Posted on 08/25/2002 10:46:30 AM PDT by Ernest_at_the_Beach
SACRAMENTO – As a state budget deadlock nears a two-month record, Gov. Gray Davis is trying to put pressure on Assembly Republican holdouts by showing that the lack of a spending plan is hurting Californians.
But in an ironic twist, one reason money continues to flow to core state programs without a budget is a series of lawsuits filed by Davis a decade ago when he was state controller.
The shoe was on the other foot then: A Republican governor, Pete Wilson, was trying to put pressure on Democratic holdouts in the Legislature, but Davis, as the Democratic controller, filed lawsuits to keep the money flowing.
Now Davis' successful lawsuits from a decade ago have helped prevent the lack of a state budget from creating a full-blown crisis that could bring public pressure for a budget solution.
"I guess you could say he took his own stick away," said Rick Chivaro, chief counsel for the current controller, Democrat Kathleen Connell. "You have a different situation, and things like that happen."
Chivaro, who recalls working on the lawsuits, said that among other things, court decisions obtained by Davis when he was controller keep money flowing to state workers and various welfare programs when there is no budget.
In a role reversal, Davis last week rejected a proposal by Assembly Republicans for a temporary measure allowing payments until Sept. 15 for student grants, disability centers and other contractors.
"The solution to the problem is to break the budget impasse, not break the budget up into little pieces," Davis said. "The Republicans have the responsibility of passing a budget, not funding one program at a time."
The Senate approved a $99 billion budget before the new fiscal year began July 1, with a vote from all 26 Democrats and one maverick Republican. Assembly Republicans want to replace a $3.9 billion tax increase with spending cuts.
Republicans say the Senate budget papers over a record $23.6 billion deficit until after the November election, producing a $10 billion deficit next year. Davis says Republicans have refused to list the cuts they want, making talks pointless.
Davis, with no success so far, privately has been trying to line up the four Republican votes needed to pass a budget in the Assembly, if all 50 Democrats support the plan. A two-thirds majority is needed to pass the budget in the 80-member Assembly and 40-member Senate.
Shortly before the fiscal year began, the Davis administration tried to build pressure for passage of a budget by notifying counties that a recent court ruling prevented state welfare payments when there is no budget.
But Connell, who has been at odds with fellow Democrat Davis on other issues, sent the welfare money to counties, saying the appellate court ruling was not final because it was being appealed to the state Supreme Court.
Two weeks into the deadlock, Davis said that Assembly Republicans were putting firefighter operations "at risk" because contractors who drop aerial retardants and provide other services cannot be paid without a budget.
Davis' warning came as a firefighters union briefly ran television ads in Sacramento with a similar message. Republicans said they were confident that despite the financial strain, firefighting services would continue.
Although court decisions and legislation keep money flowing to many programs, the typical state contract contains a provision saying the contractor will not be paid when there is no budget.
Connell's office estimates that the contractors are owed about $600 million a month. The state will pay interest of one-quarter of 1 percent per day, said General Services, totaling about $1.7 million by the end of this month.
During a budget deadlock four years ago, the Howard Jarvis Taxpayers Association filed a lawsuit to prevent the state from paying bills when there is no budget.
The taxpayers group was dismayed that the state was paying some bills during routine budget deadlocks, while ignoring others. The group said the state either should pay no one or pay everyone through emergency legislation.
"We are the ones who are fighting to basically have everything equal," said Richard Fine, the Jarvis association attorney.
A Los Angeles Superior Court judge issued an order in the Jarvis suit July 21, 1998, barring state payments without a budget. The Legislature approved an emergency two-week budget the next day.
After nearly four years, an appellate court issued a ruling last May in the Jarvis lawsuit that said the state can make payments without a budget if there is authorization in federal law, the state constitution, or state statutes.
Connell's office believes the main effect of the appellate ruling is that, without a budget, state worker salaries would be limited to the federal minimum wage, $6.75 an hour.
The appellate ruling has not taken effect because the state Supreme Court agreed earlier this month to hear an appeal. A decision is not expected until some time next year.
Meanwhile, the controller's office last week found authorization in the 1998 emergency legislation for a two-month payment to 21 regional centers that care for 170,000 disabled clients, averting shutdowns or service reductions.
Among other problems caused by the budget deadlock, the state has not been able to issue Cal Grants to 200,000 students. The University of California and California State University are covering the grants by shifting other funds.
There is concern that some community colleges, which have fewer resources, will not be able to aid students who use the grants to buy books and pay for transportation and other living expenses.
The state has not been able to mail annual payments for more than 400,000 claims, averaging a little more than $300 each, to persons receiving aid to the aged, blind and disabled to help them pay their rent or property taxes.
About 750 licensed nonprofit community health clinics that care for the poor are not being paid through two programs for children and expanded care. The clinics are owed $5.3 million for the first eight weeks of the deadlock.
Vietnam Veterans of San Diego, which gets about one-fifth of its budget from the state, operates six facilities. It has been forced to limit job training and admissions to its 87-bed primary care facility.
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Government Tricks :
What's mine is mine, and what you have left is up for negotiation.
That, in essence, is the standard political trick all of our politicians employ to dull our brains. For example, rather than discussing how much revenue the government needs, the pols always start with the assumption that every penny they now have is absolutely essential and is being spent wisely to meet a critical need.
Have fun!
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