STATE : State Budget Accord Reached; $800 Million in Tax, Fee Hikes

Gov. George Deukmejian and leaders of the Legislature, capping a record 27-day impasse, announced today that they have reached agreement on a state budget for the fiscal year that began July 1.

The budget includes nearly $800 million in tax and fee increases, contains a variety of cuts and curtails some automatic cost-of-living increases, they said.

The $50-billion-plus budget includes an automatic “trigger” sought by Deukmejian--a mechanism that will automatically limit spending each year if there is an unexpected decline in revenues.

The state has gone nearly a month into the new fiscal year without a budget, the longest period in the state’s history without a spending plan.

The hangup was caused by lawmakers’ inability to agree on how best to cover a $3.6 billion revenue shortfall.

“Now, we’ve got this proposal to present to the legislators. Hopefully, they will pass it as quickly as possible,” Deukmejian said. But, he added, “it’s always hard to get a two-thirds vote (in the Legislature).”