Happy New Year and welcome to 2009. It’s only January and we’re busy already assessing the direction that the budget and the stimulus package might take us. There is the potential for a lot of new work and there are also a lot of concerns and fears regarding the state budget, the fact that it’s potentially unbalanced, and what that might mean for us as state employees.
First, the state budget: currently, it looks like there is going to be a $15 billion hole in the budget that could grow to $40 billion in the next fiscal year. Clearly, cuts will be necessary short term but the governor is also adamant that we do more than that – that we be able to stimulate the economy, put people to work and make our budget whole not only immediately but for the next fiscal year as well. Right now Governor Schwarzenegger and the Legislature seem close to an agreement which could be in place by the time this column appears.
Whatever the resolution, this is no doubt going to be a tough year. As we look around we need to be thankful for the fact that we do have jobs. There are so many people who are unemployed, losing their homes and facing various other financial difficulties. We do need to appreciate that we have a lot going for us even as we, along with other state agencies, face the possibility of furloughs, potentially up to two days a month.
In addition to furloughs, a number of other agencies are also looking at layoffs of up to 10 percent. We very fortunate in transportation because we could receive additional funds from the purported economic stimulus package. We’re also are looking at the fact that Measure R passed, which will generate additional monies not just for transit but for roadway projects as well.
While there is potential new work on the horizon, we also might be losing exisiting work. We know that the state budget crunch in the General Fund has created a shortage in the Pooled Money Investiment Account (PMIA). Normally, Caltrans would not be affected by this as our funding is primarily through the gas tax. However, some of the districts’ largest projects are financed through Prop 1B bonds, which get paid through the PMIA. Typically, we would turn to the bond market to raise cash for that account but…the overall bad economy has created a shortage of credit. In other words, the credit card’s maxed out, we can’t get a loan so we can’t pay our day-to-day bills. That’s why it’s so important that the governor and the legislature resolve their differences.
It’s also critical that President-Elect Obama quickly passes a stimulus package that will put people back to work and create confidence in the economy so that investors will buy the bonds necessary to fill the PMIA.
There will be cuts in General Fund agencies regardless, because the shortfall will continue into the next fiscal year. We are fortunate that we’re on the stimulus side of things. We can anticipate that our jobs will continue forward and we’ll be employed.
Also, we will be asking for an exemption to furloughs because if the economic stimulus involves infrastructure projects, it doesn’t make sense for the department creating jobs to take two days off a month. I can’t guarantee we’re going to get those exemptions but certainly we’re going to be requesting them. We also will request them for the Maintenance and Traffic divisions as a safety issue. In the meantime, I just want to assure you that we are very focused on what we need to do to keep you working and happy and safe.
That’s my main message now. I know things are very confusing because they are changing quickly. But I think it’s important to concentrate on what we do have and continue to make things better for the people that we work for – the citizens of the California. We need to recognize that we’re fortunate for the position we’re in. We have jobs. We may be asked to sacrifice a little bit but quite frankly no one’s looking at layoffs in the Department right now. In fact, we’re being asked to be in the forefront of creating jobs for others to help stimulate the economy.
Here on the “home front,” I like the fact that we continue to help others who are less fortunate, such as our toy drive, which also provides canned food and clothes to help at the local missions. There’s an article on that in Inside 7. We are also looking out for one of our own, Larry Tiede, an equipment operator in the Maintenance division who lost his home in the fires last fall. The fact that a lot of us are contributing money so that Mr. Tiede and his family can recover and be able to continue working with us at Caltrans tells me that we have what it takes to make it through tough times – the ability to take care of each other.
Going into the new year, we have some reasons for concern and also much for which to be thankful. So, from me and my family to you and yours, I look forward to a happy new year. There’s a lot of work to do and I appreciate the fact that, once again, they’re looking to Caltrans to be able to make it better for everyone else. So thank you and…let’s go.