The agency's financing body -- made up of the treasurer, controller, finance director and Klein -- earlier this year authorized $200 million in rare bond anticipation notes.
They were authorized for sale to private philanthropists who will be repaid only if the litigation is resolved in the state's favor. Klein brokered the sale of $14 million in those bonds -- money that has already gone to training grants at California institutions.
Cody's group filed a lawsuit three weeks ago that seeks the return of that money and to block the issuance of more such bonds.
More than $30 million more will soon be issued to other philanthropists, Klein said, bringing the total to about $50 million. The state's $150 million loan, then, would bridge the remainder of the $200 million until the notes are sold.
Klein said Schwarzenegger's staff sought him out Wednesday and "asked what they could do" after it became clear that the president would go forward with his veto.
They worked quickly.
Klein described the unusual loan Thursday as a "mechanism that I designed yesterday with the governor's staff."
Critics who have called for more transparency and legislative oversight of the institute said Thursday that Schwarzenegger missed his chance to impose it.
"Along with public funding should come public oversight. Instead, the governor gave CIRM a blank check," said Jesse Reynolds of the Center for Genetics and Society.
Another watchdog group that has worked to ensure that the institute is accountable to taxpayers cautiously applauded the loan.
It's "better than going hat-in-hand to fat cats with a potential vested interest in the outcome, begging for money," said John Simpson of the Foundation for Taxpayer and Consumer Rights in Santa Monica, who criticized a recent private gala held by the institute to raise funds to keep it afloat.
Among stem cell scientists Thursday, the mood was good.
"This is wonderful news," said Dr. Arnold Kriegstein, who heads a stem cell research program at UC San Francisco and has already received training grants for 16 graduate, postgraduate and postdoctoral fellows.
"This amount of funding promises to make a significant impact on labs all over," he said.
Patient advocates were elated.
Susan DeLaurentis, who heads the Los Angeles-based Alliance for Stem Cell Research, said the Bush veto "was a dark day, and today, the sun has come out again.... To have Gov. Schwarzenegger restore hope to all these people, it's fantastic."
