"I'm running out of money," says Federal Receiver Clark Kelso.
The federal lawsuit seeks to seize $8 billion dollars from California's cash-strapped treasury over five years. It also asks the judge to find Governor Schwarzenegger and other state leaders in contempt of court for refusing to hand over the money.
"I cannot permit the state's budget and fiscal meltdown to interfere with my federal Constitutional mandate to improve healthcare in California prisons," says Kelso.
Years of neglect and inadequate medical treatment in California prisons led a federal judge in 2006 to declare the healthcare system behind bars so poor, it violated inmates' Constitutional rights.
Kelso is supposed to correct the problems and wants to build seven new facilities and improve existing ones to treat 10,000 sick or mentally ill inmates. He felt the courts were the only way to go since Republicans have twice balked at approving that kind of money.
"I think people should be outraged, outraged that if you commit a crime, you're going to get better healthcare in prison than you get on the outside," says St. Sen. Jeff Denham.
"Eight billion dollars would give in prison a personal masseuse, a physical trainer, a dietician and probably a dog they can walk for all of them, and still have money in the bank for retirement," says Republican Minority Leader Mike Villines.
With the state budget now $15 billion in the hole and seven weeks late, the governor says he has bigger worries than the new lawsuit.
"I don't worry about that. Just, let's get the budget done and then everything will fall into place," says Gov. Schwarzenegger.
If Kelso wins and is allowed to take the $8 billion, it would worsen the state's finances, adding another $3 billion to the deficit just this year.
"I understand that when you play with the law and you evade the law, you're going to get caught. And today, California's been caught," says St. Sen. Gloria Romero.
Kelso already has a hearing date of Sept. 22nd, leaving just over a month for state leaders to avoid this legal showdown.