California ? Lawmakers on Friday approved a complex package of spending cuts, accounting maneuvers and raids on local government coffers to fill California’s gigantic budget deficit, providing hope that the state might begin a slow climb out of a deep financial hole.

The action came after a grueling month for the Legislature as the state dealt with a historic financial crisis that has grown more dire by the day, driven by a dramatic drop in income tax revenue amid the recession.

The cash crisis has become so acute that California has been forced to send IOUs instead of payments to thousands of state contractors and was facing the prospect of being unable to fund pension contributions or pay employees by September.

The cuts imposed by the Legislature are extraordinary. The deal will mean teachers are laid off, college students will pay more, parks will be closed, and office buildings will be sold off. Lawmakers agreed the scope of the cuts was distasteful, but most said they had little choice.