http://people.bakersfield.com/home/Blog/politicsanyone/46424 As had been rumored, State Controller John Chiang told lawmakers in Sacto today he'll be sending out IOUs starting next week. (I'll also paste in text of the news release below.) Here's a link to technical info about the &quot;registered warrants.&quot; I'll be poking around trying to find out how this might affect the city of Bakersfield, which is passing its annual budget tonight. &nbsp; - Gretchen Wenner, staff writer &nbsp; Release text: &nbsp; State Forced to Issue &ldquo;IOUs&rdquo; Without Immediate Budget Fix PR09:021 6/24/2009 Contact: HALLYE JORDAN 916-445-2636 &nbsp; SACRAMENTO &ndash; Today State Controller John Chiang announced that he will be forced to issue registered warrants &ndash; also known as IOUs &ndash; beginning July 2 if immediate budget and cash solutions are not quickly adopted by the Governor and Legislature. &ldquo;Next Wednesday we start a fiscal year with a massively unbalanced spending plan and a cash shortfall not seen since the Great Depression,&rdquo; Chiang said. &ldquo;The State&rsquo;s $2.8 billion cash shortage in July grows to $6.5 billion in September, and after that we see a double-digit freefall. Unfortunately, the State&rsquo;s inability to balance its checkbook will now mean short-changing taxpayers, local governments and small businesses.&rdquo; The Controller was forced to delay payments for 30 days in February to manage a smaller cash crisis.&nbsp; But the magnitude of this shortfall &ndash; which is nearly five times larger &ndash; cannot be temporarily covered by payment delays.&nbsp; The option to pursue short-term, high-cost loans from Wall Street to cover the cash shortfall was taken off the table by Governor Schwarzenegger earlier this month. The State Controller met with the Governor and Legislative leaders this week to warn them of the consequences of further budget delays.&nbsp; In addition to the burden on those who receive the notes, resorting to IOUs sends a signal that California has exhausted all other options to manage its cash flow. Payment categories protected by the State Constitution, federal law and court decisions will receive regular payments in July.&nbsp; All other general fund payments will be paid with IOUs. These include payments to local governments for social services, private contractors, state vendors, income and corporate tax refunds, and payments for State operations including legislative per diem. The warrants will carry an interest rate set by the Pooled Money Investment Board. The Controller has requested an emergency meeting of the Board on July 2 to set the rate. Any rate adoption will become effective immediately.&nbsp; The warrants will have a maturity date of October 1, 2009. If IOUs are issued next month, the State Controller will launch a customer call-center to answer questions.&nbsp; The Controller&rsquo;s Web site, www.sco.ca.gov &lt;http://www.sco.ca.gov&gt; , will be updated regularly with the latest information on the State&rsquo;s cash position and related developments.&nbsp; The Controller's Web site also has several new Web pages &lt;http://www.sco.ca.gov/eo_news_registeredwarrants.html&gt;&nbsp; with information about registered warrants. ### &nbsp; &nbsp; &nbsp; As had been rumored, State Controller John Chiang told lawmakers in Sacto today he'll be sending out IOUs starting next week. (I'll also paste in text of the news release below.) Here's a link to technical info about the &quot;registered warrants.&quot; I'll be poking around trying to find out how this might affect the city of Bakersfield, which is passing its annual budget tonight. &nbsp; - Gretchen Wenner, staff writer &nbsp; Release text: &nbsp; State Forced to Issue &ldquo;IOUs&rdquo; Without Immediate Budget Fix PR09:021 6/24/2009 Contact: HALLYE JORDAN 916-445-2636 &nbsp; SACRAMENTO &ndash; Today State Controller John Chiang announced that he will be forced to issue registered warrants &ndash; also known as IOUs &ndash; beginning July 2 if immediate budget and cash solutions are not quickly adopted by the Governor and Legislature. &ldquo;Next Wednesday we start a fiscal year with a massively unbalanced spending plan and a cash shortfall not seen since the Great Depression,&rdquo; Chiang said. &ldquo;The State&rsquo;s $2.8 billion cash shortage in July grows to $6.5 billion in September, and after that we see a double-digit freefall. Unfortunately, the State&rsquo;s inability to balance its checkbook will now mean short-changing taxpayers, local governments and small businesses.&rdquo; The Controller was forced to delay payments for 30 days in February to manage a smaller cash crisis.&nbsp; But the magnitude of this shortfall &ndash; which is nearly five times larger &ndash; cannot be temporarily covered by payment delays.&nbsp; The option to pursue short-term, high-cost loans from Wall Street to cover the cash shortfall was taken off the table by Governor Schwarzenegger earlier this month. The State Controller met with the Governor and Legislative leaders this week to warn them of the consequences of further budget delays.&nbsp; In addition to the burden on those who receive the notes, resorting to IOUs sends a signal that California has exhausted all other options to manage its cash flow. Payment categories protected by the State Constitution, federal law and court decisions will receive regular payments in July.&nbsp; All other general fund payments will be paid with IOUs. These include payments to local governments for social services, private contractors, state vendors, income and corporate tax refunds, and payments for State operations including legislative per diem. The warrants will carry an interest rate set by the Pooled Money Investment Board. The Controller has requested an emergency meeting of the Board on July 2 to set the rate. Any rate adoption will become effective immediately.&nbsp; The warrants will have a maturity date of October 1, 2009. If IOUs are issued next month, the State Controller will launch a customer call-center to answer questions.