlier than previously projected. Ending the IOUs, Chiang said in a press release today, "does not bring an end to our fiscal challenges." The press release includes a link to a graph of California's cash outlook.

Senate President Pro Tem Darrell Steinberg will discuss his lawsuit against Gov. Schwarzenegger today at 2 p.m. at the Mission Neighborhood Health Center in San Francisco. Sen. Loni Hancock will also attend the talk.

Gov. Schwarzenegger's administration has spent $228,000 on furlough litigation so far, Jon Ortiz reports in his State Worker column this morning.

This time it isn't furloughs that will reduce your pay; it's increased withholding. ABC News10 in Sacramento reports that, as part of the budget, lawmakers are borrowing against against your withholding taxes to raise some $1.7 billion. You'll be repaid, but it's non-interest bearing. You can compensate by increasing your exemptions.

The delegates at the ACSS Delegate Assembly in July voted to reduce the dues for associate members to a flat rate of $15 a month. Previously, the dues were the same as active members' dues. The new dues rate takes effect 60 days from the date of this notice.

FromThe Sacramento Bee: Senate President Pro Tem Darrell Steinberg filed suit Monday to block Gov. Schwarzenegger's line-item vetoes. The suit seeks to stop Schwarzenegger and state Controller John Chiang from imposing cuts to state programs.

Here's some grist to add to your retirement advocacy mill: The State Worker blog today links to a study by the National Institute of Retirement Security that says pension income plays a critical role in reducing poverty and hardship for older Americans. The blog gives a link to the full study.

So state workers make too much money? State Worker columnist Jon Ortiz does the math. Bottom line: State workers haven't nearly kept up with inflation. Here's a quote: "(SEIU members') union wages now trail the CPI (consumer price index) by about 77 percent."

According to The Sacramento Bee Capitol Alert blog, the state Office of the Legislative Counsel has issued an opinion asserting most of Gov. Schwarzenegger's line-item budget vetoes were illegal. The Leg Counsel reached its conclusion in responding to a request from Assembly Speaker Karen Bass. The conclusion: The constitution allows the governor to veto only items of appropriation. The blog contains a link to the report.

The Sacramento Bee's editorial today responds to what it calls "a lot of critical feedback" for its July 27 editorial. The original editorial argued the furloughs were "necessary and equitable." Today's editorial acknowledges the criticism and responds in the form of dialog with an EDD instructor, who makes many informed points.

The LAO has published an easy-to-follow, 15-page report of the recent budget plan signed by Gov. Schwarzenegger.

From The State Worker blog: SEIU Local 1000 has filed an unfair labor practice charge against the California Department of Corrections and Rehabilitation for failing to meet and confer over layoffs that could begin as early as Sept. 15. State departments must meet and confer with unions at least 60 days before layoffs begin.

Partly in response to a demand letter from ACSS, the State Compensation Insurance Fund board of directors has taken a stand on the furloughs that is very beneficial to ACSS members. Specifically, the board on July 31 authorized the SCIF president and CEO, Jan Frank, to “file a cross complaint in any of the pending court proceedings to obtain a ruling from the courts that all State Fund employees are exempted from the Governor’s Furlough Order – including those employees who are not represented by unions with current cases pending)” (italics in original). (Continue reading here.)

A letter writer to The Sacramento Bee claims an editorial ("Modernizing the state's work force") made an "erroneous comparison" in claiming state workers have received a 28 percent pay increase over the past seven years. To read the full letter, click here.

An initiative to lower the legislative majority required to approve a budget or raise taxes from two-thirds to three-fifths (or 67 percent to 60 percent) has been given the go-ahead by the Secretary of State's office. The initiative is being spearheaded by Berkeley-based attorney Robert Denham. California is one of only three states that require the two-thirds majority. McClatchy political columnist Dan Walters isn't optimistic the measure will pass.

SEIU Local 1000 members have voted to give their leaders permission to strike. The union, which represents 95,000 state workers, are upset with Gov. Schwarzenegger for failing to have thei contract, negotiated in February, ratified. The contract called for one furlough day a month, and state workers now have been furloughed for three days. (Link has been updated.)

An Assembly bill signed yesterday as part of the state's new budget allows CalPERS to use more than $265 million in excess reserves to offset members' health premiums for two months.You can expect to see the savings in the fall. CalPERS will post the timing on its Web site.

The governor isn't giving on demands to curb furloughs for agencies that are paid from special funds or losing money for the state because of shortened work schedules, reports State Worker columnist Jon Ortiz.

From the LA Times: With its staff furloughed three days a month, the Franchise Tax Board -- the state's tax collector -- could lose at least $550 million over the next three years and another $372 million for the two years after that from lost revenue and the backlog of dealing with disputes and late collections.

Gov. Schwarzenegger signed the budget yesterday, but not before paring it down further and nearly decimating some programs. For a bullet-point breakdown of the budget fixes, click here. And just when you've gotten comfortable, be warned that the new plan has "plenty of landmines," is "painful but precarious" and has no "safety net."

