SACRAMENTO -- Assembly Speaker Herb Wesson plans to offer a budget plan today that includes $1 billion in new spending cuts but also a half-cent sales tax increase and a hike in income taxes paid by the state's highest earners.

The speaker's proposal comes after Republicans in the Senate have twice rejected a similar budget plan from Democrats that included only the sales tax increase.

Wesson, D-Culver City, said he will propose the plan knowing it's almost certainly dead on arrival.

"You have to fight for what you believe in," Wesson said. "But we are at a stalemate. I haven't a clue what it's going to take to move the Republicans along."

Wesson and most of the other Democrats in the Assembly spent much of the week traveling throughout the state, talking with local officials and community leaders in hopes of generating support for higher taxes to help erase a record $38.2 billion budget shortfall.

The trips focused on Republican districts.

Wesson said the meetings went better than he'd expected, but he acknowledged there remains an uphill battle for GOP support.

Democrats have majorities in both the Senate and Assembly but they need at least eight Republican votes -- two in the Senate and six in the Assembly -- to put together the two-thirds majority required to pass a budget.

The state's new fiscal year starts Tuesday and state Controller Steve Westly said a long budget deadlock could leave the state dangerously short of cash and unable to make millions of dollars in payments.

Assemblyman John Campbell, R-Irvine, said his caucus is willing to hold out as long as it takes to get a budget without tax increases.

"We are ready to talk and to negotiate and to work on this budget," he said.

"As soon as they accept that this budget will not have tax increases."

Democrats say they've cut as much as they're willing to cut from state programs to eliminate the shortfall.

Neither house took a budget vote Thursday, but both argued about who was to blame for the lack of movement toward a budget agreement.