Dean Coppola / McClatchy Tribune

Fresno State students and staff expressed frustration Thursday as California̢۪s indefinite halt on state income tax refunds threatens workers counting on a little extra money to get them through the spring.

Student Andre Tolmachoff said he is frustrated that state lawmakers cannot agree on a budget plan. “It is just a vicious cycle,â€Â Tolmachoff said.

Following months of budget indecision and weeks of flirting with the idea of placing holds on tax refunds, Gov. Arnold Schwarzenegger and state officials this week imposed an indefinite halt on more than $30 billion owed to taxpayers, according to news reports.

Instead of issuing tax refunds, the state may resort to issuing IOUs.

State Controller John Chiang, the state̢۪s chief financial officer, estimates that California will be at least $346 million short in paying its bills this month.

Eroding revenues and a chronic structural budget deficit have destroyed the state̢۪s cash reserves, Chiang said in a Jan. 16 statement.

Students ‘don’t even care anymore’

The shortage of cash in California’s general fund impacts Medi-Cal recipients, state vendors and taxpayers expecting refunds — including college students.

Jason Paul, a kinesiology major, said he is fed up with the economy and has stopped paying attention to it. “I know of the budget cuts, but things are so bad I don’t even care anymore,â€Â Paul said.

“Money is tight and an IOU will not help with my bills,â€Â Paul said. “I can’t tell T-Mobile, ‘I don’t have the payment this month. Here’s an IOU.’â€Â 


The state budget mess makes Paul wonder if lawmakers know what they̢۪re doing in Sacramento.

“I guess that’s what happens when an actor is your governor,â€Â he said.

Some students see the effects of the budget crisis differently.

Jenea Cox, 22, a student employee at the USU information center, knows about the state budget problems but does not think they affect her the way it might others. “It doesn’t really matter,â€Â she said.

However, Cox said she has seen a rise in the cost of living. “Everything costs more,â€Â she said. “It’s harder to buy groceries and I don’t get to have fun anymore.â€Â

Local businesses, tax refunds to be affected

Students who have not yet been directly affected by the state budget situation still notice the crisis in other ways. Georgianna Negron, a senior psychology major, says she feels sad to see local businesses closing due to the bad economy.

Vanessa Smiley, 24, wasn̢۪t fully aware of the state financial crisis. When she learned about the recently announced freeze on tax refunds, she expressed anger.

“I basically live on my income [working] at Palomino’s during the semester, and I really need that money,â€Â Smiley said of her pending tax refund.

Smiley said she was most angry at Gov. Schwarzenegger.

“No wonder they don’t have him in the new ‘Terminator’ movie,â€Â she said.

Lauree Mallard, 23, also didn̢۪t know about the delay and expressed similar sentiments. The history major, who works as a waitress, said she is primarily earning money through tips but with the current state of the economy her weekly salary has been cut in half.

“I’m doing OK now,â€Â she said, “but it’s only going to get worse.â€Â

Quaid Breniman, 19, said that although he has heard about the income tax delay, he isn̢۪t worried about it.
“I still live at home, so it’s not like I really need a lot of money,â€Â Breniman explained. “I work two jobs and am still out there being a consumer.â€Â

Health and Human Services administrative assistant Janice Rutherford offered a simple solution to the state̢۪s current economic situation, saying that state lawmakers need to take responsibility.

“We should cut their pay and put them in an IOU system,â€Â Rutherford said.

By Brian Maxey and Christy Collet / The Collegian

Additional reporting by Brionie Dixon, Mallory Frost, Donnie Johnson and Danielle Villalobos.̢۬