Controller John Chiang Halts California Legislators' Pay

Click here for our Sacto Bureau Chief John Myers’ live Twitter coverage of Chiang’s decision and the response from legislators.

Fun times for the California legislature. Constant fighting, dismal approval ratings, a vetoing governor, and lousy pay. And by lousy I mean non-existent.

Because Controller John Chiang has decided to withhold the salaries of state lawmakers based on his reading of two California initiatives that mandate the legislature send a balanced budget to the governor by the constitutional deadline of June 15 — or else have their pay cut for each day they fail to do so. Here’s Chiang’s statement, which outlines his reasoning and is headlined: “Chiang Finds Budget Did Not Balance On Paper.”

Legislators — Democratic ones, anyway — think they met their obligation with the submission of the budget that Brown vetoed last week. But although Proposition 25, passed last year, states only that they have to hand in an on-time budget in order to keep their paychecks coming, a previous initiative, Proposition 58, specifies that budget must be balanced. And the question of whether the nixed budget actually did that without resorting to accounting maneuvers and unfounded assumptions was raised by Brown himself when he cited the “gimmickry” employed in order to make the deficit go away. Chiang addressed that in his statement today:

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 (Note: See analysis of the discrepancy here), 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.

KQED’s John Myers broke down the issues for us in an interview yesterday, and he mentioned one aspect of the debate that Chiang touched on in his comment about not substituting his own policy judgment for the legislature’s and governor’s.

“There’s a separation of powers issue,” Myers said, asking whether controllers should be given the power to unilaterally decide what is a balanced budget and what isn’t, in light of their newly created ability to make legislators suffer financial hardship?

Good question. Another point made by Myers: This is more than likely going to wind up in court.

Live twitter coverage by Myers below:

Here’s more analysis on the issue by Myers, written two days ago.

Update 1 p.m. Lot of committee hearings being webcast at 1:30 p.m. on The California Channel. Who knows what statements will come out of various mouths now that lawmakers are working for free. And if anyone says they’re being unprofessional, they can shoot back, “That’s because we’re now officially amateurs.”