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Calling it a plan "that has been tweaked a bit," legislative leaders say they think they're closer to a budget agreement with Gov. Jerry Brown, though there's no sign that Brown is willing to go along - especially on the issue of changes to the state's welfare assistance program.

Assembly Speaker John Perez and Senate President pro Tem Darrell Steinberg say both houses will vote on a newly revised plan Friday, just hours before the midnight June 15 deadline by which legislators will lose their salaries if they fail to take action.

Democrats say their proposal -- which presents alternatives to the governor's plan worth about $1 billion -- is frugal but fair.

"It is our obligation to make sure that while we cut," said Steinberg, "that we don't cut just to make a point."

The legislative plan restores $1.2 billion in gubernatorial cuts, offset by about $900 million in new solutions. It also relies on leaving a smaller budget reserve ($544 million) than called for by Brown ($1 billion).

This is the second alternative budget floated by legislative Democrats this week, with Monday's proposal effectively rejected by the governor in his Tuesday afternoon written statement.

In this iteration, the budget would include diverting $250 million in local property taxes from county governments to schools. It also would rework some details under the state's overall school funding guarantee, Proposition 98.

But there continues to be disagreement over cuts to social services, most notably the welfare-to-work program, CalWorks. Democrats have restored about half of Brown's CalWorks cut, and have rejected his insistence on quickreinstatementof work requirement rules that were suspended in 2010.

The governor specifically highlighted welfare assistance in his Tuesday written statement, perhaps a hint that it could be the biggest of the sticking points.

"We need additional structural reforms to cut spending on an ongoing basis," wrote Brown, "including welfare reform that's built on President Clinton's framework and focused on getting people back to work."

Policy goals notwithstanding, welfare assistance has also been a potent political issue through the years. Clinton's own 1996 effort came just months before winning a second term in office.

In California's 2010 race for governor, GOP nominee Meg Whitman championed changes that would shorten the time families could receive assistance. And observers note that welfare 'reform' continues to resonate with swing voters -- the same kind of voters Brown needs to ratify his November tax increase initiative, a key element to the budget he'll sign by month's end.

But legislative Democrats remain wary of the governor's proposal.

"Reform is a loaded word," said Senate leader Steinberg in a Wednesday afternoon briefing with reporters. The Sacramento Democrat said changes that tell "those living on the edge" that they can no longer receive help "is something we are very concerned about."

For now, the governor's spokesman continues to say that negotiations are "ongoing," though the pressure will surely mount. Senate budget writers will convene Thursday to move the Democratic budget proposal toward a floor vote on Friday -- giving the public (not to mention legislative Republicans) just about a day to read the latest changes.

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