California lawmakers fail to pass stopgap measure to avoid IOUs, budget deal remains distant

California Senate rejects cash-saving proposal

SACRAMENTO, Calif. — Republicans in California’s Senate have blocked a complicated cash-saving maneuver intended to help the state avoid issuing IOUs for services provided by thousands of independent contractors.

The move would have temporarily cut and delayed billions in education funding, raising concerns among officials that it could further strain K-12 and university finances.

The state Assembly approved the measures Thursday afternoon, but the Senate fell short of the necessary two-thirds vote.

The Legislature scheduled a third day of meetings Friday, but Democratic and Republican lawmakers remained at odds over how to solve the state’s $24.3 billion shortfall, less than a week before the beginning of the new fiscal year.