The Legislature returns to Sacramento on Monday from a week-long spring recess, soon to head into the homestretch of budget negotiations. And it's possible that those negotiations will hinge on a fascinating -- and somewhat nasty - court fight between legislative leaders and the state's chief financial officer over the meaning of a 'balanced budget.'
On Tuesday afternoon, a Sacramento superior court judge is scheduled to hear the case of Steinberg, Perez v. Chiang. The plaintiffs, Assembly Speaker John Perez and Senate President pro Tem Darrell Steinberg, assert that Controller John Chiang overstepped his legal authority last June by withholding legislator paychecks for almost two weeks.
You'll recall that was the first big test of the budget process revised by Proposition 25, the 2010 voter-approved amendment to the state constitution ostensibly making it easier to approve a state budget (by a majority vote in each house), but also adding a political sweetener for the voters: no budget, no pay.
But that phrase - "no budget" - is where this dispute began. Legislators asserted that they had done their constitutional duty by sending a budget to Governor Jerry Brown by the June 15 deadline. But Brown quickly vetoed that spending plan - the first gubernatorial veto in modern California history - and Controller Chiang then quickly determined that "the numbers simply did not add up"... thus, blocking paychecks for members of the Assembly and Senate.
It was a short fight in 2011, but now we're going to get a look at the underlying question: what's the threshold for calling a budget balanced? And does the controller, or anyone else, have the power to tell legislators they're wrong and thus won't get paid?
The two sides have filed some very testy court documents in this case over the past few weeks, with arguments that Sacramento Superior Court Judge David Brown will now have to sort out.
Speaker Perez and Senate pro Tem Steinberg, represented by retired state appeals court judge Arthur Scotland, argue the only issue to be resolved is whether Prop 25 gives the state controller any new role in crunching the revenues and expenses contained in a budget approved by both houses.
"The controller did just what the Constitution's separation of powers prohibits," argues one of the Steinberg/Perez court filings. "[Chiang] took it upon himself to reweigh the estimate of General Fund revenues... and substituted his own estimate for that of the Legislature."
But Controller Chiang, represented by Attorney General Kamala Harris, throws Speaker Perez's own June 2011 press release back at him in one court filing - a press release that read, in part: "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."
Chiang goes on to argue that the lawsuit from the two legislative leaders, both his fellow Democrats, "would neuter Proposition 25's pay forfeiture penalty."
And that shines some light on what will be a key part of this courtroom debate on Tuesday: is this a systemic fight over separation of powers -- the executive branch, to which Chiang belongs, versus the legislative branch? Or is this a more personal fight about legislators who were angry that they weren't paid?
Perez and Steinberg assured reporters in January that it's about the principle and the ensuing precedent, and said that's why the lawsuit isn't asking for legislators to be paid back the salary they lost. But it's also true that a number of rank-and-file legislators both publicly and privately seethed at having their paychecks canceled. And while they may realize the negative PR they'd almost certainly would get for asking for back pay... they also wouldn't mind cashing those checks if it comes to pass.
The outcome of the case is especially important for this year's budget negotiations. While Democratic legislative leaders and Governor Brown seem largely on the same page about budget priorities and the need for additional taxes via a November ballot initiative, there's still some healthy disagreement about a number of Brown's proposals. And should the governor and legislators find themselves at loggerheads on Friday, June 15, 2012... well... what happens to those 120 politician paychecks?
Stay tuned... this one could get interesting.