&nbsp; The Controller&rsquo;s Web site, www.sco.ca.gov &lt;http://www.sco.ca.gov&gt; , will be updated regularly with the latest information on the State&rsquo;s cash position and related developments.&nbsp; The Controller's Web site also has several new Web pages &lt;http://www.sco.ca.gov/eo_news_registeredwarrants.html&gt;&nbsp; with information about registered warrants. ### &nbsp; &nbsp; &nbsp; en-us Wed, 24 Jun 2009 12:33:34 PDT <p>The state is broke. Let's keep it that way. We've seen what they do with money when they have it.</p> <p>More seatbelt crackdowns, more hunting down of personal marijuana growers, more prostitution stings. This means we need more cops, and more cops means more people retiring at 50 on the taxpayer dole. It means more people sent to jail, which means more prisons, and more prison guards to retire at 50 or 55 on the taxpayer dole. I'll support a bigger budget when they prove that they won't spend it stupidly and create themselves an exclusive socialistic club.</p> http://people.bakersfield.com/home/Blog/politicsanyone/46424/#c_414519 http://people.bakersfield.com/home/Blog/politicsanyone/46424/#c_414519 <p>The state is broke. Let's keep it that way. We've seen what they do with money when they have it.</p> <p>More seatbelt crackdowns, more hunting down of personal marijuana growers, more prostitution stings. This means we need more cops, and more cops means more people retiring at 50 on the taxpayer dole. It means more people sent to jail, which means more prisons, and more prison guards to retire at 50 or 55 on the taxpayer dole. I'll support a bigger budget when they prove that they won't spend it stupidly and create themselves an exclusive socialistic club.</p> <p>I must respectfully disagree.&nbsp; Broke is not good.&nbsp; I also think the money could be spent in wiser ways, but broke means folks lose their jobs and get their salaries cut, which means less money goes into the economy, which means more folks lose their jobs and get their salaries cut.&nbsp;</p> <p>What I haven't seen enough of from our government is creative thinking applied to generating revenue for the state. &nbsp;It's all about &quot;What can we take away from the people of California?&quot;</p> http://people.bakersfield.com/home/Blog/politicsanyone/46424/#c_414659 http://people.bakersfield.com/home/Blog/politicsanyone/46424/#c_414659 <p>I must respectfully disagree.&nbsp; Broke is not good.&nbsp; I also think the money could be spent in wiser ways, but broke means folks lose their jobs and get their salaries cut, which means less money goes into the economy, which means more folks lose their jobs and get their salaries cut.&nbsp;</p> <p>What I haven't seen enough of from our government is creative thinking applied to generating revenue for the state. &nbsp;It's all about &quot;What can we take away from the people of California?&quot;</p> <p>OK, as long as they accept a IOU when they try to deduct taxes from our incomes.</p> http://people.bakersfield.com/home/Blog/politicsanyone/46424/#c_414663 http://people.bakersfield.com/home/Blog/politicsanyone/46424/#c_414663 <p>OK, as long as they accept a IOU when they try to deduct taxes from our incomes.</p> <p>maybe the terminator needs to start a stimulus package DOC</p> <p>,,heck i could use a couple more hundred for trillions more debt..</p> http://people.bakersfield.com/home/Blog/politicsanyone/46424/#c_414693 http://people.bakersfield.com/home/Blog/politicsanyone/46424/#c_414693 <p>maybe the terminator needs to start a stimulus package DOC</p> <p>,,heck i could use a couple more hundred for trillions more debt..</p> <p>Now is the time to legalize pot, grow it in State run facilities, undercut the competition and make billions.</p> <p>&nbsp;</p> <p>So long State budget woes!</p> http://people.bakersfield.com/home/Blog/politicsanyone/46424/#c_414706 http://people.bakersfield.com/home/Blog/politicsanyone/46424/#c_414706 <p>Now is the time to legalize pot, grow it in State run facilities, undercut the competition and make billions.</p> <p>&nbsp;</p> <p>So long State budget woes!</p> <p>They need to&nbsp;eliminate duplication of services where ever possible. &nbsp; Combine city and county's social services, library administration, parks administration, etc.&nbsp;&nbsp; Combine small, closely proximal&nbsp;(word?) school districts.&nbsp; &nbsp; And so forth.</p> http://people.bakersfield.com/home/Blog/politicsanyone/46424/#c_414708 http://people.bakersfield.com/home/Blog/politicsanyone/46424/#c_414708 <p>They need to&nbsp;eliminate duplication of services where ever possible. &nbsp; Combine city and county's social services, library administration, parks administration, etc.&nbsp;&nbsp; Combine small, closely proximal&nbsp;(word?) school districts.&nbsp; &nbsp; And so forth.</p> <p>Just pot?&nbsp; Legalize crank too.&nbsp; Make it in State run labs, undercut the competition and make billions.</p> <p>Why not.&nbsp; With the direction this deep blue State is heading, legalize it all.&nbsp; Call it Soma and enter boldly into the brave new world.</p> http://people.bakersfield.com/home/Blog/politicsanyone/46424/#c_414714 http://people.bakersfield.com/home/Blog/politicsanyone/46424/#c_414714 <p>Just pot?&nbsp; Legalize crank too.&nbsp; Make it in State run labs, undercut the competition and make billions.</p> <p>Why not.&nbsp; With the direction this deep blue State is heading, legalize it all.&nbsp; Call it Soma and enter boldly into the brave new world.</p> <p>Dril, I'd be in favor of that---quality control would be much better.&nbsp; The stuff they're making in Oildale is crap these days.</p> <p>Just as long as they don't set up stills...that stuff'll *KILL*&nbsp;ya.</p> http://people.bakersfield.com/home/Blog/politicsanyone/46424/#c_414716 http://people.bakersfield.com/home/Blog/politicsanyone/46424/#c_414716 <p>Dril, I'd be in favor of that---quality control would be much better.&nbsp; The stuff they're making in Oildale is crap these days.</p> <p>Just as long as they don't set up stills...that stuff'll *KILL*&nbsp;ya.</p>