From LA Times.com:
Reporting from Sacramento -- The administration of Gov. Arnold Schwarzenegger presented a new plan this morning to raise several taxes and cut deep into dozens of state programs to close an 18-month budget deficit that is projected to reach $41.6 billion.
Under the proposal, presented at the Capitol by the governor's staff while he was vacationing with his family in Sun Valley, Idaho, Californians would be dealt a steep sales-tax increase, a new tax on alcoholic beverages and higher vehicle registration fees. A dependent care tax credit would be reduced, and oil companies would be charged a new severance tax.
The cuts in the proposal are deep, including a reduction of billions of dollars in K-12 education spending from current levels. State university and community college offerings would also be cut back as tuition and fees go up. Healthcare programs for the poor would be slashed, as would welfare for the elderly and disabled.
The plan also includes reductions in the state workforce, which the governor already implemented by executive order two weeks ago. The order requires state workers to take days off without pay, amounting roughly to a 10% pay cut. Labor unions are challenging that order in court.