[420 Girl]

Did you notice? California Budget Crisis Diaries went weekly, rather than twice a weekly. I know, I know…I didn’t warn you beforehand — my deepest apologies, but this reporter has been busy. Rest assured, though, when we hit another budget impasse in a couple of months (not speculating, just saying), I’ll give you all the info you need to know as often as you need to know it. For now, though, look out for CBCD every Thursday.

So here we go, here’s your weekly dose of CBCD aka your geeky but civic-y addiction.

More weed talk: California is not the only state that may legalize marijuana this year.

According to Reuters, the proposal will face voters in other states, too.

“Similar voter initiative efforts are underway in Washington and Oregon for 2010, and Nevada for 2012. New Hampshire, Massachusetts and Rhode Island are all considering legislation to legalize and regulate the drug, and states as conservative as Virginia and South Dakota are debating decriminalization.”

Additionally, because budgetary problems aren’t unique to California, the same states are researching how much money the government can garner/save by legalizing the drug.

“A 2005 study by Harvard University economist Jeffrey Miron estimated that legalizing marijuana would save $7.7 billion per year in spending on enforcing the drug laws, with the bulk of that, $5.3 billion, at the state and local level.”

So could Americans finally legalize marijuana? Reuters reports: “In October, polling firm Gallup found 44 percent of Americans favored legalization, echoing other recent surveys. That’s up from 31 percent a decade ago.”

So not Greek: For those who thought California was worse off than Greece — think again.

According to The San Francisco Chronicle, investing in California is far more attractive than investing in Greece.

“Debt issued by California, the world’s eighth-largest economy, is outperforming Greece’s bonds as funds including Cumberland Advisors say investors are betting the lowest-rated U.S. state’s credit risk has been exaggerated. The cost to protect against California not paying its obligations is the lowest relative to Greece in at least 15 months, according to data compiled by Bloomberg.

“Greece, with the European Union’s largest budget deficit and an economy one-fifth California’s in size, is grappling with a debt crisis that’s resulting in skyrocketing borrowing costs. The yield on the 10-year Greek bond rose to 7.16 percent on Jan. 28, the highest since October 1999, prompting European leaders to pledge aid to the nation. Even with an $18 billion budget gap expected over the next 15 months, California sold $3.4 billion in taxable debt last week at its lowest costs since November as overseas buyers purchased 30 percent of the debt.”

So what does this mean? Peter Demirali, the head of the fixed-income department at Cumberland Advisors told the Chronicle, “They are saying that they will lend a billion dollars to California, no problem.”

California courts: Here’s another “we are not alone” blurb. When it comes to budget cuts to state court system, other states are doing it too to find a little fiscal relief.

According to the USA Today, the budget cuts made to the court system are causing major delays but many states are making the same move.

“At least 15 states have put court workers on furloughs, eight have cut pay, six have imposed layoffs, and six have closed courtrooms to save money in the face of state funding cuts, even as the number of legal cases is rising, according to the Virginia-based National Center for State Courts.”

Though other states have made the same cuts, California’s situation is a little more severe than other states (as we all know, right?).

“Cutbacks have been most severe in California, where courts are closed across the state one day a month as a cost-saving measure. In Los Angeles, where 100,000 people a day go through the largest county court system in the USA, 19 of 580 courtrooms have been closed and as many as 50 more are to be closed by September, Presiding Judge Charles ‘Tim’ McCoy said.

Los Angeles last month began laying off 829 court employees, and by the end of the year expects what once was a 5,400-worker system to be reduced by about 20%, McCoy said.

The state’s budget crisis has cut $133 million from the Los Angeles court system’s $800 million budget, McCoy said.”

Bumpy ride: State Controller John Chiang is being brutally honest with Californians.

According to the Contra Costa Times, Chiang said Monday “the worst is yet to come.”

“Although lawmakers are challenged by a nearly $20 billion deficit, “the bad year’s 2012,” Chiang said.

That year, state finances will be hit with a trifecta of pain: The temporary tax hikes approved last year will be over; federal stimulus funds will be gone; and funds that the state ‘raided’ from local governments will come due.

The deficit at that point will be some $25 billion, according to Schwarzenegger administration estimates.”

But that’s not it, according to the Times, “Chiang said California also owes its own ’special’ state funds some $20 billion that it has borrowed in recent years to close deficits, referring to pots of money outside the state’s general fund.”


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