Controller: State will run out of cash before April
January 30, 2010
State Controller John Chiang warned Friday that California will run out of the cash needed to pay bills by April–unless Gov. Schwarzenegger and legislative leaders agree on nearly $9 billion in budget cuts. [Oakland Tribune]
Those cuts are needed, Chiang insists, to pump $1.3 billion into the state’s checking account. However, even with those cuts, Sacramento won’t reach $2.5 billion in funds, considered a safe level of cash, until later in April when state tax revenue starts flowing in.
Chiang is considering some options to maintain that safety cushion, which could mean the delay of payments by the state, including income tax refunds, this spring.
If the budget gridlock continues, Chiang also warned the state may have to give out more IOUs.