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Marketplace Morning Report

October 20, 2009

 

Courts are weighing in on budget cuts

By: Jeff Tyler

California State Capitol, Sacramento
California State Capitol, Sacramento

A federal judge in California has barred the state from cutting money from an in-home care program for the elderly and disabled. Other states may see their proposed budget cuts rolled back by the courts, too. Jeff Tyler reports.

TEXT OF STORY

Kai Ryssdal: As states try to figure out how to balance their budget in the face of declining tax revenues, they're making cuts almost everywhere: Schools, infrastructure spending, and, especially, social services. Not all of those cost savings are going to stick, though.

Here in California a federal judge has barred the state from cutting money from an in-home care program for the elderly and disabled. Marketplace's Jeff Tyler explains other states may well see their proposed budget cuts rolled back by the courts, too.


JEFF TYLER: Social activists have been taking states to court over budget cuts.

Melinda Bird is senior counsel with Disability Rights California, which sued the state to block cuts in home health care.

MELINDA Bird: We're seeing in California and other states this dynamic of balancing the budget on the backs of the poor and the disenfranchised.

Bird says the people she represents are particularly vulnerable.

Bird: Three-quarters of people on this program are over the age of 60. They tend not to be outspoken. And it's easy to cut their benefits. But it also violates federal law.

The state plans to appeal the ruling. If this and other court decisions stand, where does that leave California?

STEPHEN Levy: It will leave the budget out of balance.

Stephen Levy is director of the Center for Continuing Study of the California Economy.

He doesn't foresee a mad scramble by legislators to come up with alternate cuts.

Levy: I doubt that they will come back in November or December and make any budget adjustments.

But Levy expects California's governor will bring out the axe early next year.

Levy: It could well mean that additional cuts will be made in January or February.

Budget cuts have also been challenged in other parts of the country. Last month, a judge in Washington state ordered that disrupted services for the elderly and disabled be restored.

If state's can't save money on these programs, they may need to make even more severe cuts in next year's budgets. And that will likely lead to more lawsuits.

In Los Angeles, I'm Jeff Tyler for Marketplace.