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io. A -5 fiber 20, 2002 sue #45 -2002 d tagink afro GOVERNOR ANNOUNCES $34.8 BILLION DEFICIT The other shoe fell this week. Saying the problem is so severe that he wants to let Californians know about it as soon as possible, Governor Gray Davis announced on December 18 that state government faces a dramatic and painful budget deficit of $34.8 billion in the remainder of the current (2002/03) and the next (2003/04) fiscal years. He called on the legislature to immediately enact the $10.2 billion in budget reductions he called for just two weeks ago and promised he would propose additional budget cut recommendations and revenue increases early next month. He declined to offer any details on the revenue package. For more see page 3. .. ... . ... .... . . . . .... . . . LEAGUE JOINS ADVOCATES, OTHER LOCAL OFFICIALS, TO TESTIFY TO IMPACTS OF PROPOSED BUDGET CUTS League representatives joined forces with housing and transportation advocates and other local officials this week to testify before two Assembly budget subcommittees about the impacts of two of Governor Davis' proposed current year budget cuts. The Assembly called for the hearings to give the affected parties an opportunity to educate the members on the "human face" of the proposals. The first of these hearings occurred on December 17 in Sacramento, when the League and others explained to members of the Assembly Budget Subcommittee on State Administration how a proposal by Governor Davis to transfer $500 million in Low and Moderate Income Housing Funds could undo many projects that are in the planning stages, that have already obligated funds, and that would help the State solve its urgent extreme need for additional low and moderate income housing. For more see page 2. ........................ NLC ELECTS THREE FROM CALIFORNIA Three California city officials were elected to the National League of Cities (NLC) board of directors at the organization's recently concluded Annual Congress in Salt Lake City (December 5 -7). Congratulations to Ron Bates (Mayor, Los Alamitos and past president of the LCC), Helen Kawagoe (City Clerk, Carson and past LCC director), and Alex Padilla, President of the City Council, Los Angeles and current LCC director). As a result of their election, Bates and Kawagoe will rejoin the LCC board in this new capacity. Chris McKenzie, Executive Director, expressed thanks to outgoing NLC board members Joe Hilson, Hayward, and John Heilman, West Hollywood, for representing California so well at NLC the last two years. Hilson remains on the LCC board as an at -large member. Page 3 • League Files Amicus Brief in SB 402 Case Cities Page 4 • PG &E Asks League to Delay Release of Sample Franchise Agreement • Survey Measures Terrorism Concem by Califomia Officials