California Out Of Budget In 2 Mths - Mandatory Days Off

A California State official has warned that California will run out of money in less than 70 days. In the meantime, Governor Arnold Schwarzenegger can strike a budget deal with Democratic leaders soon. If no deal is struck, the California State office could be forced to defer billions of dollars in payments or issue IOUs.

On the other hand, the governor tried to conserve cash by issuing an executive order last week requiring all state employees to take 2 unpaid days off each month starting in February 2009. 2 public employee unions, Professional Engineers in California Government and the California Assn. of Professional Scientists, filed a lawsuit in Sacramento County Superior Court asking the courts to stop Schwarzenegger's cost cutting efforts as it asserts that only the Legislature can alter the pay of workers who have labor contracts with the state.

This is not the first attempt by Schwarzenegger to reduce state costs, he has attempted to reduce the pay of state employees a few months ago but it never took effect as the California state payroll system was incapable of executing the order and the matter landed in court and was stalled.

One would shudder to think of the impact when critical public services could not be delivered when the state runs out of money.