Wilson Wins, Moves Quickly to Build New Administration : Governor: He says he will plunge into work on reform of the budget. But hostile Democrats sweep most state offices and strengthen control of the Legislature.

Republican Sen. Pete Wilson narrowly won the job he’s always wanted--governor of California--and moved quickly Wednesday to assemble a new state Administration that faces formidable budget obstacles and hostile Democrats in virtually every other key office in Sacramento.

After accepting the concession of Democrat Dianne Feinstein, Wilson appointed an eight-member transition team led by trusted friends and associates who will help him open shop in Sacramento Friday. He brushed off speculation about whom he might pick for the U.S. Senate seat he will be leaving after eight years. And Wilson indicated he will plunge into work on reforms of the state budget as early as next week, after a brief Washington trip to begin wrapping up his Senate career.

“I look forward to getting to work,” the 57-year-old former state assemblyman and mayor of San Diego said at a news conference in San Diego. “There is much to be done.”

Wilson got less than 50% of the vote in what may turn out to be a record-low turnout for this century, estimated to rise to 59% when the absentees are counted. And he will not have much Republican support within the Sacramento political structure. Democrats swept almost every other state office and consolidated their control in both houses of the state Legislature.

The only other opportunity for the GOP rested with Daniel Lungren, who trailed Democrat Arlo Smith in the contest for attorney general, but hoped to win on the basis of uncounted absentee ballots.

When he takes the oath of office Jan. 6 as California’s 36th governor, Wilson will have moved from one of the nation’s most coveted political jobs to another, succeeding two-term Republican George Deukmejian.

Wilson will have the power to appoint his Senate successor, who would serve until the next general election in 1992. That is the time when California’s senior senator, Democrat Alan Cranston, already faces reelection--an extraordinary situation in which both of California’s Senate seats would be at stake.

There has been speculation that Wilson had already decided to name U.S. Trade Ambassador Carla Hills to his Senate post. But the governor-elect insisted he has not had time to think about his role as a political kingmaker. “So (now) I will think about it. But that will be the subject of another news conference on another day,” he said.

Feinstein supporters, buoyed by her come-from-behind showing, already were looking forward to a Feinstein Senate try in 1992. The former San Francisco mayor acknowledged there is a chance she may run. “I’m not considering anything today. But clearly it’s an option,” she said during a San Francisco press conference.

Wilson carried California by 186,000 votes out of 7.2 million cast at the polls Tuesday. Feinstein conceded in a telephone call at 10:10 a.m. Wednesday, more than 14 hours after the polls closed, saying she “wished him well . . . offered to do whatever I could do to help.”

Feinstein went to bed early Wednesday clinging to hopes of pulling out a surprise victory. But a 180,000-vote margin for Wilson in Orange County, far larger than he got in his home county of San Diego, put the contest beyond her grasp. The counting of an estimated 400,000 to 500,000 absentee ballots during the coming week is expected to swell Wilson’s total.

Feinstein actually may have won a majority of votes cast at the polls by walk-in voters Tuesday, with Wilson’s victory margin coming on absentee ballots, according to The Los Angeles Times Poll and an analysis of election returns. Of the 7.2 million votes counted, as many as 1 million were absentee ballots that came in early enough to be tallied Tuesday. With Republicans mounting a major vote-by-mail campaign, a majority of those ballots were expected to go to Wilson.

Feinstein said hers was “an extraordinary candidacy,” the first such by a woman in California and her first statewide campaign after winning local elections in San Francisco over a 20-year period. “We came close, but it wasn’t enough,” she said.

In San Diego, Wilson said Feinstein “ran a very spirited campaign and I salute her for it . . . She wanted to make history and I think she has.” He described their conversation as “very warm” and “I suggested that after she has had a little r-and-r that she get back in touch. It is a friendship that I look forward to resuming.”

The Wilson-Republican victory was thin and without any apparent coattail effect. All incumbent Democrats in statewide offices won reelection. Kathleen Brown took the state treasurer’s office away from the GOP. And Democratic state Sen. John Garamendi became the state’s first elected insurance commissioner, a position created by voters’ approval of Proposition 103 in 1988.

