California lawmakers: No budget, no pay

By Jim Christie
(Reuters) -SAN FRANCISCO 
There's no reward for a job poorly done, California lawmakers were told on Tuesday as their wages and expense pay were suspended after passing a budget that did not "add up."

Controller John Chiang on Tuesday said he was acting under terms of a law approved by voters last year, the "On-Time Budget Act of 2010," to withhold lawmakers' pay if they miss a mid-June deadline for balancing the state's books.

Democrats pushed a budget through the legislature last week, but Governor Jerry Brown, a fellow Democrat, vetoed the budget a day later, saying it was filled with "legally questionable maneuvers, costly borrowing and unrealistic savings" and didn't close a $10 billion gap.

Chiang on Tuesday vowed to withhold paychecks until lawmakers submit a balanced spending plan for the fiscal year that starts on July 1.

Last Wednesday was the deadline for lawmakers to submit a budget to Brown.

"My office's careful review of the recently passed budget found components that were miscalculated, miscounted or unfinished," Chiang, also a Democrat, said in a statement.

"The numbers simply did not add up, and the legislature will forfeit their pay until a balanced budget is sent to the governor," he said.

Assembly Speaker John Perez said Chiang's decision gives the legislature's Republican minority control of the budget process, since they have refused to vote for Brown's plans to put a temporary tax extension up to a popular vote.

Without any Republicans lending support for that, Democratic leaders said they opted to drop Brown's plan to try to push through their own budget last week.

California is notorious for late budgets. Former Governor Arnold Schwarzenegger signed the state's current budget last October, 100 days after it should have been in place.

Jack Pitney, a professor of government at Claremont McKenna College, said the loss of pay could act as a catalyst. "Withholding paychecks might lubricate discussions," he said.

A report released by Standard & Poor's Ratings Services on the heels of Chiang's statement may also encourage California's leaders to bear down on the budget.

California's already low credit rating is at a "crossroad," S&P said.

A lengthy budget impasse extending into the new year could result in a "patchwork" budget similar to one Brown vetoed, S&P said, which "may lead us to lower the state's long-term rating depending upon the severity and duration of the cash crisis that we believe could precede it."

Legislators were quick to voice their discontent.

"Our state government right now reminds me of a troop of boys lost in the wilderness," Democrat Mike Gatto said in a statement.

(Reporting by Jim Christie; Editing by Leslie Adler)