Governor’s Budget Balanced on “Poor People and Students”

May 15, 2007
Contact: Richard Woonacott @  (916) 319-3687

Sacramento, CA - Assembly Member Jim Beall, Jr., Chair of the Assembly Human Services Committee, and the Assembly Select Committee on Alcohol and Drug Abuse, issued the following comments in response to the Governor's revised budget:

“The Governor continues to try to balance the budget on the backs of poor people and students,”
stated Beall.

The Governor’s revised budget retains the suspension of the CalWORKs Cost of Living Adjustment (COLA) and keeps the Full Family Sanction, even though the Assembly Budget Subcommittee on Health and Human services flatly rejected the Governor’s Full Family Sanction proposal when it came before them. The Governor’s revised budget also makes a new cut to the Supplement Security Income/State Supplemental Program (SSI/SSP) which provides cash assistance to the blind and disabled.

“The Governor has not compromised on CalWORKs funding at all. His new budget takes $23 dollars a month from needy families. It might leave 190,000 children without any financial assistance. Then the Governor cuts the SSP, taking $25 dollars a month from the blind and disabled. The Governor makes these cuts to vital human services and then makes double loan payments to Wall Street. This is unconscionable!” decried Beall.

The Governor’s budget cuts drug treatment programs by $25 million (Proposition 36). These programs provide treatment to nonviolent drug offenders and save the State an estimated $2.50 for $1 invested.

The Governor and the Legislature recently agreed to a $7.3 billion prison expansion package that includes more drug treatment programs for inmates. The Governor then cut funding for drug treatment programs that reduce recidivism in his budget.

“We wouldn’t need multibillion dollar prison expansion projects if we funded drug treatment programs outside of prison, as well as in it,” said Beall.

A major proposed solution to the budget deficit is the sale of EdFund, an important guarantor of student loans for the Federal Family Education Loan (FFEL) program. EdFund currently manages over $27 billion of student loans across the United States. The FFEL program is under investigation by Congress and the Attorney General of New York.

“Does it make sense to sell California’s part of the FFEL program while the scandals are still going on? Does it make sense to sell Edfund to a private company, leaving students and their families at the mercy of bankers and stockholders? Does it make sense to base half of our budget solution the sale of EdFund when we are not sure what the value of EdFund is? The answer is simple ─ No!” stated Beall.