California, Arnold Schwarzenegger | featured news

Legislative leaders emerged from late-night budget negotiations Tuesday to announce they were closing in on a final agreement on how to address the state's $26.3-billion deficit.

California's lawmakers failed to agree on a balanced budget by the start of its new fiscal year on Wednesday morning, clearing the way to suspend payments owed to the state's vendors and local agencies, who instead will get "IOU" notes promising payment.

A plane carrying California Governor Arnold Schwarzenegger has made an emergency landing in Los Angeles because of smoke in the cockpit.

Gov. Arnold Schwarzenegger vowed Wednesday to let California government come to a "grinding halt" rather than agree to a high-interest loan to keep the state afloat if he and the Legislature do not close the yawning budget gap in coming weeks.