Is California's long state nightmare finally over?

Reports out of Sacramento suggest legislators and the governor have reached a budget deal

By Andrew Leonard
Published July 21, 2009 10:01AM (EDT)

The Sacramento Bee is reporting that California governor Arnold Schwarzenegger and state lawmakers have reached a deal breaking the budget impasse that has made the Golden State the laughingstock of the global financial meltdown.

The proposal includes spending cuts to programs ranging from schools to welfare-to-work to prisons. It takes money from local governments, including borrowing $2 billion that the state will repay starting in 2013 and taking gas taxes that normally go toward local road projects.

But Democrats also ensured that California will pay $9.5 billion to education once the state's economy rebounds as compensation for 2008-09 school cuts. They also avoided suspending Proposition 98, the state's constitutional guarantee for education funding.

More details will no doubt emerge as the deal goes to the state House and Senate for a vote later this week, but judging by those two paragraphs, a lot appears to be riding on that hoped-for "rebound."

Andrew Leonard

Andrew Leonard is a staff writer at Salon. On Twitter, @koxinga21.

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