A new post on Controller John Chiang's website mentions state employee payroll is one of several obligations that his office will continue to pay even if lawmakers fail to pass a budget by the end of this month.
Chiang spokesman Jacob Roper said that the payroll figure, $2.1 billion for July, comes from Gov. Arnold Schwarzenegger's May budget revision and assumes the payroll cost reductions he has proposed for fiscal 2010-11. The governor has proposed cutting all state workers' pay by 5 percent and upping their pension contributions by another 5 percent of their gross pay, but there's no sign an agreement will be in place before the fiscal year begins July 1 to implement the pay cuts.
The controller also sent this letter to lawmakers, triggered by their usual failure to get a budget done by the June 15 deadline laid out in the constitution.
"At a time when the economy is showing signs of recovery, we can ill-afford the 'business as usual' approach of requiring the state to be driven to the brink of a fiscal meltdown before compromise is achieved."
This story by Bee Capitol Bureau colleague Jim Sanders has more about the largely symbolic deadline.
"Please be assured that I will continue to do everything within my authority to continue to provide payments for essential services," Chiang says on a webpage titled, "What the State Controller Can and Cannot Pay Without an Enacted Budget."
Chiang's notice comes less than a week before attorneys for the controller and Gov. Arnold Schwarzenegger will argue in Sacramento's 3rd District Court of Appeal whether the controller must comply with orders to withhold state worker pay to the federal minimum when there's no budget with money appropriated for payroll. A lower court last year told Chiang that he didn't have the authority to refuse.
Some employee groups won't be paid if budget talks drag into July: legislators and legislative employees, statewide elected officials, appointees and other exempt workers.