California Democratic Party spokesman Roger Salazar said in a statement that Schwarzenegger "sat silent as his supporters took Proposition 71 to court."
Plaintiffs also objected to the maneuver, saying they would consider seeking a restraining order to prevent it.
"It's inappropriate," said Dana Cody, executive director of Life Legal Defense Foundation, which represents two taxpayer groups that challenged Proposition 71. "It is a risk to the taxpayers. We may or may not prevail, but it's still a risk."
Institute officials, however, celebrated the news.
Robert Klein, the main proponent of the stem cell ballot measure and chairman of the institute's citizen oversight body, called it "a tremendous day" and said the funding would allow the institute "to move immediately into a major program of research in California for the benefit of patients worldwide."
Institute President Zach Hall said that once grant proposals are received, dollars could flow to research by early next year.
Ironically, Hall noted, Bush's first-ever veto -- based on his opposition to the destruction of embryos in some forms of embryonic stem cell research -- served California well. "I think with one stroke, the president energized [the institute's] program," he said.
The promised funding instantly guaranteed that California will leapfrog other states in public funding of the research, which many believe holds potential cures for spinal cord injuries and a range of diseases, including Parkinson's and diabetes.
Connecticut, Maryland, Illinois and New Jersey have approved some state funding for the work. And on Thursday, the governor of Illinois announced that he was diverting $5 million from the state budget for stem cell research -- also in response to the Bush veto.
Schwarzenegger's $150 million loan dwarfs those efforts.
It is also about quadruple the budget for embryonic stem cell research at the federal government's National Institutes of Health, which is strictly limited by the Bush administration to select stem cell lines created before 2001.
The loan, however, is just half of the estimated $300 million that the initiative, if upheld by the courts, will direct to stem cell research every year for a decade.
The loan was brokered under an obscure section of Proposition 71 that allows the state finance director to provide bridge financing for bonds that are authorized but not yet issued.
