Court Ruling, Facebook IPO Jolt California Budget
Wednesday, February 1, 2012
Just as Facebook announced it's heading for the stock market with an Initial Public Offering, a federal court officially barred the state from cutting its Medi-Cal reimbursement rates. The California Medical Association called the ruling "tremendous news." H.D. Palmer with the governor's Finance Department said it's not so good for California, which faces at least a 75 million dollar budget hit and will appeal.
"We believe it's a way to reduce spending in one of the fastest-growing programs in state government without directly affecting benefits," said Palmer.
When it comes to the Facebook IPO, Palmer's tune is quite different. "If it is as big as has been projected..." say, several hundred million dollars in state revenue, "then on behalf of a grateful state, I will be happy to go to Mark Zuckerberg's house and either wash his windows or mow his lawn," said Palmer.
But Palmer warned it's not yet clear how much money the IPO will bring the state - or when that money will arrive.
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