Meanwhile, fewer children from low-income families would be eligible for subsidized health insurance; those that would remain on the rolls would pay more and no longer receive vision coverage. Voters, who last year rejected proposals to scale back costly social services programs created by citizen initiative, would be given another option to do so.
Some $950 million would be cut from the In-Home Supportive Services program, which helps the elderly, infirm and disabled live independently. The governor would tighten eligibility requirements for the program and pay minimum wage to those providing the in-home care. Similar cuts were approved last year but have been blocked by the courts. The governor assumes that the state will prevail in those cases -- which is not assured.
He also proposed eliminating adult day healthcare -- another option short of sending the elderly and sick to nursing homes. The move would save $104 million.
Monthly cash grants to the low-income elderly and disabled would be cut from $845 to $830, the federal minimum.
In 2009, California voters rejected two ballot measures that would have redirected funds from early childhood and mental health programs to balance the budget. But Schwarzenegger proposed returning to the electorate in June to take a combined $1 billion from those two programs to balance the state's books.
He also proposed ending the mandated furloughs of state workers three times a month and cutting pay and benefits. Union leaders question whether such pay cuts could be enacted without returning to the bargaining table.
In the corrections system, the governor proposed slashing funds for prison inmate healthcare by $811 million. Federal judges have already appointed a health czar to oversee the broken health system. That receiver has approval to spend money on inmate healthcare regardless of what Schwarzenegger and the Legislature allocate.
One of the biggest losers under the t plan would be public transit. Through a complex gas tax swap, which would eliminate the sales tax on gas while raising the per-gallon excise tax, about $1 billion would be siphoned from bus and rail funds.
The shift would gut Proposition 42, a voter-approved measure that determines how gas tax money is currently split. Mass transit, which now receives 20% of the taxes, would be cut out of the equation. Drivers would pay slightly less at the pump.
"Once again, the governor offers shell games instead of solutions, and transit riders in California again suffer the consequences," said Joshua Shaw, executive director of the California Transit Assn.
Although the plan lacks broad-based tax hikes, it does include a 4.8% surcharge on residential and commercial property insurance to pay for fire protection, reviving a past proposal that lawmakers have rejected. The surcharge would raise $238 million in the coming fiscal year and $479 million in the next one.
The governor is also proposing to fund state parks by resuscitating a plan rejected by legislators last summerthat sought to raise money withadditional oil drilling off the Santa Barbara coast. That would generate an estimated $200 million for the budget. Environmentalists are vowing to kill the proposal.
Times staff writers Patrick McGreevy and Michael Rothfeld contributed to this report from Sacramento. Times staff writer Richard Simon contributed from Washington.