The Howard Jarvis Taxpayers Association demanded Friday that Controller John Chiang withhold pay from lawmakers and threatened to sue if he does not.
The group's president, Jon Coupal, wrote that under its interpretation of voter-enacted Proposition 25, lawmakers must pass a balanced budget to receive pay. He noted that Gov. Jerry Brown determined Thursday that Democrats' majority-vote budget was not balanced.
"If you pay legislators for enacting a phony budget, then you have made Proposition 25's provision prohibiting pay meaningless," Coupal wrote. "We urge you to confirm your intent to withhold pay and force the Legislature to get back to work immediately."
Dispute remains over whether Proposition 25 requires that lawmakers send the governor a balanced budget, as well as what defines "balanced." During and after the 2010 campaign, it was thought that lawmakers might be able to send the governor any budget by June 15 to meet the pay requirement.
Chiang, who issues paychecks, declared earlier this month that lawmakers must send a balanced budget.
Democratic leaders said this week they had fulfilled their obligation. But Brown, in his veto letter, said the budget was not balanced and "not financeable," meaning not good enough to borrow against.
Brown vetoed the Democratic budget on Thursday, but a gubernatorial veto has no bearing on legislative pay under Proposition 25.
The Democratic controller said Thursday he needed more time to analyze the budget bills to determine whether Democrats met their obligation.
Chiang spokeswoman Hallye Jordan said in an e-mail statement, "The Controller's decision will be driven exclusively by the rule of law, not by threats, intimidation, or political considerations."