"That's the rumor I am hearing," Gatto said.
The rosiest scenarios have lawmakers reaching a budget consensus in August, still more than a month past the June 30 deadline, Gatto said.
Gatto backs a plan that would fill the multibillion-dollar gap in part with a tax on California oil producers and by leveraging dollars the state recieves from return deposits on recyclable bottles and cans.
He said the Assembly Democrats' budget would do more to protect education and social services than Gov. Arnold Schwarzenegger's proposal and does not call for tax increases on most Californians.
"The people of the state of California have been taxed to the bone," he said.
Gatto said 22 states have signfiicant oil production, and 21 of them levy severance taxes on producers.
"There's one state that doesn't have an oil severance tax," he said, "and you are sitting in it."
Citing a failure by state officials to economize at the beginning of the downturn, Gatto said he will propose legislation to require the state to do a three-year economic forecast when drawing up its budget.
He said he also wants to place before voters an amendment to the state Constitution requiring creation of a "rainy-day fund" in years when revenues exceed expenses.
While California has a rainy-day fund, the most recent effort to strengthen it failed in May 2009, when it was tied to Proposition 1A, a tax increase measure that voters rejected.
Expressing outrage over the enormous salaries and pension benefits for high-level staffers in the city of Bell, Gatto said he wants to pass a law requiring cities to cap salaries for top executives at no more than two or three times the annual salary of a judge in order for that city to participate in the state pension program.
Three Glendale police officers appeared shortly after the scheduled 4:30 start of the meeting and spoke quietly to Musurlian. Musurlian has clashed three times previously with Gatto or his campaign staff while trying to videeotape events or conduct interviews.
Escorted away by officers, Musurlian left the library, decrying what he called Gatto's "strong-arm tactics." In a later interview, Musurlian said he is acting independently of any political campaign or candidate and is merely seeking to exercise his 1st Amendment rights.