Lawmakers incentive : No Budget, No Paychecks

Posted on June 17, 2011

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Governor Jerry Brown gave both Democratic and Republican lawmakers a whole lot to think about today with a budget veto yesterday.

Last years Proposition 25 reduced the supermajority requirement to pass a budget to a simple majority theoretically making passing budgets in Sacramento easier. The carrot? A simple majority. The stick? No paychecks, no per-diem and a permanent loss of all pay and benefits every day past June 15th that a budget isn’t passed.

Governor Brown didn’t just veto a budget. He in effect told lawmakers they weren’t getting paid until they passed a balanced budget with his veto.

While last years’ proposition 25 made passing budgets easier, last years’ proposition 26 made passing a budget that included any increase in monies labeled other than taxes a little more difficult, requiring a supermajority. Since prop 13 passed, our state has come up with renaming taxes as fees and assessments etc to get around proposition 13 and avoid raising taxes. New fees, etc now require a supermajority, just like new taxes.

Given that California’s judiciary is largely a Republican animal with most on the bench identifying as being Republicans, the thought was that this devastating court budget cut is, in part, a ploy for the Judicial Branch’s Republican majority to encourage Republican legislators back to the table for tax extensions.

Yesterday’s budget is not indicative of the cuts coming down the pipeline without those tax extensions. Because most of yesterdays budget amounted to 12 billion dollars of wishful thinking and kicking the can down the road, to balance the budget without the tax extensions would result in far more draconian cuts in the judicial branch budget than those rejected yesterday. This gives Judicial Branch leadership a lot to chew on. Will they reach out to Republican legislators and espouse the importance of temporary tax extensions or will they try to make their case with Democratic legislators in Sacramento about not making any further cuts?

About last year, this time, Arnold struck a deal with Ronald that gave the Judicial Branch an extra hundred million. The favor in return? Ronnie would hear the furlough cases on an expedited schedule.

In all of this Governor Jerry Brown sits in the proverbial catbird’s seat. He’s none too worried about getting recalled or re-elected in 3 1/2 years. With his long and distinguished service career to the People of the State of California, he really has nothing to lose by holding everyone’s feet to the fire for a no-gimmicks balanced budget that relies as much on increased fees and taxes as it does budget cuts.

Another Arnold, upset about rising vehicle registration fees that is willing to kick the budgetary can down the road to his grandchildren is not waiting in the wings to mount a recall effort. Even if they were, a smart electorate already witnessed eight years of gimmicks and one time fixes and they’re not ready for more.

The opportunity for leadership returns again to the office of the Chief Justice. Will she go to the Democrats with hat-in-hand asking them to fully fund the judicial branch? Will she tout the importance of kicking the budgetary can down the road to her grandchildren or will she reach out to Republican lawmakers and tout the importance of balancing this states budget with a combination of tax extensions and budget cuts? Does she wish to be perceived as part of the solution or part of the problem?

A whole lot of judicial branch budget both now and in the future relies on what side she approaches. Unfortunately, doing the right thing hasn’t yet crossed her radar screen.

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SACRAMENTO– State Controller John Chiang today made the following comments regarding the Governor’s decision to veto the budget bills enacted Wednesday by the Legislature:GOVERNOR’S VETO”With one arm tied behind their backs, Democratic lawmakers attempted to close the budget deficit while not betraying their core values of protecting public safety and education. It fell short because Californians aspire for a balanced budget built on sustainable solutions that will restore the state’s fiscal health for the long-term. Anything short of that only invites more of the turmoil, uncertainty, and lost opportunities that have been the hallmarks of budget plans in years past.”I support the Governor’s decision today to call upon legislators – from both parties – to try again.”

PROPOSITION 25

“I remain resolute in my commitment to enforcing the public’s will to permanently withhold legislative pay for every day a balanced budget is not passed after yesterday’s deadline. Article 4, Section 12(g) of the Constitution clearly states that a budget is balanced only if authorized expenditures do not exceed projected revenues, ‘as set forth in the budget bill passed by the Legislature.’

“I will move quickly to complete our analysis of whether the budget bills passed Wednesday meet the constitutional definition, or fall short, which would require my office to forfeit their pay under Proposition 25. We are awaiting the final budget bill language before we begin our examination. In addition, we have asked the Department of Finance, which tracks and tallies the Legislature’s budget activities, for data to inform our decision.”

ADDITIONAL BACKGROUND INFORMATION:

• Proposition 25 only references the Legislature’s passage of a budget; it is not affected by the Governor’s signature or veto.

• Nothing in the Constitution or state law gives the State Controller the authority to judge the honesty, legitimacy or viability of a budget. The only authority this office has over the budget is through Proposition 25 and 58, to determine whether the budget bills enacted show that expected revenues will equal or exceed planned expenditures. As evidence of that, Senator Sam Blakeslee has announced plans to introduce a constitutional amendment giving the Controller broader, independent authority to evaluate budget solutions for “smoke and mirrors.”

Produced by JCW in association with Yen Interactive Media

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New from Courthouse News: San Francisco to close 1/2 of it’s courtrooms and lay off 40% of its workforce (This assumes trial courts and not the AOC being expected to bare the brunt of cuts. )

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YenWire reports the following:

 

Chiang Finds Budget Did Not Balance On Paper

 

SACRAMENTO – State Controller John Chiang today announced that his analysis of the State budget vetoed last week shows the spending plan was incomplete and unbalanced. His analysis sought to determine whether the budget met the requirements of Proposition 25 and Proposition 58, which forfeit Legislative pay if a balanced budget is not passed by June 15.

“My office’s careful review of the recently-passed budget found components that were miscalculated, miscounted or unfinished,” said Chiang. “The numbers simply did not add up, and the Legislature will forfeit their pay until a balanced budget is sent to the Governor.”

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 without lowering the two-thirds vote required for tax increases. It also forfeits Legislators’ pay and living expenses incurred from June 16 until “the day that the budget bill is presented to the Governor.”

Nothing in the Constitution or state law gives the State Controller the authority to judge the honesty, legitimacy or viability of a budget. The Controller can only determine whether the expected revenues will equal or exceed planned expenditures in the budget, as required by Article 4, Section 12(g) of the Constitution: “. . .the 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. That estimate of General Fund revenues shall be set forth in the budget bill passed by the Legislature.”

“While the vetoed budget contains solutions of questionable achievability and some to which I am personally opposed, current law provides no authority for my office to second-guess them in my enforcement of Proposition 25,”said Chiang. “My job is not to substitute my policy judgment for that of the Legislature and the Governor, rather it is to be the honest-broker of the numbers.”

Using this standard, the Controller’s analysis found that the recently-vetoed budget committed the State to $89.75 billion in spending, but only provided $87.9 billion in revenues, leaving an imbalance of $1.85 billion.

The largest problem involved the guaranteed level of education funding under Proposition 98. The June 15 budget underfunded education by more than $1.3 billion. Underfunding is not possible without suspending Proposition 98, which would require a supermajority (2/3) vote of the Legislature.

The budget also counted on $320 million in hospital fees, $103 million in taxes on managed-care plans, and $300 million in vehicle registration charges. However, the Legislature never passed the bills necessary to collect or spend those funds as part of the State budget.