Schwarzenegger, meanwhile, said the state now has few options but to make tough cuts to match plummeting revenues not seen in a decade.
"Our revenues now are back to the 1999 level," Schwarzenegger told reporters after a morning prayer breakfast in Sacramento. "So we have to do drastic measures. We have to dial back to what was happening in 1999."
There was other grim news, as federal officials delivered a sobering response to the state's pleas for short-term help to pay its bills. Treasury Secretary Timothy F. Geithner raised doubt that he has the authority to guarantee the loans California needs to avoid running out of cash in the next few months.
In Sacramento, state Legislative Analyst Mac Taylor said the continuing slump in revenue could mean the governor's forecast of a $21.3-billion deficit might be $3 billion short, meaning the chasm between revenue and spending could be at $24.3 billion or more.
He also said some of Schwarzenegger's plans might not work. Taylor expressed doubt about the proposed $1-billion sale of a state-owned workers' compensation insurance program and a plan to save $750 million on the state's costly Medi-Cal program by cutting healthcare reimbursements or slashing the number of eligible participants.
Taylor also emphasized a need for the Legislature to "make the difficult decisions" and act quickly, which would "likely boost the confidence of the public and investors in the budget process" as well as prevent the anticipated cash crunch in early July.
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eric.bailey@latimes.com
patrick.mcgreevy@latimes.com
