Budget, Budget Crisis | featured news

California Governor Arnold Schwarzenegger and lawmakers failed on Wednesday night to agree to balance the state's budget by closing a $26.3 billion deficit, but officials said talks would continue.

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.

A pro-marijuana group is launching another television bid to legalize pot in California — this time with the pitch that legalizing and taxing the drug could help solve the state's massive budget 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.