State Controller John Chiang announced this morning that he plans to withold the paychecks of state legislators, starting June 16, if the lawmakers haven't submitted a balanced budget to the governor. The real tough love? "Payments forfeited will not be paid retroactively."Chiang says he's just complying with the terms of Proposition 25, the "On-Time Budget Act of 2010," approved by voters last November. The initiative didn't say lawmakers must submit a "balanced" budget, just "a budget bill" by the longstanding June 15 deadline -- or forgo their paychecks. In recent weeks, some have suggested that passing Gov. Jerry Brown's budget proposal in March was enough to satisfy the terms of Prop. 25, even though that proposal still leaves us with a deficit of about $10 billion.
But Chiang counters that Prop. 25 must be read in tandem with 2004's "California Balanced Budget Act," Proposition 58, which specifically requires a budget bill that balances revenue and expenditures. As L.A. Times columnist George Skelton noted recently, "It has been 25 years since the Legislature wrapped up its budget work by June 15."
Though the controller's stance is surely making some legislators ansy in private, Assembly Speaker John Perez publicly supported the move:
I support the Controller’s decision to withhold paychecks from the Legislature if we do not send a comprehensive, balanced budget to the Governor by our Constitutional deadline. I was a vocal supporter of Prop 25, and I do not believe we should even be talking about loopholes or ways to get around that provision because our focus needs to be on doing our job and passing a balanced budget.
Here's the full text of Chiang's statement, released Thursday morning:
In response to recent questions regarding the impact of Proposition 25, Controller John Chiang today announced he will permanently withhold Legislators’ salary and per diem beginning on June 16 if they fail to approve a balanced budget in the next two weeks.
"Presenting the Governor with a balanced budget by the Constitutional deadline is the most important, if not most difficult, job of the California Legislature," Chiang said. "In passing Proposition 25 last November, voters clearly stated they expect their representatives to make the difficult decisions needed to resolve any budget shortfalls by the mandatory deadline, or be penalized. I will enforce the voters' demand."
Proposition 25, titled the "On-Time Budget Act of 2010," was approved by voters November 2, 2010. The initiative lowered the vote requirement for passing a budget from two-thirds to a simple majority. It also required members of the Legislature to forfeit their salary and reimbursement for travel and living expenses incurred from June 16 until "the day that the budget bill is presented to the Governor." Payments forfeited will not be paid retroactively.
Recently, questions have been raised regarding whether the budget passed by the Legislature had to be balanced, or if the budget bills passed in March would suffice. The Controller's analysis of these issues concludes Proposition 25 cannot be read in a vacuum, and must take into account the provisions of Proposition 58 (passed by voters on March 2, 2004), the intent language found in Proposition 25, and the voter information and campaign materials upon which the voters relied.
Proposition 58 states, "[T]he Legislature may not send to the Governor for consideration, nor may the Governor sign into law, a budget bill that would appropriate from the General Fund, for that fiscal year, a total amount that ...exceeds General Fund revenues for that fiscal year estimated as of the date of the budget bill’s passage." Because Propositions 58 and 25 overlap in the same section of the Constitution and address the same topic, they must be read together.
And here is the controller's legal analysis, underpinning Chiang's announcement.
Tyche Hendricks is the editor of The California Report's Governing California blog.