Meeting brings no progress on budget

SACRAMENTO — Gov. Arnold Schwarzenegger and legislative leaders convened Sunday night in hopes of ending a budget stalemate that is entering its sixth week, but they made no progress and dispersed after less than two hours, according to several participants.

“We have some big, deep differences, but at least we were together and we’ll just keep working through it,” Assembly Republican leader Mike Villines of Clovis said after the meeting in the governor’s Capitol office.

Lawmakers have been at odds over how to close a $15.2-billion budget gap, the largest since Schwarzenegger took office in 2003. Although the state’s fiscal morass has been apparent all year, the pressure for a resolution is extreme now because the state could run out of money by the end of September unless a budget is passed.

Last week Schwarzenegger laid off more than 10,000 state workers. He also issued an executive order that would cut the pay of other employees to the federal minimum wage of $6.55 an hour until a budget is signed. State Controller John Chiang has said he will not enact the pay cuts.

In early July, Democrats proposed $9.7 billion in new taxes on the wealthy and corporations, but Republicans -- who hold enough votes to block any budget -- have vowed not to support any tax increase.