SACRAMENTO, Feb. 20 (UPI) -- California's chief budget analyst says the gap between revenue and spending may be too big to close by cutting spending and urged closing tax loopholes.
Elizabeth G. Hill, the state's legislative analyst, estimated the shortfall at $16 billion -- higher than the $14.5 billion previously suggested by Gov. Arnold Schwarzenegger, the Los Angeles Times reported Wednesday. Hill blamed the growing shortfall on the depressed housing market, which has hit California especially hard, and high prices for energy.
The legislature and governor adopted $2 billion in emergency cuts last week, mostly hitting education and healthcare for low-income Californians. The figures in Hill's new estimate effectively cancel out those cuts.
She criticized Schwarzenegger's plan to balance the budget with 10 percent spending cuts across the board. The proposal, she said, makes "little effort to prioritize and determine which state programs provide essential services or are most critical to California's future."
Hill said a number of tax breaks and credits for both businesses and individuals could be modified or eliminated, bringing in $2.7 billion. Republican legislators have said they would not consider any tax increase.
