SACRAMENTO, Calif. (Legal Newsline)-In a flurry of last-minute decisions, California Gov. Arnold Schwarzenegger made final decisions on legislation just hours before the deadline, including legislation to discourage urban sprawl, while at the same time vetoing a port smog-fighting bill.

While on the surface rejecting one bill intended to curb greenhouse gas emissions and improve the environment while signing another one appears inconsistent, the governor said the ports bill with its related cargo fees would hurt the state's troubled economy.

Because Schwarzenegger refused to sign any legislation before the state's fiscal budget was approved - a nasty debate that dragged on for a historic 85 days past the start of the budget cycle - the governor had to deal with more than 1,000 bills before midnight Tuesday. In all he signed 771 bills and vetoed 415.

The anti-sprawl legislation requires the California Air Resources Board to provide regional targets for reducing greenhouse gas emissions by September 2010, so that the state can meet a 2006 law to reduce emissions by 25 percent by 2020.

The legislation will give incentives to housing projects that meet goals for reducing emissions, particularly high-density projects near public transportation.

"What this will mean is more environmentally-friendly communities," Schwarzenegger said in a statement, "more sustainable developments, less time people will spend in their cars, more alternative transportation options and neighborhoods we can safely and proudly pass on to future generations."

The bill is based on a "smart growth" plan used by the Sacramento Area Council of Governments, according to published reports.

"Californians will see more infill," said Council of Governments Director Mike McKeever. "They'll see higher density housing, particularly in transit corridors. The new areas will look more like existing neighborhoods with a mix of uses between schools, stores and housing."

The backers of the bill negotiated the support of environmental groups, local governments and some builders' associations. Many business groups, including the California Chamber of Commerce, opposed the legislation.

The port smog bill, which was a top priority for many environmental groups, would have charged a fee on cargo containers. The money would then be used to fund programs that would reduce air pollution and traffic congestion.

"Given the current economic downturn," Schwarzenegger said of the bill, "it is vitally important that the state does not worsen the situation by mandating added costs on business that do not provide any public benefit."

Many of the state's biggest businesses opposed the bill, including the California Chamber of Commerce, and the California Grocers Association.