In California's latest doom-and-gloom announcement, Gov. Arnold Schwarzenegger's Department of Finance on Tuesday proposed closing the state's main welfare program, releasing nonviolent prisoners one year early and shuttering up to 80 percent of state parks to shrink the state's $24.3 billion budget deficit.

Schwarzenegger wants $5.6 billion in new cuts to replace a like amount of borrowing he proposed in his budget plan earlier this month. The Republican governor previously asked for more than $15 billion in other savings by slashing schools and Medi-Cal, laying off 5,000 state workers and borrowing money from local governments.

Several of the latest cuts were eye-openers, but the largest was the wholesale elimination of the California Work Opportunity and Responsibility to Kids Program, which provides grants to parents that people commonly refer to as "welfare."

Nearly 1.3 million Californians received CalWORKs payments in February, almost 1 million of whom were children. The state would save $1.3 billion next year by eliminating CalWORKs but lose three times as much in federal funds.

"It boggles the mind that California would be the only state in the Union without a CalWORKs-type program," said Frank Mecca, executive director of the County Welfare Directors Association. "In fact, we'd be, to our knowledge, the only state in a country in the entire First World not to have subsistence benefits for children."

Department of Finance Chief Deputy Director Ana Matosantos laid out the governor's plan during a conference committee hearing, going through each proposal line by line, prompting questions – and expressions of shock. Democratic committee members took issue with many ideas but pledged to consider them in hearings this week.

Besides the CalWORKs elimination, more than 900,000 low-income children would lose medical coverage under a proposal to eliminate the state's Healthy Families program, saving $250 million.

"I would hate to see us eliminate the safety net at a time of rising unemployment, people losing their homes and increasing homelessness," said Assembly Speaker Karen Bass, D-Los Angeles, in a telephone interview. "Having said that, I do completely recognize the revenue situation is serious."

Schwarzenegger envisions phasing out Cal Grants for low-income college students. He would save $10 million by giving only $7,000 to the University of California's Hastings College of the Law, the bare minimum so as not to upset the state's 19th-century compact with the Hastings family. And he wants to defund state parks, forcing them to rely on user fees.

"It could be upwards of 80 percent of parks not having sufficient fee revenues to continue to operate," Matosantos said.

A Schwarzenegger proposal to close parks last year didn't go anywhere, but the state's fiscal condition has worsened considerably since then.

The governor's plan would release a year early about 19,000 nonviolent, non-serious prisoners not convicted of sex offenses, saving $120 million. He also would seek $790 million in savings by reducing inmate services such as substance abuse counseling and vocational education.

The governor proposes saving $150 million by retaining a two-day furlough for state workers.

Schwarzenegger would cut Medi-Cal services such as dialysis, breast cancer treatment for women over 65 and non-emergency care for undocumented immigrants.

Assemblywoman Noreen Evans, D-Santa Rosa, chairwoman of the Assembly Budget Committee, said it would be more responsible to seek additional taxes.

"With this proposal, the governor's made it very clear he'd rather throw women and children out of the lifeboat before he raises taxes," she said.

But Assemblyman Roger Niello, R-Fair Oaks, said the state's economy cannot sustain further tax increases so there are no other options.

"I think everybody here would agree, Republicans and Democrats alike, that we would not want to make these drastic reductions that we're going to be making if we didn't have to," Niello said. "But the unfortunate fact is, we have to."

In a speech to California small-business leaders in Sacramento, Schwarzenegger lamented the various cuts he had proposed this month, saying, "Behind every one of those dollars that we cut there are real faces."

But he warned that "if we don't make those cuts, I think that we will face catastrophic consequences."

And Schwarzenegger isn't done yet. The governor's aides are expected to outline an additional $3 billion in cuts by Friday, responding to new projections showing that the deficit is larger than he originally anticipated.

During Tuesday's hearing, nonpartisan Legislative Analyst Mac Taylor suggested there were better ways to eliminate the shortfall that would allow the state to leverage federal dollars.

"You rightly were concerned about the draconian nature of some of those (cuts), because I think it's a whole difference from the kind of options you saw in the May revision or, frankly, the kind of options that we put on the table," Taylor told Evans.

Lawmakers and Schwarzenegger agreed in February to close $36 billion of a $42 billion budget deficit with a mix of higher taxes and spending cuts. But they used outdated data and underestimated the extent to which the economy would stall. Voters last week rejected $6 billion in other solutions.

State leaders face pressure to resolve the deficit quickly. California must borrow between $10 billion and $23 billion starting in July to pay its bills. To do so, the state needs to show investors that it has a balanced budget in place. Meanwhile, the state will lose the opportunity to cut money from the 2008-09 budget year that ends June 30 if leaders wait until July.

Schwarzenegger has ruled out tax increases, saying that voters who rejected last week's special election measures said they wanted no more taxes.

Call Kevin Yamamura, Bee Capitol Bureau, (916) 326-5548.