`With one stroke’

            SAN FRANCISCO - California 's stem cell program won a $150 million loan from the state to allow it to begin funding research stunted by President Bush, handing a lifeline to the initiative while the courts resolve lawsuits that question its legitimacy. The loan authorized by Gov. Arnold Schwarzenegger gives a lift to the agency running the program, known as California Institute for Regenerative Medicine, which has been paralyzed largely by lawsuits since its approval by voters in November 2004. Although the institute aims to spend $3 billion on stem cell research in the state in the next decade, legal challenges backed by fiscal conservatives and opponents of the scientific work have prevented California from issuing bonds to fund its grants and operations. The governor's move came a day after President Bush vetoed legislation that would have loosened significantly federal restrictions on funding embryonic stem cell research. Stem cells, which have the capability to transform themselves into any sort of body tissue, are derived from four- to five-day-old embryos, which are destroyed in the process. "I have to give credit to the governor for his leadership and decisive action at a critical point in the history of medical research," said Robert Klein II, chairman of the agency's oversight board. Klein said he began talks with Schwarzenegger's staff about the loan after it became clear Bush would veto the measure. "With one stroke, the President has energized the CIRM program," said Zach Hall, the agency's president. Dr. Hall said the loan will make it possible to move ahead with a program of seed money grants to scientists, which are expected to range from $100,000 to $500,000. That money, however, likely won't begin to flow until next year, Dr. Hall said. The new loan, which the institute will repay with proceeds from bond sales once they take place, brings the agency close to its goal of $200 million in funding this year. In April, several private donors supported the effort by purchasing $14 million in "bond-anticipation notes," which will be repaid with interest out of bond sales. Klein said the agency is in the process of closing another $30 million round of bond-anticipation notes. In the next few years, the agency intends to ramp up its budget to about $300 million a year.