Budget Negotiators Cut Funds for Conservation Effort : Environment: Plans call for eliminating state money for a program to save the gnatcatcher while not threatening the building industry.

In a move that has upset environmentalists and developers alike, budget negotiators have slashed state funding for a habitat conservation program aimed at saving the threatened California gnatcatcher without wounding Orange County’s building industry.

Backers of the conservation effort, heralded as a national model for protecting endangered species, held out hope Friday that lawmakers would eventually reinstate at least part of the nearly $800,000 requested for the coming year.

“We’re working with them and hope they’ll provide the necessary funding,” said Michael Mantell, state Resources Agency undersecretary.

If the state money does not materialize, it would raise serious questions about what role California officials would have in the conservation effort they launched only two years ago. Some worry the lack of money could kill the effort.

“Everyone is in a complete panic about it,” said Steve Johnson of the Nature Conservancy, which has backed the habitat plan. “Whether or not this is a great program, whether or not it’s a national model, it doesn’t work if there’s no money. Words of praise need to be matched with dollars.”

The federal government is expected to provide $2 million next fiscal year to protect the coastal sage scrub that is home to several rare species of plants and animals, including the gnatcatcher. The small gray songbird, which nests in wide swaths of sagebrush in Orange County and in San Diego and Riverside counties, was listed as a threatened species in March by federal wildlife authorities.

In listing the bird, Interior Secretary Bruce Babbitt linked his decision to California’s habitat conservation plan, which Gov. Pete Wilson launched in 1991 as an experiment to create preserves for entire ecosystems instead of lone species. The conservation plan would allow developers to build on some land without delay as long as they follow strict rules.

Some boosters of the program worry that the federal funds could be jeopardized if the state does not provide money for the habitat preservation program.

“It wouldn’t take too much for the whole arrangement to come unraveled if the state demonstrates a lack of commitment to the program,” said Tim Neely, Orange County planning and zoning administrator.

“This is a partnership,” Mantell said, “and it makes it harder to ask the federal government to participate if the state itself isn’t stepping up to the plate.”

Should the program be scuttled, there could be reverberations across the state, Johnson said. More than one-third of the state’s territory harbors rare plants and animals teetering on extinction, meaning that control of land use would fall largely to the federal government should the state’s conservation program dissolve, Johnson said.

“It would mean basic land-use planning is taken away from the state and vested in the federal government,” Johnson said. “I don’t think anyone wants that, including the federal government.”

Assemblyman Tom Umberg (D-Garden Grove) and several other Southern California lawmakers have approached colleagues immersed in the budget negotiations to ask that money for the habitat conservation program be reinstated.