Change The Two-Thirds Budget Requirement? Not Likely

For the obvious reason that a proposed constitutional amendment to change the two-thirds vote requirement for enacting a budget itself requires a two-thirds vote. Calbuzz reports here.

Steve Westly and Fred Keeley on Constitutional Reform

Steve Westley, the former Controller, and Fred Keeley, the County Treasurer of the County of Santa Cruz, offer the open primary initiative (Prop. 14 on the June ballot) and a new budget reform initiative being prepared for the November ballot, as the key to California constitutional reform, in this piece from the Los Angeles Times.

The Two Different Two-Thirds Requirements

In this column, Dan Walters distinguishes between the two-thirds requirements for passing a budget and increasing taxes (for purposes of increasing revenue). He says the former stands a reasonable chance of being repealed, while the latter is politically untouchable.

The Los Angeles Times On The State's Business Climate

How does California rank as a place to do business? Here is an interesting article on this subject from the Los Angeles Times. The real culprits: traffic gridlock and the lack of an educated workforce. And George Skelton picks the winners and losers in the budget battles, both short-term and long-term, here.

Dan Walters on Young v. Schmidt

He's pessimistic about the lawsuit's chances (here). The case is still pending before the California Supreme Court. (Full disclosure: I will be representing the Respondents in the case.) And here is Walters' take on the deeper problems causing the budget crisis, and suggesting that a constitutional convention may be the fix.

Harold Meyerson on the California Constitution

Harold Meyerson of the Washington Post pens this op-ed piece for the Los Angeles Times attacking the two-thirds requirements to pass a budget and raise revenue through tax increases.

HJTA Moves To Intervene in Two-Thirds Vote Case

The Howard Jarvis Taxpayers Association has moved to intervene in Young v. Schmidt, the case challenging the two-thirds rules for passing a budget and raising taxes to increase revenue. A copy of the motion is here. According to the court's docket, the Petitioner will oppose the motion.

Ideology Divides Tax Panel

A foretaste of what could happen to a constitutional convention. Dan Walters reports in the Sacramento Bee (here).

Limits on Transportation Funding Upheld

In Shaw v. People ex rel. Chiang (here), the Court of Appeal invalidated several legislative appropriations that it said violated restrictions on the permissible uses of transportation funding contained in a series of initiatives and legislative constitutional amendments. While much of the case involves the precise wording of the various provisions at issue, from a constitutional perspective there are two interesting holdings.

First, the court considered the interplay between Article IV, Section 9, which provides that a "section of a statute may not be amended unless the section is re-enacted as amended," and Article II, Section 10(c), which says that an initiative can't be amended, except by another initiative, unless the initiative itself permits amendments. Here's how the issue arose. Revenue and Taxation Code Section 7102 is a statute that distributes the state's share of the sales and use tax. An initiative added a subdivision to the statute that limited the permissible uses of a portion of sales tax revenue derived from the sale of gasoline. However, because of Article IV. Section 9, the initiative had to reenact the entire statute. That wouldn't have mattered much, except that the initiative also provided that future amendments to the statute (not just the subdivision of the statute added by the initiative) could be enacted by the Legislature, but only if the amendment was consistent with, and furthered the purpose of, the measure.

The trial court held that amendments to the entire statute had to comply with this requirement. However, it also held that, since the purpose of the entire statute was to distribute sales tax revenue, any amendment that did that furthered the statute's purpose and was thus permissible. The Court of Appeal disagreed, rightly holding that this interpretation would make any amendment of the statute permissible, thus essentially eliminating the consistency requirement. Instead, the court held that any amendment to the statute as a whole had to be consistent with, and further, the purpose of the initiative, which was to provide a dedicated source of revenue for mass transportation.

That's fine as far as it goes, but it leaves an important question hanging. Suppose the Legislature wanted to amend a subdivision of the statute that had nothing to do with transportation funding. Under the decision, the amendment would be invalid, unless it was approved by the electorate, because by hypothesis it wouldn't further the initiative's purpose. That seems like quite a stretch, particularly since the court acknowledged that the initiative's failure to limit the amendment-restricting language to the particular subdivision of the statute, rather than the statute as a whole, was probably an oversight.

