LOG NEWS SERVICE — Gov. Arnold Schwarzenegger has signed legislation transferring $29 million from the Harbors and Watercraft Revolving Fund to the state’s General Fund.

Photo by: AP Photo/Rich Pedroncelli A Stroke of the Pen -- With the new California budget, Gov. Arnold Schwarzenegger also signed a measure to borrow $29 million from boating project funds.

The measure, SBX3 2, is one of a package of bills designed to close California’s $42 billion budget shortfall Schwarzenegger signed Feb. 20. It transfers the money as a loan and stipulates that repayment shall be made “so as to ensure that the programs supported by the Harbors and Watercraft Revolving Fund are not adversely affected by the loan, but no later than June 30, 2013.

The Department of Boating and Waterways uses money from the fund — which derives the lion’s share of its income from the state fuel tax and vessel registration fees paid by boaters — to provide loans and grants for the construction and maintenance of recreational boating facilities throughout the state.

The $29 million loan is scheduled to be transferred from the fund during the current fiscal year ending June 30 — leaving the fund with an estimated balance of only $9.54 million at the beginning of the 2009-10 fiscal year July 1.

Although it does not appear to affect funding for current projects or those included in the governor’s proposed $75.13 million budget for the department beginning July 1, the $29 million loss is expected to be felt in subsequent years.

In a report submitted to the Boating and Waterways Commission Feb. 27, the Department of Boating and Waterways said that assuming the same level of revenues and expenditures over the next several years, the fund will have a deficit beginning in fiscal year 2010-11 through at least 2013-14. Options to be considered, it said, include increases in transfers and revenues and decreases in transfers and expenditures from the fund.