``At this point we feel really good,'' he told reporters.
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Legislative leaders reach deal on state budget
CHILDRENS' HEALTH INSURANCE STRIPPED FROM THE PLAN

By Edwin Garcia
Mercury News Sacramento Bureau

SACRAMENTO - Legislative leaders announced agreement Monday on a $131 billion state budget, capping more than two weeks of negotiations that stalled over a dispute about whether to provide health insurance for illegal immigrant children.

The $23 million that Gov. Arnold Schwarzenegger proposed for the children's insurance was removed from the budget, Assembly Republican Leader George Plescia told the Mercury News immediately after leaving an afternoon meeting in the governor's office.

``The health-care issues have been taken out of the budget; it was going to hold the budget up,'' Plescia said. ``Otherwise,'' he added, ``we weren't going to get a budget done.''

Assembly Speaker Fabian NĂșnez, who declined to release details of the negotiations, said he was pleased with the outcome.

``At this point we feel really good,'' he told reporters.

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