Gaines Urges Governor to Sign IOU Taxpayer Protection Bill

Assemblyman Gaines is urging Governor Arnold Schwarzenegger to sign Assembly Bill 1506, which passed the Senate unanimously recently and would protect taxpayers from "forced borrowing" should the state issue IOUs.

"Last year, Sacramento refused to accept its own IOUs, yet still demanded payments from and issued hefty fines against thousands of individuals, charities and businesses throughout California," Gaines said. "I encourage Governor Schwarzenegger to require Sacramento to do what it forces everyone else to - accept IOUs as payment."

The bill, authored by Assemblyman Joel Anderson, R- La Mesa, protects taxpayers by allowing them to continue to play by the rules and pay their state taxes and fees on time. If signed into law, the state would be forced to accept its own IOUs as payment for state taxes and fees.

Last year, California issued 450,000 IOUs totaling $2.6 billion to individuals, charities and businesses. Recently, State Controller John Chiang said that he will soon be printing IOUs again if the Legislature cannot come together and pass a budget.

"Sacramento got itself into this mess by spending money it doesn't have and hardworking Californians shouldn't be held responsible for the Legislature's mistakes," Gaines said. "It's time the Legislature makes the difficult decisions necessary to bridge our $19.1 billion budget gap and stops spending the people's hard-earned dollars on programs we can't sustain."