They don’t sound panicked. Some even laugh ruefully when the subject comes up. For state employees, the California budget crisis has turned into an annual rite of early summer -- complete

with a forecast of June doom that, up to now, has never quite come true. So as this fiscal year draws to a close June 30 -- with no budget in sight, warnings of possible layoffs arriving in

the mail, rumors of pay cuts swirling and legislators grinding on in fruitless deliberations -- many state workers remain remarkably unperturbed. “It hasn’t been the top of the lunch hour,”

said Claudia Ward, 55, a judicial secretary in the Court of Appeal at the Ronald Reagan state office building downtown. We’ve been here before: That’s the essence of what state employees in

do,” said David Booker, 51, a law enforcement officer for the state for 22 years. In that span, the Legislature has missed its June 15 budget deadline 18 times. Still, there are signs that

this year the problem could be worse than in years past. On Wednesday, State Controller Steve Westly warned that California’s cash reserves are drawing down, and banks are refusing to lend

the government any more money until it straightens out its budget mess. He warned of pay cuts in the summer or fall if the state does not get a budget. Faced with threats such as that, state

workers stressed that legislators should not mistake their resignation for approval. “I hope that doesn’t make legislators think, ‘Oh, we don’t have to worry, we’ve got plenty of time, the

villagers don’t have their torches lit,’ ” Booker said. Even though employees may not be surprised by the state’s budget dance, they are growing weary of it. “It really stinks,” said Rudy

Valverde, 58, an associate insurance compliance officer, as he walked to the Pershing Square Metro Rail station for the subway ride home. “The blame is on both sides of the aisle -- and the

governor has shown no leadership.... We go through this every year. And they can’t get it right.” In Sacramento, last week opened with the Legislature missing its constitutional deadline to

pass a budget. It closed with legislators threatening to sue one another over a hike in the state car tax. Yet the deadlock continues without consequence for the lawmakers, who have fallen

into the habit of simply ignoring the state Constitution, which sets the deadline but specifies no penalty for legislators who violate it. So they do. State workers, meanwhile, are asked to

show up on time and do their jobs. Waiting for her bus home, Dorla Williams, 49, a supervisor for health services, had an idea for speeding along the budget process: “They need to fine the

legislators if they don’t do their jobs. If we don’t do our jobs, we don’t get paid.” In fact, in the event of a prolonged budget stalemate, the California state employees stand to be

penalized with pay cuts -- even if they are doing their jobs. That’s where having experience with the budget roller coaster comes in handy. “I’ve been a state employee for eight years, and

I’ve never experienced not getting a check,” said Ward. She came close, though: She got a layoff notice five years ago when she worked for the State Bar. Ward managed to land her current job

a week before the layoff took effect. “I just made it,” she said, now inured to recurring threats of financial disaster. Seasoned workers calm the neophytes worried about paychecks being

cut. “You hear from co-workers that, in so many years, that hasn’t happened, so just relax,” said Yolanda Castro, 34, a legal support staff member at the Department of Justice. “We try to

make the best of it.” Resigned to the uncertainty, some of the state’s 295,000 employees have taken comfort in reassurance from supervisors. Castro works in the criminal division, where

supervisors believe they will be relatively untouched because there is so much work to do. “They say, because of the high volume of criminals in the state, they need all the staff,” said

Castro. “That’s what they tell us -- maybe so we won’t stress.” This year, however, the shortfall is bigger, tempers in Sacramento are hotter and the background noise of politics is louder,

with a gubernatorial recall effort underway. For state workers, that makes it tougher to keep a positive outlook. It helps that Westly has tried to protect workers from a pay cut, even

though a court has told him to reduce the wages of state employees to the federal minimum if there is not a budget deal. For some workers, the only recourse is to hope it doesn’t come to

that. “I just feel like I’m going to worry about it if it happens,” said Hal Adelman, 59, a compliance officer with the state’s Department of Insurance. “I guess I’m an optimist.” “They

talked about it last year,” said Frances Conroy, 32, who works for the state’s Department of Justice at the Reagan building downtown. “That was always an issue -- whether we would make

minimum wage. It didn’t happen.” Despite the wait-and-see attitude, rumors waft around the Reagan building about layoff notices and pay cuts. One employee after another expressed doubts that

next month’s scheduled 5% pay increase would show up in paychecks. And in fact, managers will not get a 5% increase, according to Marty Morgenstern, the director of the Department of

Personnel Administration for the state. And all employees will find their July paychecks smaller. That’s because the normal 5% contributions from their salaries to their retirement plans,

which had not been deducted for the past two years, will kick in again, as long scheduled. “As far as rank and file go, we have 21 different bargaining units -- 17 have contracts up on July

2,” Morgenstern said. Most of those contracts call for 5% increases in pay for the coming fiscal year. But Morgenstern is in discussions with all of those unions, whether their contracts are

up or not, about deferring that raise. Morgenstern confirmed that about 150 state employees will get 30-day layoff notices as a result of current budget year changes. It all adds to the

uncertainty and anxiety that state workers are being asked to endure these days. Even those who are hopeful are guarded. Claudia Ward will have knee surgery next month. Valverde has vacation

plans for Hawaii in September. But financial analyst Helen Cui suggested that her husband wait to buy the new car he wants. And Dorla Williams has put the brakes on spending. “I haven’t

done anything,” she said. “I would be shopping and doing home improvement projects.” Valverde said he could get his money back on his vacation if he decided later against a trip. “It’s not

just the budget,” he said, noting that he also worries about taking a vacation around the second anniversary of the Sept. 11 attacks. “There are so many uncertainties in the world.” MORE TO

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