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Schwarzenegger threatens third furlough day for state employees

Gov. Arnold Schwarzenegger plans to furlough state workers an additional day each month starting in July if lawmakers do not send him a solution for the entire $24 billion budget deficit, he said today.

Schwarzenegger's move would force state workers to take three unpaid days of leave each month, the equivalent of roughly a 14 percent pay cut in all. The governor framed the additional furlough day as an effort to save cash as the state faces the prospect of issuing IOUs starting Thursday.

"It's clear that if the Legislature does not send a full budget solution to my desk by June 30, California will face an extreme cash-flow problem that will threaten our ability to pay for vital services," Schwarzenegger said in a statement. "I cannot force the Legislature to act, so I must do what is in my power as Governor to conserve cash so that the state can continue to operate. Today I am directing all agencies to prepare to implement a third furlough day for all employees beginning July 1 in the event that no budget solution is in place by that date."