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SACRAMENTO (AP) _ Saying he supports the concept of raising the wages for California's lowest paid workers, Gov. Arnold Schwarzenegger nonetheless vetoed a bill Thursday that would increase the minimum wage by $1 an hour to $7.75 over the next two years.

The bill, from Assemblywoman Sally Lieber, D-Santa Clara, would have also required the minimum pay be adjusted each year to keep up with inflation _ a mandate that would begin in 2008. Schwarzenegger said in his veto message that it was the automatic adjustment that caused him to reject the proposal.

"The minimum wage has not been increased since 2002, and I believe it is now appropriate," the governor said in his message. "This is a position I made very clear to the author. However, I have also made it clear that I do not support automatic increases to the wage that relieve elected officials of their duty to consider all of the impacts each increase to the wage will have on workers and businesses."

Democrats and labor groups complained that Schwarzenegger's veto was at the behest of his many corporate campaign contributors who had lobbied strongly against the bill.

"Wealthy companies set new records in political contributions to buy this veto,'' said Art Pulaski, executive secretary-treasurer of the California Labor Federation. "Schwarzenegger bends whichever the way the corporate winds blow. Just a few weeks ago, the Restaurant Association, a major opponent of the bill, hosted a fund-raiser for Schwarzenegger in Los Angeles. Coincidence? I don't think so."

Schwarzenegger also vetoed:

•  A bill that would have imposed stiff financial penalties on employers who are found to be paying equally qualified employees at different rates.
•  A bill that would have banned the use of the nickname Redskins for school teams and mascots. The governor said decisions about team names should be made by local officials.
•  A bill that would have forced employers and insurers who take injured employees to court before paying out workers' compensation benefits to pay a penalty. Schwarzenegger said current law already penalizes companies that unreasonably delay or refuse to pay benefits.

He signed:

•  A bill that clarifies that marital status and sexual orientation are among the characteristics protected against discrimination by business establishments.
•  A bill that requires the Department of Education to post on its Web site an athletes' bill of rights explaining that federal law bars sexual discrimination in school programs, including sports.
•  A bill that encourages the use of biodiesel by allowing public agencies to use the alternative fuels.
•  A bill that requires home buyers to be specifically notified before an agreement is signed about all property taxes pending.
•  A bill that returns millions of dollars in sales taxes from jet fuel to communities that host airports.