DATE=10/9/03

TYPE=CORRESPONDENT REPORT

TITLE=SCHWARZENEGGER TEAM (L-O)

NUMBER=2-308438

BYLINE=MIKE O'SULLIVAN

DATELINE=LOS ANGELES

VOICE AT:

INTRO: California governor-elect Arnold Schwarzenegger has announced members of his transition team, including a Florida official who will oversee an audit of California finances. Mike O'Sullivan reports, Mr. Schwarzenegger says Democrats and Republicans will help shape his administration.

TEXT: Just two days after winning a historic recall election, Mr. Schwarzenegger announced the team that will help him build an administration for the time he assumes the governorship, probably next month. He says he is getting help from many quarters.

/// SCHWARZENEGGER ACT ///

You will see a very diversified team of people on the list. You will see people that are to the left, people that are to the right, and people that are to the center.

/// END ACT ///

The nearly 70 advisors include the Democratic mayors of Los Angeles and San Francisco, Jim Hahn and Willie Brown, and former U-S Secretary of State George Shultz, a Republican.

The Republican governor-in-waiting says the most important task that faces the new team is sorting out California's troubled finances.

/// SCHWARZENEGGER ACT ///

We need to do it the right way, the legal way, the way it always has been done in California, rather than brushing the debt under the rug and pretend like we don't have that debt, and we don't have that deficit and all those kinds of things. We want to expose everything, let the people see what's going on.

/// END ACT ///

Mr. Schwarzenegger says California's debt next year, already projected at eight billion dollars, may actually be higher than 10 billion. And he announced the appointment of Florida's budget director, Donna Arduin (AR-den), as finance director of his transition team. The Florida official was given a leave of absence by her boss, Governor Jeb Bush, the president's brother. Ms. Arduin said she would start her assessment in California immediately.

/// ARDUIN ACT ///

We're going to get to work this afternoon, so as soon as we get to work, we'll be able to get done with the audit.

/// END ACT ///

She says the audit will be finished by the January deadline for next year's preliminary budget.

In Sacramento, outgoing Governor Gray Davis, a Democrat, urged his cabinet members to help with the transition to the new administration. (Signed)

Neb/PT