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Tension Surfaces in State Budget Talks

Signs of tension have surfaced in California´s budget negotiations after talks ended Wednesday without resolution of the last remaining major issue.

The stumbling block is Governor Schwarzenegger´s plan to take 2.6 billion dollars from cities and counties in the next two years to close an estimated 17 billion dollar deficit.

Negotiators say they´ll resume talks again Thursday.

But there´s a growing sense that local officials may not be able to reach agreement with lawmakers over the reform package — an impasse that puts 2.6 billion dollars in savings to the state in jeopardy.

The budget is three weeks past the constitutional deadline.