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ByJonathanJ.Cooper TheAssociatedPress SACRAMENTO Gov. Jerry Brown signed a state bud- get Monday that uses a slice of California's revenue sur- plus to boost assistance for the poor and send more money to universities but keeps other new ongoing spending commitments to a minimum. In negotiating with Dem- ocratic legislative leaders on the $122.5 billion spend- ing plan, Brown secured a commitment to boost the state's rainy day fund, pay down debts and use cash instead of debt for build- ing maintenance and con- struction. Using billions for savings and one-time purposes is a victory for the Democratic governor, who warns re- peatedly that California's current budget surpluses are based largely on capi- tal gains income of wealthy taxpayers. That revenue will quickly plummet dur- ing economic difficulties, he says, forcing the state to take back money approved during the boom times. In releasing his budget proposal last month, Brown suggested he'll be judged on how well the budget weath- ers the next recession. His predecessors saw their pop- ularity plummet when they were forced to accept steep spending cuts, he said. "I don't want to repeat these errors, because we had two governors who were riding high. And par- adoxically, that very mo- ment when everyone's feel- ing the best is the very mo- ment when the recession is about to hit," Brown said. "So instead of pulling back in the last two recessions, the state of California ac- celerated its spending and therefore made the budget cuts all the more painful." Brown negotiated the spending plan with Assem- bly Speaker Anthony Ren- don, D-Paramount, and Sen- ate President Pro Tem Kevin de Leon, D-Los Angeles. The budget includes a $2 billion additional deposit in the state rainy day fund on top of the $1.3 billion contri- bution required by the state constitution, bringing the total balance to $6.7 billion. The budget also includes a regular reserve of $1.75 bil- lion to cushion against a drop in revenue. Another $2 billion was earmarked for deferred maintenance and state building construction. Brown also secured $270 million in bonds for jail construction, though he would have preferred to use cash. Democratic lawmak- ers fought unsuccessfully to cut the jail funds that they say would be better spent on rehabilitation programs. Lawmakers agreed ear- lier in the year to reserve $240 million to fund future health care costs for state workers once they're re- tired, a priority for Brown. However, Brown has made little progress in his quest to raise taxes or fees to fix crumbling highways. And despite his reluc- tance to bless new ongoing spending, Brown gave in to several priorities for Dem- ocratic lawmakers, includ- ing an expansion of state- funded day care that will eventually cost $500 mil- lion a year. He also agreed to repeal a welfare policy known as the maximum family grant, which de- nies additional aid to fam- ilies that have more chil- dren while receiving aid, at a cost of more than $220 million a year. A special account will take over the long-term cost, limiting the general fund hit to the next three years. The spending plan was approved by lawmakers June 15 with only one Re- publican vote. GOP lawmak- ers said the budget sets the state on the course for def- icits despite Brown's effort to limit costs that continue from year to year. They also criticized the lack of fund- ing for road construction. Brown said last month that the state will see a budget shortfall of $4 bil- lion by 2019 unless voters in November decide to renew temporary tax hikes on the rich. The nonpartisan leg- islative analyst disagreed with that finding, project- ing budget surpluses in each of the next four fiscal years even if the tax hikes expire. The budget raises vehi- cle registration fees from $70 to $80 a year starting in April, to generate $400 mil- lion a year for the Depart- ment of Motor Vehicles, Cal- ifornia Highway Patrol, Air Resources Board and other departments. Brown and legislative leaders agreed to set aside $400 million for low-in- come housing, assuming lawmakers and Brown can agree on a plan to bypass construction review pro- cesses in certain neigh- borhoods. The policy has drawn strong opposition from neighborhood activ- ists who fear it will allow developments that change the character of their com- munities. CALIFORNIA Gov.Brownsignsbudgetofmorethan$122billion By Rich Pedroncelli The Associated Press LAKEISABELLA Sallie Keel- ing had seen enough pho- tos of destruction over four days to know what to ex- pect when she returned Monday to the fire-ravaged neighborhood where she and her husband had lived for 13 years. "There's nothing," she said, covered in soot after digging through the rubble. "Just ashes." Keeling, 71, surveyed the devastated South Lake near Lake Isabella as evacuation orders were lifted in some nearby communities that suffered less damage from the wildfire that killed two people and destroyed 200 homes in the southern Si- erra Nevada. The fire grew to more than 70 square miles, but was it 40 percent contained as it burned in steep ter- rain south of Lake Isabella. Houses could be vulnerable if winds blow the fire back toward some of the commu- nities in the popular recre- ation area, Fire Chief Brian Marshall said. "There's still more threats out there," Marshall said. "This is going to go down as the most destruc- tive wildfire in Kern County history." Cadaver dogs searched through the rubble of dev- astated neighborhoods for more possible casualties, though remains found over the weekend were identified as an animal, Kern County sheriff's spokesman Ray Pruitt said. The cause of the fire re- mains under investigation. A man with two guns was arrested Sunday in a man- datory evacuation area, though further details weren't available on possi- ble charges he could face, Pruitt said. The fire began Thursday and quickly exploded in dry brush and bore down on small communities of houses and mobile homes that surround Lake Isa- bella, a dammed section of the scenic Kern River pop- ular for fishing, whitewa- ter rafting and other out- door activities. Terrifying flames ar- rived with little warn- ing and residents, many elderly, had to flee amid heavy smoke. "People were escaping barely within an inch of their lives," Marshall said. The bodies of an elderly couple, apparently over- come by smoke, were found Friday. Their names have not been released. In addition to the de- stroyed homes, another 75 were damaged. The fire was the most damaging blaze in Cali- fornia, but it is just one of many that have burned large swaths of the arid West during hot weather. Keeling poked through debris and twisted metal in a vain search for a safe-like metal box. She unearthed a charred jewelry box, but most everything else was a total loss, including a Chevy pickup truck and small car that sat on their axles nearby. Her husband, Steve Keel- ing, said he inherited the house and the ashes of his parents' remains had been inside. They always wanted to spend eternity in that place and now it seemed they would. SIERRA NEVADA Central California wildfire called 'most destructive' in county history RICHPEDRONCELLI—THEASSOCIATEDPRESS Lucas Martin stares at a cup found in the ashes of his fire-ravaged home in South Lake on Sunday. The Associated Press SACRAMENTO California senators have approved a $2 billion bond to build perma- nent housing for mentally ill homeless people. The plan senators passed would use money from an existing fund for mental health care financed by a tax on millionaires that vot- ers approved in 2004. 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