SACRAMENTO — State Controller John Chiang issued a stern warning Friday about
California's cash reserves, telling legislative leaders and Gov. Arnold Schwarzenegger
they must act on nearly $9 billion in budget cuts the governor is seeking by
March — or the state will run out of cash to pay its bills.

Without making those cuts — which Chiang says will pump $1.3 billion into the
state's checking account — California would be broke by April 1, no fooling.

The state wouldn't climb back to what's considered a safe level of cash on hand,
$2.5 billion, until later that month, when tax revenues are expected to begin
flowing into Sacramento.

"While our current cash condition is marginally better than it was one year ago,"
Chiang wrote to leaders, "it is still precarious."



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