SACRAMENTO, Calif. (AP) — The state employee furloughs started under Gov. Arnold Schwarzenegger greatly increased the cash-out liabilities owed by California taxpayers when those workers leave government service.

A report released Thursday by the nonpartisan Legislative Analyst's Office says payments to employees for accrued leave time are at historic levels, reaching nearly $270 million in the last fiscal year.

The furloughs were intended to help close budget deficits and saved the state about $5 billion over five years. But nearly $1 billion now must be paid to employees in accrued leave time when they quit or retire.

The report says many workers simply substituted furloughs for their normal vacation days, increasing the state's liabilities.

California's long-term liability to pay employee leave balances is now $3.9 billion annually, or 27 percent of all salary costs.