Senate Passes Tentative Budget Compromise
The California State Senate spent all night trying to make things balance. At 6:30 a.m., they came up with a compromise that everyone in their house could live with.
Now it's up to the Assembly to vote on a package of 30 bills that would close the $26.5 billion budget gap.
Senate spokeswoman Alicia Trost told CNN that Assembly members were having a hard time with a bill that would repay $11 billion owed to schools. The other bills included $24.2 billion in deficit-reduction steps and $921 million from reserve funds.
In addition to the reserve, the package includes $15.6 billion in cuts to all parts of government, $3.9 billion in "revenue solutions" (steps to increase money coming in), $3.1 billion in borrowing from local governments, $500 million in fund shifts and $1.2 billion in deferrals.
"The bipartisan solution was the product of several months of negotiations and public hearings on how to address the historic downturn in the economy by responsibly cutting all areas of government while keeping the state's social service safety net intact," according to a statement issued by the office of Senate President Darrell Steinberg.
On Tuesday, Governor Arnold Schwarzenegger announced a tentative agreement to eliminate the deficit. Legislators have been negotiating since the announcement to fine-tune the specifics of the deal. Local legislators told KHTS on Tuesday that they don't expect all the details to be complete until the legislature comes back from a recess in August.
On July 2, the state began issuing IOUs to its vendors, which banks accepted for a short window of time.