California lawmakers pass budget on $15.7B deficit

SACRAMENTO, Calif. (AP) ? Democratic lawmakers on Friday approved a plan to balance California's $15.7 billion deficit without Gov. Jerry Brown's endorsement so they can keep collecting their paychecks.

The Senate passed the main budget bill, which has fewer welfare cuts than the governor proposed, on a 23-16 vote. The Assembly later passed the measure on a 50-25 vote.

In introducing the Democratic spending plan, Senate Budget Committee Chairman Mark Leno of San Francisco called it "a budget which is painful yet hopeful, sobering yet with vision."

Assembly Budget Chairman Bob Blumenfield said lawmakers tried to soften the most severe cuts to social services and proposed "more compassionate alternatives to some of the governor's proposals."

Republicans called the plan incomplete and urged Brown to veto the budget bill.

"This budget is full of borrowing and gimmicks," said Sen. Bill Emmerson, the ranking Republican on the budget committee. He objected that the budget documents were kept secret until just hours before the vote.

"This budget assumes passage of an unpopular tax initiative that is likely to be voted down. You know it and I know it," he said.

Brown did not indicate Friday whether he would sign or veto the bill. Gil Duran, a spokesman for the governor, said negotiations were continuing.

In passing the bill, lawmakers met a midnight deadline to pass a balanced budget and won't lose their pay. California lawmakers do not receive pensions but are the highest paid in the nation with a base annual salary of $95,290. Nearly all receive additional tax-free per diem payments of about $30,000 a year.

Last year the governor vetoed the budget passed by Democrats, calling it unbalanced. The state controller withheld 12 days' pay but a judge has since found that the controller has no authority to block paychecks because it violated the separation of powers clause of the California Constitution.

Republican lawmakers had asked the state controller and treasurer to evaluate whether the Democrats' latest budget is balanced.

Treasurer Bill Lockyer responded Friday, saying the plan is "financeable" and would allow the state to borrow about $10 billion for cash flow needs for the fiscal year.

The budget assumes voters will approve Brown's initiative on the November ballot to raise the sales tax by a quarter cent and increase income taxes for people who make more than $250,000 a year. Democrats propose filling the remaining shortfall with a combination of cuts and shuffling funds.

Brown's tax measure is projected to raise $8.5 billion through mid-2013. If voters reject the tax hike, schools and other public entities would be subject to severe automatic cuts, which include shortening the school year by several weeks.

A Field Poll released last week showed that a slim majority of likely California voters, 52 percent, support the initiative, and 35 percent were opposed, with the rest undecided. The poll, conducted in late May, had a sampling error margin of plus or minus 3.8 percentage points.

Democrats worked on two tracks to pass a budget and continue negotiations with Brown on several sticking points, particularly welfare cuts. Democrats lack Republican support for a two-thirds override if Brown vetoes the plan.

"We have worked closely with the governor all year, and there are small but important differences to resolve in the coming days," Senate President Pro Tem Darrell Steinberg said in a video released Friday on YouTube. He told reporters later that he had not met with Brown Friday and there was no resolution of their remaining disagreements.

After Friday's vote, Steinberg said he expected the governor may not act until all the bills are before him. The Legislature passed only a few of the companion bills needed to enact the entire budget.

Democrats agree with the governor on many aspects of his $91.4 billion spending plan but their plan doesn't save as much as the governor proposed. They sought to minimize the amount of cuts they have to make by slashing his proposed reserve fund from $1 billion to about $500 million.

They are urging the governor to back off from plans to cut programs that assist the poor, but Brown maintains the reductions are needed to help bring the state back to fiscal balance.

Democrats are resisting deeper cuts to the state's welfare-to-work program known as CalWORKS, child care assistance for low-income families, in-home supportive services, and eliminating Cal Grants for students who attend private colleges.

The two sides disagree on how to distribute money to local governments that once went to community redevelopment agencies. Brown also has proposed a 5 percent reduction in state worker pay that still must be negotiated with unions.

On Friday, dozens of demonstrators lined the Capitol Rotunda, carrying signs and arranging strings of light bulbs into heart-shaped displays. Most were there to protest cuts to funding for in-home health care service providers. Many were in wheelchairs or used walkers to navigate the Capitol.

More than two dozen demonstrators have been arrested for disrupting the Capitol in recent days, though they stood or sat peacefully Friday as they waited for lawmakers to act.

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Associated Press writers Don Thompson and Hannah Dreier contributed to this report.

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