California has only enough cash for one month

SACRAMENTO -- California will run out of cash by early March if the Legislature does not take immediate action, Controller John Chiang told budget leaders at the Capitol in a letter Tuesday.

The controller recommends borrowing and delaying some payments in order to deal with the shortfall, which he projects will last seven weeks. Absent that kind of action, the state could face sending IOUs and delaying tax returns.

"Although this cash management plan relies on still more borrowing, payment delays and deferrals, we believe this is the most prudent and responsible course of action considering we have about four weeks before the advent of a cash shortfall," Chiang wrote in a letter to the chairman of the Assembly and Senate budget committees.

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