Sam Blakeslee has good news and bad news about the state budget

Assemblyman Sam Blakeslee, the Republican minority leader from San Luis Obispo, held up his hands in victory Friday when he told about 75 local business people that the state’s financial situation is secure through January.

The crowd chuckled.

“We came that close to going over (the cliff),” Blakeslee said, noting the mix of humor and seriousness in his gesture.

Some of the help came from selling $8.8 billion in short-term notes — a bond that matures in less than one year and the only kind of debt that the state can get into without voter approval — to boost the state’s cash flow, he said.

How to carry on afterward, Blakeslee added, is still a question mark — including how to fill an anticipated $8 billion to $10 billion hole the state must plan for next year.

The San Luis Obispo resident, now in the middle of his third and final term for the 33rd Assembly District, was the featured speaker at a San Luis Obispo Chamber of Commerce’s lunch at the San Luis Obispo City/County Library.

Some insight into the state’s fiscal troubles could be revealed next year, he said, through state employees.

“So much of the budget is tied up in salaries and benefits,” he said. Many state union contracts are up this year and will be back on the table.

Those changes could affect “head count or the re-negotiation of contracts,” he added.

In his talk, Blakeslee described his five years in the Assembly — a period that allowed him to see a robust $102 billion state budget fall to a financial situation that Gov. Arnold Schwarzenegger once called the worst budget in state history.

Blakeslee spoke about how the Legislature came together in February to craft budgetary compromises and how those ideas were overwhelmingly knocked down at the polls in May.

He then described the fallout of cynicism that Sacramento experienced afterward, saying how many thought the state system was so fundamentally flawed, the way to fix things was to allow it to crash and burn before it could rise from the ashes.“I don’t subscribe to that,” he said. “I actually believe we can save the state.”

That’s why Blakeslee hopes to inspire Sacramento to get back to work.

“My challenge is how to get the folks’ chins back up and work toward one goal again,” he said.

Subsequent budget reforms he described since May included rewriting the rules of how dollars in the state welfare program CalWORKs are spent, changing up the In Home Supportive Services program that serves the elderly and disabled, altering how the state manages its surplus property and eliminating various state boards and commissions.