‘Ghost Workers’ Haunt the State Budget Process

As the standoff over California’s $101-billion budget pushes into its second week, Republicans and Democrats remain divided over taxes, school funding--and ghosts.

Ghost employees, that is.

GOP lawmakers are continuing their push to eliminate the so-called phantom jobs from government payrolls. Those posts are the byproduct of the grueling recession that hit California during the early 1990s, and the debate over them illustrates some of the complexities that complicate reaching agreement on the state’s spending plan.

Faced with spending cuts triggered by a $14-billion deficit during the state’s economic lean times, state bureaucrats engaged in a practice of leaving some positions empty so they could tap unspent salaries to balance their diminished budgets. More recently, positions have stayed open for a different reason: A tight job market has made it difficult for some state agencies to fill openings.

Senate Republican Leader Jim Brulte of Rancho Cucamonga contends there are as many as 10,700 “excessive vacancies” and that more than $400 million in salaries attached to the positions could be redirected to the general fund. He wants to use the money to help cover his party’s call for an extension of a quarter-cent cut in the state sales tax--a major sticking point in ongoing budget talks.

Officials in Gov. Gray Davis’ administration dispute the Republicans’ calculations, which they contend do not take into account a number of factors. They include the use of unspent salaries to hire temporary workers to fill vacant slots or to cover overtime costs incurred when workers put in extra hours to make up for staff shortages at state hospitals and prisons.

At most, they contend, about $50 million could be redirected to the general fund by eliminating a little more than 1,600 unfilled positions. But doing so, they warn, could threaten public safety or lead to decertification of 24-hour care facilities by federal authorities.

Their explanations have failed to convince Brulte, who portrays them as excuses made by bureaucrats bent on keeping the status quo.

“I don’t think they have any interest in reining in the bureaucracy,” Brulte said of the Davis administration.

Critics contend the practice has clouded the budgeting process by allowing agencies to reallocate unspent salaries without legislative approval. One agency head, for example, revealed during a budget hearing last year that he planned to use $900,000 in unspent salaries to help cover the cost of moving his staff into new headquarters.

Nonetheless, Democrats describe such examples as rare, and say the ghost employee issue is being used as a red herring by Republicans to try to justify their press on the sales tax issue.

Continuing that quarter-cent cut, which began in January but is scheduled to disappear next Jan. 1, is expected to cost state coffers, and consequently save taxpayers, nearly $600 million over six months. Acquiescing to the Republicans’ demand, according to Democrats, would come at the expense of education and other services.

“The governor is not going to sign a budget that blows a gaping hole in the reserve or guts education,” said Susan Kennedy, a top aide to Davis.

Targeting ghost employees gives the Republicans an answer to that charge: They are not aiming at schoolchildren, they say, but rather at vacant jobs, hardly a politically defensible issue.

With Republicans and Democrats still at loggerheads in their view of the budget, the spending plan has gone down to defeat once in the Senate and three times in the Assembly. Democrats control both houses, but the budget requires two-thirds approval to pass, and there are enough Republicans in each chamber to block that as long as they stick together.

The standoff caused Davis to miss a largely ceremonial deadline for having the budget signed by the new fiscal year, which began July 1.

Lower-house Democrats attempted to peel off the four GOP votes needed to approve the budget in the Assembly by serving up a series of tax breaks aimed at agricultural communities, which many Republican lawmakers represent.

Senate Democrats, who need to persuade just one Republican in their house to vote for the budget, have also indicated a willingness to grant a Republican request for voters to decide whether sales taxes paid on gasoline should be permanently dedicated to transportation.

Republicans have drawn what they describe as a “bright line” in the sand, however, over the quarter-cent sales tax issue.

On the question of the vacant positions, lawmakers approved a plan last year to require the state controller to drop from the books any jobs that have remained open for six consecutive months during the previous fiscal year. Prior to the change, a position had to be vacant from October through June.

Davis administration officials contend the governor has not waited for the new law to kick in, noting that he has wiped out 6,600 vacant jobs from the books since he took office. (About 2,500 of the slots are included in his 2001-02 budget blueprint.)

The state auditor is putting together a report on the vacancy issue, which both sides hope will ferret out the truth. But findings from the audit are not due for months.

Away from the debate over the vacant positions, budget negotiations stalled during much of last week. Davis is not expected to begin meeting with legislative leaders until they strike a general agreement on compromise points.

Brulte, meanwhile, says Davis is trying to force a break in the Republican ranks.

“I believe the administration strategy is to find one Republican in the Senate to vote for a tax increase,” he said. “I think at some point they’ll either be successful at finding the one vote they need, or they’ll decide to engage in serious discussions.”

Countered Davis spokesman Steve Maviglio: “We’ll get a budget whenever the Republicans stop sitting on a high horse. In the meantime, the governor will work with the rank and file who are willing to put the concerns of California ahead of politics.”

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Times staff writer Eric Bailey contributed to this story.