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Prop76 being called the 'Live within Our Means' Act

State election materials characterize the affect of Proposition 76 on the state budget as making major changes to the process. Sacramento reporter Jenny O'Mara has more.

Governor Schwarzenegger says what he calls the Live within Our Means Act will restrain California's spending problem He and his opponents are fighting it hard in television ads

Prop 76 enacts a new limit on state spending. It grants new power to the Governor to reduce spending mid-year, if state revenues fall. The Governor gets that power if the state legislature can't reach a solution. Excess revenues in good times would go to a budget reserve. It also changes the voter approved funding guarantee for schools, known as Prop. 98.

Kerr: "To give this Governor and all future governors so much power is inappropriate and it's not the way our government is supposed to run."


Barbara Kerr is the California Teachers Association President. Kerr says the measure also kills provisions that protect the minimum funding level for schools. Governor Schwarzenegger recently took on that issue at a media event. He says one-time funds in good years could be given to schools.

Schwarzenegger: "Is that what we want to do with our children? Take them on a roller coaster ride? Or should we go and create a rainy day fund? So that we have extra money available so when we go down that we can fill that hole."

Schwarzenegger says Prop 76 will help smooth the volatile forces that dictate the state's budget process. One report by the state Legislative Analyst says its success depends on how much can be stashed away.