SACRAMENTO, Calif. — California’s budget deficit will reach $41.8 billion over the next 18 months, potentially forcing the state to halt payment for services such as utilities for state offices and food for prison inmates if the problem isn’t solved, Gov. Arnold Schwarzenegger’s administration said Thursday.
The gap is far worse than already abysmal estimates, which a Legislature’s nonpartisan analyst had pegged at $28 billion through June 2010.
The shortfall for the current fiscal year, which ends June 30, has grown to nearly $15 billion. Together with deficit estimates for the next budget year, the total is $41.8 billion, said Matt David, a spokesman for Schwarzenegger.
California is projected to run out of cash in February and may have to issue IOUs for its bills.
The Associated Press