The second aspect of the court's decision that is interesting from a constitutional perspective is its treatment of initiative language restricting legislative budget-making. In People's Advocate v. Superior Court, the same court had invalidated a provision of an initiative statute that purported to limit future Budget Act appropriations for the Legislature. (Jerry Falk and I represented the Assembly in that case.) But the court also said that an initiative could appropriate money without posing a constitutional problem, if the initiative provided for a continuing appropriation. Since the initiative involved in the Chiang case did that, its limitation on the use of pre-existing funds was not invalid under People's Advocate.

This decision is not good news for the Legislature, particularly given the state's budget crisis. But it won't become effective until the Supreme Court either decides the case or denies review. Stay tuned.

No Change, No Surprise

All the budget initiatives went down to defeat last night, except for a silly measure that ties legislative pay to budget deficits. None of the others got more than 38%. The San Francisco Chronicle reports here; the Los Angeles Times reports here; and here is the Sacramento Bee's report.

Targeting The Two-Thirds Requirements

The San Francisco Chronicle reports here on efforts to amend the two-thirds requirements for passing a budget and increasing taxes. Too bad these measures won't be on the May ballot--they would probably pass in a heartbeat.

Can The Governor Cut The Lieutenant Governor's Budget by Two-Thirds?

Accoprding to news accounts (here), the Governor in signing the budget has cut the budget of the Lieutenant Governor's office by approximately 65%. Can he do this? Cases such as Scott v. Common Council, 44 Cal. App. 4th 684 (1996), suggest that budgetary authority can't be used to interfere with the ability of a constitutional officer to perform his or her duties. And 65% seems like a pretty major cut.

HJTA Files Reply In Support Of Petition In Budget Case

The Howard Jarvis Taxpayers Association has filed its reply (here) in support of the Petition for Review it filed in the Prop. 13 budget case. To recapitulate, the underlying issue is whether the Legislature violated the two-thirds vote requirement for new taxes imposed by Prop. 13 when it passed a budget in December by a majority vote. That budget never became effective because it was vetoed by the Governor. (Full disclosure: I represent the Legislature in this case.) The Court of Appeal's ruling in the case is referenced here.

News Articles On The Budget Deal

Here is the report from the Los Angeles Times. The deal includes proposed constitutional changes, which, among other things, would determine the duration of new taxes that are also part of the deal. Here is the article from the Sacramento Bee and here is the article from the San Francisco Chronicle.

Legislature Files Answer In Budget Case

The Legislature has filed its Answer to Petition for Review in the Proposition 13 case brought by the Howard Jarvis Taxpayers Association. A copy is available here. The HJTA has ten days from last Monday to file a reply. The answer was prepared by yours truly and the Office of the Legislative Counsel.

Senator Leno Explains The Budget Crisis

State Senator Mark Leno, of Sonoma, San Francisco and Marin counties, explains some of the reasons for the state's budget crisis in this article from the San Francisco Chronicle. The article focuses almost exclusively on the expenditure side, without looking at the revenue side, which is natural enough in an article entitled "Who Increased State Spending in California"? The somewhat surprising answer? You did.

The Latest on the Budget Crisis

Today's San Francisco Chronicle details how the budget crisis is starting to hit (here), while Dan Walters of the Sacramento Bee offers his thoughts on a spending cap as part of a potential budget deal (here). And here is the Chronicle's latest report on the drive for a constitutional convention. According to the article, the Bay Area Council (the originator of the drive for a convention), along with the League of Women Voters, is co-sponsoring a daylong California Constitutional Convention Summit in Sacramento on Tuesday, Feb. 24. Speakers will address how a convention would be put together and what it would discuss. For more information, go to www.repaircalifornia.org.

New Poll On The Budget Crisis

Today's San Francisco Chronicle describes a poll conducted by the Public Policy Institute of California on potential solutions to the State's budget crisis. The news article is here while here is a link to the poll results themselves.

HJTA Files Petition for Review in State Budget Case

The Howard Jarvis Taxpayers Association has filed a petition for review in the lawsuit challenging the Legislature's approval by majority vote of n0w-vetoed budget legislation. The text of the Court of Appeal's denial of HJTA's petition for writ of mandate is here. The petition for review is here.

Can The Governor Compel State Workers To Take A Furlough?

Governor Schwarzenegger has tried to require state workers to contribute to solving the state's budget crisis by taking two unpaid leave days per month. Does this violate the Legislature's right to set the salaries of state employees? The unions and the Controller think so. The Los Angeles Times reports here.