SACRAMENTO, Calif. (July 7, 2009)--State vendors and contractors could use their government-issued IOUs to pay state taxes, fees and liens under a bill approved by an Assembly committee.

The Business and Professions Committee unanimously passed the bill by Assemblyman Joel Anderson during its first legislative hearing Tuesday.

The bill requires the state to accept its own IOUs as payment for money owed to the government.

Anderson, a Republican from La Mesa, says the measure would help businesses and others being paid with IOUs.

The state began issuing the warrants last week as lawmakers struggle to close a $26.3 billion deficit.

The Assembly speakers' office has not decided if the bill needs a second committee hearing before the full Assembly can consider it.