A newly-unveiled proposal from the Assembly Budget Committee rejects Brown's cuts to welfare, child care, in-home care and college financial aid. To offset those cuts, it reduces the governor's proposed billion-dollar reserve by about 40 percent and cobbles together some other savings. Meanwhile, Senate Leader Darrell Steinberg says legislative Democrats want to reach a deal with the governor - but they're prepared to go their own way if necessary. Then, unprompted, he brought up Brown's line-item veto power:
Steinberg: "The governor has a blue pencil here. The governor has constitutional - and I'm not encouraging him to use it (laughter). No, I'm not! But I think it's an important fact."
Whether there's a deal or not, both chambers are expected to hold their budget debate and votes on Friday.