SACRAMENTO, Calif. — Lawmakers on Friday approved a complex package of spending cuts, local government raids and accounting maneuvers to fill California’s gigantic budget deficit, providing hope that the state might begin a slow climb out of a deep financial hole.
The legislative package of about 30 bills, with final passage coming in the Assembly in the afternoon after an all-night session, was similar to the deal announced this week by Gov. Arnold Schwarzenegger and legislative leaders from both parties.
But the Assembly rejected two of the most controversial measures: a plan to take about $1 billion in transportation funding from local governments, and allowing oil drilling off the California coast for the first time in 40 years. That was to have brought in $100 million this fiscal year.
The loss of $1.1 billion from the budget package means Schwarzenegger will have to use his authority to make even deeper cuts to close the gap. The Assembly cuts do not appear to be deal-breakers, with Schwarzenegger saying he would be finishing up the package next week.
He acknowledged that the budget deal will mean teachers are laid off, college students will pay more and many people will suffer, but he said lawmakers had few options.
“It’s the only way to solve the problem and to save our great state,” he said. “The only way to do it is to spread the sacrifice. It saves our state from financial ruin and from drowning into the fiscal abyss.”
The spending cuts amount to roughly 60 percent of a budget deficit projected at $26 billion through June 2010.
The size of the shortfall is unprecedented, representing nearly 30 percent of the state’s $88 billion general fund.
