All eyes are going to be on the state's chief financial officer to see whether he stops paying the salary and expenses of legislators.
Controller John Chiang says he will issue some sort of determination this week about the extent of his powers and obligations under the 2010 constitutional amendment that blocks legislative pay in the absence of a budget.
The key of course, is what the Legislature's duty is under Proposition 25 in order to get paid. Let's begin with the actual language of the initiative:
"...[I]n any year in which the budget bill is not passed by the Legislature by midnight on June 15, there shall be no appropriation from the current budget or future budget to pay any salary or reimbursement for travel or living expenses for Members of the Legislature during any regular or special session for the period from midnight on June 15 until the day that the budget bill is presented to the Governor. No salary or reimbursement for travel or living expenses forfeited pursuant to this subdivision shall be paid retroactively."
By that standard -- and the question may be whether this is the controlling standard -- it's hard to see how they don't get paid. After all, they sent the budget bill to Governor Jerry Brown (though they did not send the related "trailer" bills), which the passage above clearly says is the trigger.
But Chiang has already offered what reads like an argument to the contrary. On June 2, he announced that the standard was not just a budget but rather a "balanced budget." His position is based on 2004's Proposition 58, the compromise deal struck by Democrats and former Governor Arnold Schwarzenegger to add language to the California Constitution requiring a balanced spending plan, an amendment that sits in the same section of the state's blueprint as does Prop 25. Prop 58 was widely panned because it offered no clue on how to define "balanced." And every single budget passed and signed into law states that its inflow and outgo match up... even when they ultimately do not. As journalist and reform advocate Mark Paul wrote on Friday:
Under the constitution, a budget is balanced if the Legislature says it is balanced. That's a weak guarantee of fiscal balance, as budget wonks have noted ever since it was proposed and passed. But the constitution, a system of checks and balances, gives the governor the power to use his line item veto to bring spending in line with his projection of revenues. And legislators can seek to override those vetoes by a two-thirds vote if they disagree.
But there's still some murkiness thanks, in no small part, to the drafting of Proposition 25's 'Findings and Declarations,' where you'll find this sentence: "This measure requires incumbents to permanently forfeit their salaries and expenses for each day the budget is late."
How do we define "late?" The measure never says. In fact, the same section of Prop 25 interchangeably uses the terms "pass" and "enact," even when one word ("pass") is clearly something the Legislature can do when it comes to the budget, but the other ("enact") would ostensibly mean making it the law... and thus requiring the governor's signature.
Regardless, Controller Chiang is now clearly in the thick of it. For starters, there's doubt as to whether Chiang has any role to crunch budget numbers in search of "balance," and his press release from last week even says so. But should he weigh in, you've got to believe that this is headed to court. If he refuses to pay legislators, he will no doubt be sued by someone (a legislator, perhaps?) alleging that he's overstepped his authority. But if he writes those paychecks come June 30, he will indeed be sued by Jon Coupal of the Howard Jarvis Taxpayers Association, who sent Chiang a letter on Friday putting him on notice.Chiang has been at the center of several budget stalemate battles in his six-plus years as controller, most notably the showdown with Schwarzenegger over minimum wage for state workers in the absence of a budget by July 1 (new labor deals with state employees explicitly guarantee their pay should the budget be late this time around). Now, he's facing a fight with his fellow Democrats. Some of the Democratic legislators who were most ardent about the need for Prop 25 now seem the most concerned about using it to garnish their pay after voting for the now vetoed budget last Wednesday.
"Passing a budget is a legislative act," tweeted state Sen. Noreen Evans (D-Santa Rosa). "Prop 25 doesn't make Controller the 121st legislator in the budget process."
Republicans might be as unhappy as Dems about losing their pay but could now believe there's a political advantage to be gained by tapping the 'stick it to the politicians' anger of voters. "I don't think we deserve to get paid," Assemblymember David Valadao (R-Hanford) told his local TV station. In truth, the no-pay action would save only about $50,000 a day, a very small amount of what the state spends. But symbolism has enormous value in politics. Just ask the interest groups, mostly aligned with Democrats, who put Prop 25 on the November ballot and ran a political campaign centered around the paycheck punishment.
Governor Brown also may have muddied the waters on the issue with his veto message. "Unfortunately, the budget I have received is not a balanced solution," wrote Brown. That's even though the budget documents asserted the plan's fiscal balance.
In the end, perhaps this is an area to which government reformers should turn their attention: who should certify what's real and what's make believe when it comes to the state budget? State Sen. Sam Blakeslee (R-San Luis Obispo) has already has announced his intention to draft a constitutional amendment explicitly giving the controller some of the powers now in dispute. And then we could always look to other states like... well... Texas, where the state's comptroller (roughly the same job) is given the power to provide the official estimate of revenues with which the state's legislators craft a spending plan.
Meantime, stay tuned on this one; it's going to get interesting.
Note: On my new California politics Facebook page, I've put up a very non-scientific poll question, asking if the Guv did the right thing in vetoing the budget last week. So far, the "Good for Jerry" side is winning handily... 94% say he did the right thing. Weigh in if you'd like!