California governor, lawmakers reach deal to resolve budget crisis

LOS ANGELES, July 20 (Xinhua) -- California Governor Arnold Schwarzenegger and legislative leaders said Monday evening that they have reached a deal to close the state's 26.3-billion-dollar budget gap.

The agreement, if approved in a final vote expected later this week, would end weeks of impasse, which has prompted the state to issue registered warrants, like IOUs, to those it owed money.

The deal doesn't include any broad-based tax increases strongly opposed by Schwarzenegger, and relies largely on deep cuts in government services to wipe out the deficit, the governor said.

Although most of the details have yet to be released, officials familiar with the negotiations between the governor and the legislative leaders have hinted that the plan would significantly cut back many social and welfare services to residents, particularly the elderly and the poor, for years.