*Ahem*

Of course it was sent on a furlough day and after 7PM.

GOVERNOR ARNOLD SCHWARZENEGGER

STATE CAPITOL • SACRAMENTO, CALIFORNIA 95814 • (916) 445-2841

January 8, 2010

An Open Letter to State Employees:

Last year, we confronted what history will record as the “Great Recession.” The state made the profoundly difficult decisions necessary to close a $60 billion budget gap, the largest in California’s history.

With our national economy still struggling to recover, California, like most other states, is now confronting a nearly $20 billion difference between expenditures and expected revenues. We are taking steps to rebuild our economy and to turn deficit years into surplus years – but it will take time and require your help.

Over the past year, you’ve helped our state deal with the challenges of a struggling economy by making your own economic sacrifice in the form of furloughs. These furlough savings are helping us preserve the safety net for many Californians and maintain essential services.

As of now, the furlough program will end as scheduled June 30, 2010. In the face of a $20 billion deficit, we are forced to call on you again to help us through the next fiscal year. That is why I am seeking the following changes to take effect July 1:

• Five percent increase in your monthly employee contribution for your CalPERS pension benefit. This change will apply to all retirement categories.
• Five percent reduction in salaries. This change will apply to all employees in the executive branch, including civil service, non-civil service and non-elected officers.

In addition, through an executive order today, I will direct departments to cap the size of their workforce so that we can achieve an additional five percent salary savings in the 2010-11 fiscal year. In most cases, departments will be able to rely on normal attrition rates to meet their workforce cap by the time the fiscal year starts July 1.

I appreciate and thank you for the sacrifices that you have made and continue to make on behalf of this great state. I want all Californians to know how proud I am of your hard work, dedication and commitment.

Sincerely,

Arnold Schwarzenegger

Executive order S-01-10.