As serious negotiations began this week on the state budget, Democrats in the Legislature dropped a pair of proposals on the table that would increase Gov. Gray Davis' revised spending plan by $2 billion.

All the major players have now weighed in on how to solve California's worst-ever fiscal crisis ---- the governor, Republicans in the Assembly, Republicans in the Senate, and Democrats in both houses.

Meanwhile, a six-member Senate-Assembly conference committee is trying to hash out a compromise in time for the July 1 start of the new fiscal year, if not by the June 15 constitutional deadline.

Sacramento has run up nearly $11 billion in debts in the last two years and is headed into the red again in fiscal 2003-04, unless the state increases taxes and/or decreases spending.

In May, the governor proposed borrowing $10.7 billion to pay off the debts and balancing next year's budget by raising sales, car, income and cigarette taxes by $8 billion and trimming spending by about $2 billion.

Senate and Assembly Democrats this week offered similar plans, but with more modest cuts.

Local Republican lawmakers didn't exactly view the proposals as genuine moves toward compromise.

"We have a $38 billion deficit and they're increasing spending," said Assemblyman George Plescia, R-La Jolla. "They're going the wrong way."

Assemblyman Ray Haynes, R-Murrieta, expressed similar frustration.

"They are trying to spend us into bankruptcy," Haynes said. "To spend even more money next year is insanity. We're not going to do that, and as long as they insist on it, we are not going to have a budget. These guys have yet to deal with reality."

But Assembly Speaker Herb Wesson Jr., D-Los Angeles, said it is the GOP that needs to come to the reality that solving an unprecedented budget problem will require a "balanced approach," by which he meant one that relies on tax increases and program cuts.

However, the governor is cutting programs only a little, Republicans said, and Democratic lawmakers are afraid even to make the cuts he wants.

Wesson disagreed. "The Democrats have not been afraid of making cuts," the speaker said, referring to midyear reductions passed earlier.

Democrats control both houses with huge majorities, but they need eight GOP votes to pass a budget because of the constitutional requirement for approval by two-thirds super-majority.

The majority-party budget proposals differ slightly from house to house.

The Senate version, written by Sen. Wesley Chesbro, D-Arcata, proposes spending $72.3 billion in fiscal year 2003-04, $1.9 billion more than Davis' revised budget of $70.4 billion. And the Assembly version, sponsored by Assemblywoman Jenny Oropeza, D-Long Beach, proposes spending $71.9 billion.

Both versions count on receiving $1 billion from the federal government, because a federal tax cut signed last month by President Bush contains some aid for states.

The Assembly plan comes up with an additional half-billion dollars for programs by proposing to spend almost all of the $509 million reserve Davis wanted, according to Elizabeth Hill, legislative analyst.

Senate Democrats want to go further. Their budget proposes to spend more than the state takes in and would leave Sacramento $350 million in the red next year ---- even after selling $10.7 billion in bonds to erase the deficits run up the last two years, Hill's analysis shows.

Haynes was particularly critical of the Senate Democrats' deficit spending plan. And Plescia was critical of both Democratic proposals because they rely on the federal aid to prop up spending at a time of crisis.

"They wasted no time at all in spending that instead of putting it toward reducing our deficit," Plescia said.

The Democratic proposals contain the same amount of general fund money for kindergarten through 12th-grade schools as the governor's budget does, or $27.6 billion, which comes to $6,884 per student, Hill's report shows. But both plans add $200 million for community colleges and take away money from the University of California and California State University systems.

While the governor and Assembly Democrats would spend enough money to fund a 7 percent enrollment increase in the university systems, the Senate plan funds 4 percent growth.

The biggest differences are in health care.

The Assembly plan increases general fund spending for programs such as Medi-Cal, which pays for doctor visits by the poor, by $916 million, while the Senate package proposes an increase of $800 million.

Both plans reject Davis' strategy of trimming by 15 percent the amount that doctors are reimbursed for treating Medi-Cal clients, which would save $607 million. And the plans reject the governor's proposal to eliminate some optional medical benefits to save an additional $209 million.

Davis had targeted for elimination vision care, prosthetic limbs, hearing aids, hospice care, psychiatric care, chiropractic care and physical therapy, among other things.

Contact staff writer Dave Downey at (760) 740-3529 or ddowney@nctimes.com.