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Newsletter: California’s budget deadline? Hardly

Essential Politics
(Los Angeles Times)

For almost a half-century, June 15 has been the designated date by which the California Legislature must act on the state budget. The requirement was given some teeth almost a decade ago, triggering a forfeiture of legislators’ pay for every day the budget is late.

But here’s a news flash: The bill to be ratified Monday by both houses of the Legislature won’t put in place a new state budget. It only lays out a rough framework — and even then, one lacking the endorsement of the guy who must ultimately sign it, Gov. Gavin Newsom.

The rules laid out in the California Constitution have always had very noticeable loopholes.

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50 years of California budget loopholes

Voters imposed the June 15 budget deadline with a 1970 ballot measure that, for 40 years, came with no consequences. Records show the constitutional requirement was met only four times before 2011.

It was only when a budget stalemate dragged on beyond July 1, the beginning of California’s new fiscal year, that problems arose. The latest budget ever signed into law was the one enacted on Sept. 23, 2008. Twice in the modern era, the delay forced the state to issue IOUs.

Enter the rules established by Proposition 25 in 2010, sold to voters as a way to end the long streak of summertime gridlock. The ballot measure removed the real obstacle to on-time budgets: a 1933 rule requiring a supermajority vote in both legislative houses. For decades, it meant the budget needed bipartisan support.

The 2010 ballot measure lowered the budget threshold to a simple majority, which Democrats could easily muster on their own. But it was a Democratic governor, Jerry Brown, who refused to go it alone in 2011. Declaring the legislative proposal “unbalanced,” Brown vetoed it. The state’s controller, John Chiang, then said legislators shouldn’t be paid because they had failed to put a budget in place.

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Not so fast.

Trial and appellate courts later ruled that Chiang was wrong, that Proposition 25 only requires the Legislature to pass a budget — meaning it’s irrelevant what happens once the document leaves their hands. They pass it, they get paid.

Which brings us to Monday. Legislators will surely pass a budget bill, but they will have a lot of work left to do in striking a deal with Newsom and approving it once it’s been detailed in a series of other budget-related bills.

One final note: Those additional budget bills aren’t really subject to any deadlines. Most will be written and adopted before July 1, but a few of the so-called budget “trailer bills” are often crafted months later.

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Newsom vs. lawmakers on ‘trigger cuts’

The fact that Monday has arrived without a full deal between Newsom and Democratic legislative leaders is a reflection of their sharp disagreement on how California’s spending plan should address the need for at least $14 billion in new coronavirus relief from President Trump and Congress.

Newsom’s May 14 proposal was to cut spending now and hope that the feds send enough money to reverse the cuts this summer. Lawmakers flatly rejected that plan, opting instead to write a budget that assumes the money will arrive by early fall and only enacting automatic “trigger cuts” in spending if that doesn’t happen.

So many of the biggest budget choices flow from that one disagreement. Using the more optimistic legislative approach, K-12 schools would make plans for the new academic year based largely on their current spending needs — albeit with the state delaying some cash payments and forcing local schools to use their own reserves or borrow what’s needed. Newsom’s approach, a sizable cut in school spending, has been called unworkable by some K-12 officials.

Regardless, the unprecedented nature of the coronavirus-induced recession will probably require substantial budget revisions by late summer. Millions of taxpayers who normally pay their personal income taxes by April 15 were given a reprieve until July 15 and the final tally could require even more difficult choices before the November election.

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National lightning round

— Against the backdrop of another Black man’s death at the hands of a white police officer, this time in Atlanta, Republican allies of Trump clashed Sunday with Democrats over police-reform legislation expected to be a focal point this week on Capitol Hill.

— Trump told graduating West Point cadets on Saturday that America’s institutions are strongest when they steer clear of societal flash points, only days after pulling Pentagon leaders into a controversial photo op and stirring up arguments over the legacy of Confederate leaders.

— Election officials and activists in four Georgia counties say thousands of mailed-in votes may not have been counted in the state’s primary.

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— Trump’s big rally on Juneteenth? He’s changed his mind.

— A spate of polls in recent weeks have shown Joe Biden building a substantial lead in his race against the president.

— Nearly six weeks after Trump stopped daily televised coronavirus briefings at the White House, he has a new tactic: ignoring the threat.

California’s essential politics

— Newsom’s unilateral decision-making during the pandemic has fueled bipartisan frustrations in the Legislature, where lawmakers are still struggling to balance the scales of power.

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— California voters would be asked to erase the state’s 24-year ban on affirmative action in November under a proposal now pending with the state Senate, as supporters argue their effort is more important than ever amid nationwide protests for racial equality.

— California’s judicial leaders have rescinded an emergency coronavirus order that set bail at zero for defendants accused of low-level crimes.

— California’s gas tax is set to increase July 1, but some lawmakers are calling for a freeze on the higher levy, citing the likely financial burden on millions of the state’s residents.

— A coalition of Native American tribes sued the state seeking more time to qualify a sports betting initiative for the 2022 ballot, arguing the coronavirus shutdown kept them from collecting voter signatures.

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— The last of the California Department of Motor Vehicles’ 169 field offices that were closed because of the COVID-19 pandemic reopened to customers who already have appointments, but not all services will be available.

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