WHY CALIFORNIA IS IN FAST LANE TO INSOLVENCY
October 28, 2009
June 30, 2009, was fiscal meltdown day for the state of California, says the Sacramento Bee. The Legislature had not passed a budget, tax revenues were plummeting, the state controller was paying bills with IOUs and Gov. Arnold Schwarzenegger was poised to announce a third furlough day each month for state workers.
That very day the state Department of Transportation signed off on purchasing $1.7 million worth of new trucks and truck bodies:
- That spending came on top of $2.6 million on truck expenditures by Caltrans during the previous five months, even as the state's fiscal crisis deepened.
- In February, the Department of General Services, state government's primary purchasing agent, spent another $1.2 million on 50 new hybrid Toyota Priuses.
A Bee investigation has found that most of those new vehicles -- as well as scores more purchased in recent years -- sit unused for months and even years.
A Caltrans spokesman blamed its purchase of unused new trucks on the state's "changing priorities" and "fluctuating workloads."
A spokesman for the Department of General Services (DGS), which bought the 50 hybrid Priuses, said the state didn't want to miss a factory cutoff date to purchase 2009 models. In addition, he said, the departments that initially wanted them may have changed their minds after the governor signed an executive order directing all departments to reduce their vehicle fleets by 15 percent.
All the excuses sound lame, says the Bee. The state's fiscal house of cards was collapsing but the state's purchasing agents were conducting business as usual. Any budget-conscious business or household confronted with the economic challenges of California would have curtailed unnecessary expenditures.
It would have delayed or even canceled the purchase of 50 brand new Priuses at $24,000 each or $4.3 million worth of trucks for which there was no immediate need. Officials in charge of buying cars in California just kept on buying. That explains, in part, why California remains mired in a fiscal mess, says the Bee.
Source: Editorial, "Why state is in fast lane to insolvency," Sacramento Bee, October 27, 2009.
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