November 23, 2009
Pursuant to Elections Code 9005, we have reviewed
the proposed constitutional amendment related to the passage of the
state budget (A.G. File No. 09‑0057).
Background
Process for Passing a Budget. The
State Constitution vests the Legislature with the power to appropriate
state funds (and make midyear adjustments to those appropriations). The
annual state budget act is the Legislature's primary method of
authorizing expenses for a particular year. Specifically, the
Constitution requires that (1) the Governor propose a budget by January
10 for the next fiscal year (beginning July 1) and
(2) the Legislature pass the annual budget act by June 15. The Governor
may then either sign the budget or veto all or part of it. By a
two-thirds (67 percent) vote in each house of the Legislature, a
gubernatorial veto may be overridden.
Two-Thirds Vote Requirement for Passage of
State Budget. The Constitution requires a two-thirds vote of
each house of the Legislature for the passage of the annual budget act,
other General Fund appropriations (except appropriations for public
schools), other measures that take effect immediately (other than for
the calling of an election), and bills that raise state taxes. The
Constitution requires the Legislature to pass the budget bill by June 15
each year—in advance of the July 1 start of the state's fiscal year.
Certain budget actions (for example, a decision by the Legislature and
the Governor to change the types of services that the state provides)
require changing state law. Such changes in law often are included in
"trailer bills" that accompany passage of the budget each year. In order
for these trailer bills to take effect immediately rather than, as with
most other bills, on January 1, they must be passed by a two-thirds vote
of each house.
Late Budgets. When a fiscal year
begins without a state budget, most expenses do not have authorization
to continue. Over time, however, a number of court decisions and
interpretations of the Constitution by the State Controller and other
officials have expanded the types of payments that may continue to be
made when a state budget has not been passed. For example, state
employee salaries currently continue to be made in this scenario with
several notable exceptions—such as the salaries of the Governor, other
elected state officials, Members of the Legislature, and their appointed
staff, who receive no salaries after July 1 until a budget is passed.
Any salary payments which are withheld from these officials then are
paid upon passage of the budget.
Proposal
Lowers the Vote Requirement to Pass the
Budget Bill and Related Legislation. This measure amends the
Constitution to lower the vote requirement necessary to pass the budget
and related legislation from two-thirds to a majority (50 percent plus
one). The lower vote requirement would also apply to bills that the
Legislature identifies "as related to the budget in the budget bill
passed by the Legislature." This measure does not change the vote
requirement for increasing state taxes.
Late
Budgets Would Result in Forfeiture of Pay and Reimbursements for
Legislators. In any year when the budget bill is not
passed by the Legislature by midnight on June 15, this proposal
prohibits Members of the Legislature from collecting any salary or
reimbursements for travel or living expenses from a current or future
budget during any regular or special session. This prohibition would be
in effect during the period from midnight on June 15 until the day that
a budget is presented to the Governor. Lost salaries and expenses could
not be paid retroactively.
Fiscal Effect
State Spending Easier to Enact.
This measure, by reducing the voting requirement from two-thirds to a
majority, could make it easier to pass a state budget. In some years,
this could affect the content of the budget and related appropriations.
For instance, spending priorities in a given budget could be different.
The extent of the impacts would depend on a number of factors—including
the state's financial circumstances, the composition of the Legislature,
and its future actions.
Some Pay May Be Forfeited. In years
when the budget bill is not passed by June 15, Legislators would forfeit
any salary or reimbursement for living and travel expenses. In any year
that the Legislature does not pass a bill by June 15, the measure could
reduce state costs by around $50,000 per day until the passage of a
budget.
Summary of Fiscal Effect
This measure would have the following fiscal
effects:
-
Unknown changes in the content of the state
budget from lowering the legislative vote requirement for passage.
Fiscal impact would depend on the composition and actions of future
Legislatures.
-
Minor reduction in state costs related to
compensation of legislators in years when the budget bill is passed
after June 15.
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