Arnold Schwarzenegger, the governor of California, has signed bills to introduce Harvey Milk Day in the state and to recognise gay marriages performed in other states.

The governor had 700 bills to sign or veto by midnight on Sunday. Gay rights activists feared he would veto all in a row over water supplies for the state.

Harvey Milk Day will be a special commemorative day to encourage schools to recognise the activist’s work. Nearly 40,000 California residents signed the petition for the commemorative day. It will not be an official holiday, but will encourage schools to remember Milk’s actions.

The other bill allows the state to recognise marriages performed in places where gay marriage is legal.

In a signing message, Schwarzenegger said the move will “provide the same legal protections that would otherwise be available to couples that enter into civil unions or domestic partnerships out-of-state.

“In short, this measure honours the will of the people in enacting Proposition 8 while providing important protections to those unions legally entered into in other states.”

The bill is an “everything but marriage” measure – meaning that gay couples who married in other states will have all the rights and benefits given to straight married couples but will not have the “designation” of marriage.

Gay marriage was legal in California until the state’s voters decided against it in November 2008. Gay rights activists are gearing up to get the issue on the November 2010 ballot.