California Legislature approves budget

After days of tense negotiations, California lawmakers finally approved a new budget early Thursday, breaking a three-month deadlock that had plunged the state into a budget crisis, Xinhua reported.
The budget envisages major program cuts and 12 billion dollars in tax hikes to addresses the state's 42-billion-dollar massive deficit.
Senator Abel Maldonado provided the final Republican vote needed to pass the budget in exchange for an agreement by Democrats to rewrite election rules that Maldonado said had allowed the Capitol to become paralyzed by partisanship, leading the state to the brink of financial ruin.
At least three Republican votes are needed in each house to pass a budget, which must be approved by a two-thirds majority of the Legislature.
"I am extremely proud of the members of the legislature, both Republicans and Democrats, who had the courage to stand up and put the needs of Californians first," Governor Arnold Schwarzenegger said in a statement.
"Rather than approaching this unprecedented crisis with gimmicks and temporary solutions, we took the difficult but responsible steps to address our entire 42-billion-dollar budget deficit and pass historic bipartisan reform measures," the governor said.
He said the legislature used his budget proposal as a blueprint for this budget and included each element of the four-legged stool: spending reductions, revenue increases, economic stimulus and government efficiency.
The final plan includes billions of dollars in cuts to schools, healthcare institutions, higher education and programs for the poor. If signed by Schwarzenegger, who helped devise the package, it also would raise personal income taxes and the state sales tax, although a 12-cent per-gallon increase in gasoline taxes was eliminated in the final hours. The gas tax would be replaced with federal economic stimulus money.
The budget was approved after midnight, following seven unsuccessful votes held throughout the day and into the night in Sacramento, capital of California.
California's financial state had deteriorated to the point where Schwarzenegger ordered layoffs of 10,000 state workers and the suspension of hundreds of public-works projects. Early income- tax refunds have been delayed, and public anger has grown.
"This is a very difficult budget, but we have turned this crisis into an opportunity to make real, lasting reforms for California," Schwarzenegger said. "Some special interests may not like this budget -- but like I always say, what's good for the people is not always good for special interests."
He called on legislators to partner with the people to "make sure these bipartisan reform measures are passed to put an end to our budget roller coaster and get California moving forward again.

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