Federal recovery act promises help for Californians

OAKLAND, Calif. — Californians smarting from billions in cuts to their state budget, finally completed in mid-February, can take heart from news about what’s in President Obama’s American Recovery and Reinvestment Act for their state, Rep. Barbara Lee (D-Calif.) told local community leaders and elected officials at a Feb. 27 briefing.

Though the Bush administration’s policies “left our country in a shambles,” Lee told the crowd that filled the Oakland Asian Cultural Center auditorium, the president is “acting very boldly” and is “very committed to providing communities the assistance they need to put people back to work.”

In California, the act would quickly: • Create or save nearly 400,000 jobs over the next two years, mostly in the private sector, in a range of industries from clean energy to health care. • Provide 12.4 million workers and their families with a tax cut of up to $800. • Make over half a million families eligible for a new American Opportunity Tax Credit to make college affordable. • Offer an additional $100 per month in unemployment benefits to nearly 2.4 million workers who have lost their jobs in the current economic crisis, and provide extended unemployment benefits to an additional half a million laid-off workers. • Provide funds to modernize over 1,200 schools.

Also last month, the administration unveiled a $50 billion nationwide program to ease the impact of home foreclosures.

Lee and a panel of experts from regional offices of key government agencies and departments pointed out that California would also benefit from the recovery bill’s provisions to double the nation’s capacity to generate renewable energy, computerize all health records, and greatly increase investments in roads, bridges and mass transit systems.

The national stimulus legislation was the centerpiece of a radio address Feb. 28 by California Assembly Budget Committee chair Noreen Evans (D-Santa Rosa), who called its provisions “crucial” to get the state’s economy back into high gear.

With funding already rolling out of Washington, Evans said the Assembly has set up a new task force to work with local governments, business leaders, workers and community groups to make sure the federal funds make the biggest impact on immediate and long term economic goals.

With California facing 10.1 percent unemployment and “the most home foreclosures in the nation,” Evans said, “these challenges demand aggressive use of every resource the president’s stimulus plan offers.”

The California budget signed into law Feb. 20 by Governor Arnold Schwarzenegger after more than three months of legislative haggling includes nearly $15 billion in spending cuts, $12.5 billion in increased revenues, nearly $8 billion from the American Recovery and Reinvestment Act as well as several billion in new borrowing. Also included are tax breaks that will cut revenues by $2.5 billion through 2013, and a cap on future spending. Eight provisions related to the legislation must be submitted to voters in a special May 19 election. Some cuts may be rescinded if the state receives enough funds through the recovery act.

The long legislative process was triggered by California’s requirement that budget measures be passed by a two-thirds majority. Democrats control both legislative houses but lack that majority; most Republicans have signed a Grover Norquist no-new-taxes pledge but a small handful were eventually persuaded to break ranks and vote for the budget package.

Health, education and other human services were hardest hit by the cuts. While huge health care cuts could be lessened by federal funding from the stimulus bill, a spending cap “would lock us into the current broken, resource-starved health system … which includes over 6 million uninsured Californians and the lowest per-patient Medicaid spending in the nation,” Anthony Wright, executive director of the 200 plus-member Health Access coalition, warned in a blog.

“While we may be in the midst of uncertain economic times, what is certain is how the state’s adopted education cuts of more than $11 billion will play out in our schools, colleges and universities,” California Teachers Association President David Sanchez said on CTA’s web site. “These cuts will impact an entire generation of children and escalate California’s race to the bottom in education funding,” he added.