The California state budget crisis is directly impacting many of Sacramento Metro Chamber member businesses, a recent survey on the economy shows.

Just over 67 percent of those who responded to the Third Quarter Metro Insights survey indicated that they are being hit hard by state budget issues, and more than 25 percent said they were expecting to receive an IOU from the state, causing significant enough cash flow problems that they may need to reduce operations and/or employment.

Another 28 percent said their banks would not honor the state IOUs, but those businesses expected they could get by for now. Only 15 percent said their bank would take the IOUs.

“Even though the state now has a budget—of sorts—the financial crisis is still ongoing and threatens small businesses,” said Matt Mahood, Metro Chamber president & CEO. “We urge both state and local governments—and banks—to recognize that our region’s economic recovery relies on the ability of small businesses being able to stay open and keep their workers employed.”

Mahood noted that nearly 25 percent of the total jobs in the six-county region are government related, and that the health and well-being of that industry sector significantly influences the local economy.

The survey was conducted in July with 558 businesses responding. More than 60 percent of those replying had 50 or fewer employees.