July 2, 2009 Schwarzenegger declares fiscal emergency Play video

(NECN/ABC) - With the state budget still unresolved, California Governor Schwarzenegger today declared a fiscal emergency, and ordered new measures to save money. Governor Schwarzenegger was none too pleased the Legislature failed to send him a budget revision before the fiscal year ended at midnight.

The governor blasted lawmakers for the last four weeks they spent pouring over his proposals. "They decided to have endless amounts of hearings and debates, finger- pointing and assign blame. At the end of the day, nothing was accomplished." To move things faster, the Governor: Declared a state of fiscal emergency forcing lawmakers to act within 45 days or else they cannot adjourn, ordered a third unpaid furlough day for state workers, and vowed not to sign any new laws until the deficit is fixed.

The Governor told lawmakers they have to get serious. "In the midst of a budget crisis, they're debating about cow tails." The missed deadline almost makes certain California will not be able to pay most of its July bills and that IOUs will go out tomorrow. Assembly Republicans introduced a bill that would allow Californians who receive IOUs to be able to pay almost any state fee or taxes with that IOUs.

Meanwhile, that third furlough day means most state offices will close on the first, second and third Friday of each month. Workers are angry because that basically amounts to a 14% pay cut.

Nanette Miranda reports for ABC News