The first batch of IOUs to be issued by cash-strapped California has been printed and will be sent to people awaiting income tax rebates today unless Arnold Schwarzenegger, the governor, manages to strike a last-minute budget deal with the state government.

With the state teetering on the brink of fiscal collapse, the controller's office is scrambling to issue about 30,000 IOUs, which California is offering instead of tax rebates because it has run out of money.