THE STATE BUDGET CRISIS : State Faces Prospect of Issuing IOUs to Pay Bills : Economy: Utility company, and most banks, will give the state some leeway in solving its fiscal crisis. Lenders are seen as a key element in allaying people’s fears.

Here’s a glimmer of good news for Gov. Pete Wilson and the state’s legislators as their budget wrangling goes down to the wire:

At least the lights won’t all go off at once if the state has to resort to paying its bills with IOUs on Wednesday.

“We wouldn’t randomly turn everything off,” said Tony Ledwell, a spokesman for Pacific Gas & Electric, the giant San Francisco utility. “We would treat the state government like any other customer. We would be willing to sit down and negotiate.”

Beyond that, uncertainty reigned Monday as banks, food suppliers, stationery vendors, counties, welfare recipients, fuel oil suppliers, landlords and others who expect payment from the state confronted the prospect that California might for the first time since the Great Depression be forced to issue promises of future payment for goods and services. With the Legislature and the governor in a deadlock over how to eliminate a $10.7-billion budget deficit, that could happen as early as Wednesday, the start of the new fiscal year.

How banks respond will be a key element, all parties agree. Bank policies could help allay fears and uncertainties--or exacerbate them.

“By and large, the majority of banks in the state will accept registered warrants for existing retail customers,” said Nancy Badely, a spokeswoman for the California Bankers Assn. in San Francisco. That means that banks--at least for the first 30 days--would give most regular customers immediate access to the cash; the banks would hold on to the warrants and redeem them in bulk, at 5% interest, once state funds become available.

“We will take care of our customers to make sure they don’t suffer a cash crisis,” said Curtis S. Reis, chairman and president of Alliance Bank, a small Culver City institution. “We’re not wild about it, but we will honor (the warrants).”

There was at least one notable exception to the banking association’s statement, however. The state’s largest bank, Bank of America in San Francisco, with more than 1,400 branches statewide, declined Monday to establish its policy.

“We’re looking at the situation very carefully,” said spokesman Richard Beebe. “We will announce publicly our policy of handling registered warrants soon, but we’re not prepared to yet.”

Badely advised that all warrant holders--especially vendors and other commercial customers--would need to confer with individual banks before trying to cash IOUs. The association’s suggestion: To cut down on the possibility of theft and fraud, do not deposit the warrants by mail, and check with the bank before depositing them in automated teller machines.

The state has enough cash to cover the July 1 paychecks that have already been issued for most state employees. But the California State Employees Assn. said 10,000 to 20,000 employees who are to be paid July 15--including Caltrans field workers and employees of the state printing plant--could be the first employees to receive registered warrants. The 300 printing plant employees were also paid late at this time last year because of budget wrangling.

“The ironic thing about the state printing plant,” said Pat McConahay, a spokeswoman for the employees association, “is that it prints the budget.”