455.Paper.Peter Qu.UC Budget Cuts.AUT08

Intermoflogicthedecisionsmakershavefirstraisedaddition

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California’s
Department
of
 Finance
can
perfectly
forecast
the
future
revenue
and
expense
and
arrive
at
an
accurate
 prediction
of
budget
shortfall.

However,
the
Department
of
Finance
should
take
into
account
of
 the
uncertainties
of
their
prediction
in
the
draft
of
the
State
budget.
 The
unexpected
increase
in
shortfall
for
the
fiscal
year
2007/2008
and
the
significant
upward
 revision
in
the
May
revision
of
2008/2009
budget
highlight
the
under‐estimation
of
uncertainty
 by
the
State
government.

In
the
budget
proposal
submitted
on
January
10,
2000,
Governor
 Schwarzenegger
cited
two
immediately
concerns
at
that
time.

First,
an
unexpected
$
3.3billion
 shortfall
emerged
for
the
previous
fiscal
year
(Schwarzenegger,
State
Budget
2008‐09,
2008).

 Second,
a
$14.5billion
shortfall
is
predicted
for
the
current
fiscal
year
of
2008/2009
 (Schwarzenegger,
State
Budget
2008‐09,
2008).

By
the
time
Governor
Schwarzenegger
 submitted
the
revision
to
the
State
budget
proposal
on
May,
2008,
the
predicted
shortfall
has
 widened
significantly
from
$14.5billion
to
$24.3billion
(Schwarzenegger,
May
Revision
2008‐09,
 Governor's
Budget,
2008).
The
two
significant
revisions
to
the
budget,
first
on
January,
2008,
 then
on
May,
2008
are
indications
that
the
Governor
and
the
Department
of
Finance
has
not
 appropriately
consider
the
uncertainty
related
to
their
revenue
and
expense
forecast.


 2) Short
term
impact
of
UC
budget
cut
 The
UC
officials
have
analyzed
the
budget
cut
proposal
from
the
Governors
and
estimated
the
 cost‐cutting
efforts
that...
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This document was uploaded on 02/17/2014.

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