The governor signed the budget package this morning after making additional cuts that left it in the red.

Sacramento Bee/syndicated political columnist Dan Walters reports this morning that, with the budget deal done, politicians are now talking of reform. It may happen only with a constitutional convention, Walters suggests.

This short item from the mercurynews.com (San Jose Mercury News blog) reveals the hardships of a couple of real people behind the furlough cuts -- and of the public.

The Sacramento Bee Capitol Alert blog reports the governor has ruled out a fourth furlough day for state workers as he makes his final cuts to the state budget.

A Sacramento Bee editorial, one of a series this week, defends the state furloughs as a necessary option to save jobs but says more must be done. State service needs to be made more efficient, with better use of technology and private firms to perform basic services.

According to a Sacramento Bee story Sunday, the governor and legislative leaders didn't negotiate the budget alone. They had help -- from lobbyists. Related articles: Sacramento Bee editorial: The budget is just the beginning; California also needs a review of its tax structure, spending priorities and governance. Los Angeles Time editorial: Putting California back together will require a constitutional change.

The Assembly approved the final bill in the budget package to close a $26 billion gap this afternoon. The plans to take gasoline tax money from local governments and allow oil drilling off the Santa Barbara coast were axed. Deep cuts for education stayed in but will be reimbursed in the future. The final plan reduces the budget by $24 billion. Gov. Schwarzenegger probably will not act on the bills until next week, and it may take weeks before state can stop issuing IOUs.

State Worker columnist Jon Ortiz reports in his blog that SEIU succeeded in having its lawsuit to exempt SEIU's SCIF workers from the furloughs succeeded in having its case transferred to Judge Peter Busch, the same judge who ruled that SCIF had illegally furloughed its legal staff. Later that same day, Gov. Schwarzenegger's legal team challenged the assignment.

California State University professors voted to be furloughed two days a month to prevent further layoffs and save courses. A large majority also voted that they have "no confidence" in their chancellor. The details of the furlough proposal now must be negotiated.

The Senate finished its budget package at about 6:30 this morning; the Assembly is still struggling to complete its plan. The Senate's budget reduces the general fund by 18 percent from two years ago. Major cuts were made to public schools and colleges, social services, health programs and state prisons. State workers will still be furloughed three days a month.

A lubricant spill July 17 -- a furlough Friday -- took nearly 12 hours to clean up because nearby Caltrans workers couldn't be reached, prompting State Worker columnist Jon Ortiz to ponder: Were the phones not answered on purpose? Another Ortiz observation: The delay to close the budget deal cost the state the same amount of money it will save from the third furlough day.

State Worker columnist Jon Ortiz writes in today's blog that the 7,000 total state job cuts the governor announced in May and this month are still on despite the budget deal. The earliest date layoffs will begin is Sept. 15. Of the 5,000 May cuts, Ortiz reports, about 1,100 employees have either transferred or left state service.

CalPERS and CalSTRS together lost nearly $100 billion in the last fiscal year from the stock market beating.The decline means taxpayers will contribute more to shore up the two funds and state workers' contributions will increase. CalPERS has already announced it will demand increased contributions. CalSTRS can't ask for higher payments but has started talking to lawmakers about passing legislation to raise the contribution amounts.

Republicans are threatening to withhold budget votes, saying the Democrats have double-crossed them by developing a proposal to release thousands of prisoners to home detention and county jails. According to Assembly leader Sam Blakeslee, R-San Luis Obispo, it had been agreed the early-prisoner-release issue would not be tackled until after the main budget bill was approved. The vote on the budget is expected Thursday.

Gov. Schwarzenegger and legislative leaders agreed yesterday on a plan to close the $26 billion budget deficit. The plan, which must be voted on by the full Legislature, shifts costs into the future and takes money from local governments. It does preserve Prop. 98, the state's constitutional guarantee for education funding, though it contains several billion dollars in cuts to education at all levels. It is expected the plan would end the need for IOUs (cbsnews.ca story). One writer who is not impressed with the budget deal is The Sacramento Bee columnist Dan Walters.

Cleanup of a lubricant spill near San Rafael on "furlough Friday" was delayed several hours because Caltrans workers were on furlough, The Sacramento Bee's State Worker blog reports. Traffic backed up for miles. The story was originally reported in the Marin Independent-Journal. 

Gov. Schwarzenegger has appointed former ACSS member Jerome Horton to fill Judy Chu's seat on the Board of Equalization. Chu was sworn in July 16 as a congresswoman. Horton, 52, a Democrat, served three terms in the Assembly and was an Inglewood city councilman. ACSS wrote a letter to Gov. Schwarzenegger urging he support Horton's appointment.

Budget talks resume today. Gov. Schwarzenegger and legislative leaders had hoped to finish the deal yesterday, but the meeting was canceled because of a scheduling conflict. The leaders are reportedly close to closing the now-$26 billion deficit. The proposed budget continues the governor's three furlough days for state workers. However, the governor's press secretary said the number of furlough days may be reduced if the economy improves.