Transcript: Press conference Q&A with Ana Matosantos on the 2012-2013 California state budget

Transcript: Press conference Q&A with Ana Matosantos, director of the California Department of Finance, on the 2012-2013 California state budget:

Ana Matosantos, director of the California Department of Finance. IMAGE SOURCE:

Ana Matosantos: “Dan, on the wall of debt, first thing is the $630 million is loan that were paid to be paid off. So it’s not new loans; it’s extensions of new loans on the UI [unemployment insurance].

“There’s a proposal next year to have some eligibility changes and some revenue changes to pay at least for the portion of the $400 million – that’s the ongoing costs associated with the loan repayment.”


Question: “You mean for the 2013-14 budget?”


Ana Matosantos: “Yeah. Going forward.”


Question: “So what’s the bigger picture of the wall of debt?”


Ana Matosantos: “So the bigger picture in the wall of debt is that last year it was $34.7 billion. This year it’s $33 billion. And the budget reduces the wall of debt immediately by paying off about $2.2 billion in deferrals in education. With the plan over by 2015-2016, the entire $33 billion would be paid off.”


Question: “Is that $2 billion in educations – does that hinge on the passage of the taxes?”


Ana Matosantos: “Yes.”


Question: “If the taxes don’t pass…?”


Ana Matosantos: “Correct. If the taxes don’t pass, that remains at the same level and then there’s additional cuts that are the equivalent of three weeks of school.”


Question: “The trigger cuts in education – are those…do they go on the credit card at all?”


Ana Matosantos: “No.

“And David, on the balance of your question on the guarantee drops. If the revenues don’t pass, in addition to the debt service, as a trigger reduction, debt service would get paid out of the Prop 98 guarantee – increasing in the guarantee but saving general funds the money. So there will be no suspension and the $4.8 billion of savings would occur. Those are the two things that happen.”


Question: “Ana, do you have specifics on the trigger implementation on the Department of Forestry and Fire Protection? How much would be cut in terms of the emergency air response program? How many fire stations would have to be closed?”


Ana Matosantos: “We can provide additional detail in due time. I mean, it would be additional closures. It would be reductions of the air program, more reliance on contract resources versus having the air program be continued to be funded out of the base budget.”


Question: “And this is over and beyond the fire fees that we’re still working on?”


Ana Matosantos: “Yes, and this is over and beyond the elimination of the fourth firefighting trucks that was eliminated this year and the other reductions that have gone to place.”


Question: “Can you give us the bottom line on K-12…?”


Ana Matosantos: “So the bottom line in Prop 98 guarantee this year is in 2011-12 under current law is $47.8 [billions]. It would increase with the revenues next year to $52.5 [billions]. Under the trigger scenario, it would be $47.7 [billions].

“Programmatically, there would be a reduction because the deferrals from last year would require additional programmatic cuts this year in order to be able to accommodate that deferral payoff.”


Question: [indecipherable]


Ana Matosantos: “It’s the equivalent of three days of closure – a month.”


Question: “Do you see a majority vote for revenues for this proposal?”


Ana Matosantos: “Majority vote fee increases? No. The revenues are assuming revenues from the tax initiative. There’s the managed care, and that’s a two-thirds vote. And everything else we’ve talked about is all majority vote.”


Question: “On the 15,000 positions, are these 15,000 for the new fiscal year or…?”


Ana Matosantos: “There’s 15,000 has already been eliminated. The budget would eliminate at least another 3,000 positions to answer your question. I know that 3,000 would be eliminated under the budget.”


Question: “All in corrections?”


Ana Matosantos: “The bulk of it is corrections, but it’s not all corrections.”


Question: “So this in the introduction of the budget where it says that making it more efficient by reducing the state workforce by more than 15,000 – that’s already been done.”


Ana Matosantos: “That’s already been done. There would be additional reductions. As outlined in the budget, there would be elimination of 49 different boards, commissions, departments, programs.

“There would be additional reductions to special fund departments. The budget will direct the development of special funds reductions. Those would be likely additional position reductions in special fund departments. Then there’s a series of efficiency initiatives looking at postage and a variety of different things to achieve additional savings out of state operations.”


Question: “So that’s as many as 3,000 number for the next budget year?”


Ana Matosantos: “The at least 3,000 – those would be in addition to the 3,000. There are some that are already there but the special funds reductions, for example, those would be additional reductions.”


Question: “What does it assume in terms of debt sales this year?”


Ana Matosantos: “It assumes there’s a debt sale in the spring, and it assumes that there’s a debt sale next year.”


Question: “And totaling how much?”


Ana Matosantos: “About $5 billion next year and I think the spring sale is about $2 billion.”


Question: “$2.5 billion?”


Ana Matosantos: “$2.5 billion for the sale this spring and about $5 billion for the two sales next year.”


Question: “So the 3,000 for the number of layoffs or reductions that are going forward. Are those layoffs or through attrition?”


Ana Matosantos: “They are reductions in positions. The goal, as the governor talked about, there’s agreements in place to try to redirect employees from facilities that have vacancies like High Desert prison and Pelican Bay from other places where there’s going to be additional reductions, and try to minimize the number of layoffs. So the effort will be to minimize [layoffs] to the extent possible but the total workforce will continue to go down.”


Question: “Can you talk a little about the CalWorks reduction and the savings of $1.4 billion or the reduction of $946 million in the budget. What is that about?”


Ana Matosantos: “So the $946 billion is a combined reduction in the CalWorks program and the new child maintenance program.

“So the CalWorks program today provides cash assistance to adults and to families including adults for up to four years.

“What the proposal would do is it focuses on providing additional work support and focusing on work.

“So families and parents who are meeting work requirements, they will continue to receive 48 months of assistance. And in fact, the amount of work support will increase somewhat from today by another $44 a month.

“For families that are not meeting work requirements, the time limits will now be two years not four years.

“For children, in order to continue to provide that support, there will be a new child maintenance program, and that child maintenance program will continue to provide assistance to kids under the same eligibility rules today except they will have annual eligibility requirements instead of twice a year. And that grant level will decline by for the average family, I think, about $71 per month.

“So that’s roughly what the CalWorks proposal looks like.

“The child care would also be focused on work so families will continue to receive child care if they’re meeting federal welfare-to-work requirements. There would be a bonus of $50 per month that would be provided to those families to support work. The eligibility would be at 200% of poverty, and there would be some reductions in rates for child care providers.”


Question: “What kind of caseload changes do you see coming…?”


Ana Matosantos: “The reduction in child care slots is around 70,000. The CalWorks side of the equation – 35,000 cases would become ineligible out of a total of 600,000. 600,000 is the total caseload. The reduction in the number of cases is about 35,000.”



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2 Comments on “Transcript: Press conference Q&A with Ana Matosantos on the 2012-2013 California state budget

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