After All-Night Session, California Lawmakers OK Budget 100 Days Into FY11

SAN FRANCISCO — After a session that dragged on all night, California lawmakers passed a budget this morning — 100 days after the fiscal year began.

Lawmakers and Gov. Arnold Schwarzenegger wrangled for months over how to fill a $17.9 billion budget gap.

Legislative leaders and the governor eventually agreed on a plan that uses increased revenue assumptions and the deferral of some obligations into fiscal 2012.

At Schwarzenegger’s insistence, the budget deal also includes a lower pension-benefit tier for future state employees, and sends voters a 2012 ballot measure to establish a stronger rainy-day budget reserve.

The budget votes were scheduled Thursday morning, but lawmakers remained in session all night as leaders tried to wrangle votes from reluctant back-benchers.

In the end, the budget passed each chamber with the bare minimum of votes needed for the required two-thirds supermajority passage.

The Assembly adjourned after 6 a.m., and the main budget bill passed the Senate after 7 a.m.

Passage of the budget is expected to clear the way for the state treasurer’s office to conduct its annual cash-flow borrowing.

Treasurer Bill Lockyer has said he plans to privately place up to $5 billion in short-term notes with Wall Street banks as a bridge loan to fund operations until the state can go to the public markets with up to $10 billion of revenue anticipation notes by the end of November.

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