Schwarzenegger Reneges on Borrowing from CalPERS

September 17, 2010 ( – California Governor Arnold Schwarzenegger has abandoned a proposal to borrow money from the California Public Employees' Retirement System (CalPERS).

A Schwarzenegger spokesman said, “The governor told the leaders that we’re not going to do that. It’s just not the responsible thing to do,” according to the Sacramento Bee.  

Last month, Schwarzenegger said he would seek $2 billion as an advance on the roughly $74 billion he estimates in savings during the next three decades from his proposals to roll back pension benefits for government workers (see Schwarzenegger to Borrow $2 Billion From CalPERS). But CalPERS officials and California’s largest public employees’ union expressed concerns about the proposal.  

The deadline has passed for a new budget to bridge a $19-billion deficit, but Senate President Pro Tem Darrell Steinberg said before making cuts, the governor first needs to finish collective bargaining agreements with state employee unions, according to the news report.