In the contest for attorney general, Democrat Smith, the San Francisco district attorney, held a 28,000-vote lead over Republican Lungren, the former congressman from Long Beach, in semiofficial returns that were complete except for the uncounted mail ballots. Wilson said he was confident Lungren would emerge the eventual winner, but it could be a week or more before the contest is settled. They competed for the post Democrat John K. Van de Kamp vacated to run unsuccessfully for governor.

In all, Democrats lost one U.S. House seat, but still control the state’s delegation to Congress by 26-19. And Democrats solidified their power by picking up three seats in the Legislature, where Wilson’s programs are likely to face a hard sell.

Lawmakers are particularly angry at Wilson for his aggressive support for Proposition 140, the ballot initiative that limits Assembly and Senate terms to six and eight years respectively. It also eliminates the lawmakers’ lucrative pension system and halves the legislative staff. Wilson embraced Proposition 140 during his Oct. 7 debate with Feinstein, at a time when it appeared he needed a new issue to help him break out of a race with Feinstein that was deadlocked in the opinion polls.

Wilson and the Democratic leadership in the Legislature--primarily Assembly Speaker Willie L. Brown Jr. (D-San Francisco) and Senate President Pro Tem David A. Roberti (D-Los Angeles)--also are expected to clash in the coming year over the redrawing of legislative and congressional districts to reflect California’s growth during the 1980s. Brown was a special target of Wilson’s campaign invective during the campaign. Wilson repeatedly claimed that Feinstein was “beholden” to her San Francisco political ally for political favors he had performed--primarily by helping her get the endorsements of labor and public employee groups.

Asked about peace-making prospects with Brown and Roberti, Wilson said, “I expect to see the leaders of the Legislature early and often.”

California is expected to pick up seven new House seats through redistricting. The national Republican Party emphasized the importance of winning the California governorship so that Wilson could carry out his promise--or threat--to veto any reapportionment plan that was not “fair” to Republicans.

First, Wilson will have to deal with a deficit of up to $2 billion in his inaugural budget, which must be submitted to the Legislature by Jan. 10. The expected deficit results from a combination of declining revenues and rising costs of government. Automatic cost-of-living increases and spending mandates adopted over the years by voters through a variety of initiatives often are blamed for breaking the state budget.

Wilson said budget reform would be his first priority, adding:

“I think what is very clear is there has to be a very great deal of time and effort given not just to this budget, but really reforming the process. I think you will find that I will immerse myself in that whole process between now and the time that the first budget has to be submitted.”

Until such reforms can be achieved, any talk of new taxes is premature, Wilson said. He noted that the results from Tuesday’s election that saw the defeat of a number of revenue and spending ballot measures indicates to him “the tax revolt is not dead.”

Wilson appointed 48-year-old Robert S. White of San Diego to head his team that will coordinate the transition from the Deukmejian Administration to his own. He will be the gubernatorial chief of staff after Wilson is sworn in. White has been Wilson’s top assistant since the governor-elect was first elected to the state Assembly from San Diego in 1966 and has been in command of Wilson’s U.S. Senate staff.

Otto Bos, a Wilson aide for 14 years, will be the transition’s No. 2 person as deputy director for communications and public affairs. As a sign that there may be room in the Wilson Administration for some Deukmejian holdovers, Wilson named the former governor’s appointments secretary, Terrance W. Flanigan, to handle that critical role for the transition. Wilson boldly invited viewers watching his televised press conference to send their resumes to the transition office in Sacramento if they were interested in state positions.

Both Wilson and Feinstein offered each other outstretched hands in their concession and victory statements. Despite their party differences, they used to be relatively close political and personal friends. That friendship seemed to have been shattered by the often-bitter personal attacks on one another during the heat of the campaign.

But Feinstein told reporters Wednesday that she and Wilson had “a very pleasant conversation and I wished him well.”

Wilson often has said he was honored to serve California as a U.S. senator, but his political goal always has been to be governor of California, a position which he said has the potential for a larger impact. He made it on his second try, and in his fourth statewide race. Wilson ran in the GOP primary in 1978, but finished a dismal fourth in a field of five. He toyed with trying again in 1982, but opted for the Senate seat instead.

Times staff writers Virginia Ellis, Jerry Gillam and Daniel Weintraub also contributed to this story.