‘Junior’ budget bills slip into view

During the budget negotiations in September, there was talk in the Capitol about whether it was proper – or even legal – for California lawmakers to pass two measures amending the state budget that had been adopted three months earlier.

These two bills, known as  “junior” budget bills, were approved along with a half-dozen budget trailer bills that made numerous policy changes in state law for the 2017-18 fiscal year.  Gov. Brown signed them all.

Proposition 25, among other things, allowed passage of the state budget with a simple majority vote, eliminating the two-thirds vote requirement.

To find whether the “junior” budget bills are proper, one needs to look at the California constitution – for those taking notes, we’re talking about Article IV, Section 12 — that voters amended in 2010 as part of Proposition 25.

So join us as we wade into the weeds.

Proposition 25, among other things, allowed passage of the state budget with a simple majority vote, eliminating the two-thirds vote requirement.

Under the constitution, the annual state budget dance begins after the governor submits his spending plan to the Legislature by Jan. 10 each year. The state constitution formally calls this legislation “the budget bill” and requires that it be introduced immediately in each house by the chairs of the respective budget committees.

The constitution also requires the Legislature to pass the budget bill by June 15 each year, and says lawmakers cannot send to the governor any bills that appropriate funds until “the budget bill” has been enacted.

Finally, the constitution says that only the budget bill may contain more than one item of appropriation, or spending.

Again, there is that reference to “the budget bill.” So, it appears that this language contemplates trailer bills and the “junior budget bills.”

This last constitutional requirement prompted questions about the legality of the so-called “junior” budget bills, which made a number of  spending and appropriation changes to the main budget bill.

Again, only “the budget bill” is specified in the constitution, so it would appear that a “junior” bill,  at least one adopted by a majority vote under Proposition 25, is not allowed.

Of course, the Legislature can consider any bill throughout the legislative session that makes an appropriation, but those bills can only contain one item of appropriation and are subject to a two-thirds majority vote, rather than a simple majority vote.

So far, so good. But now it gets a little murky.

There is a phrase in Section 12(d) of the constitution that says appropriations bills are required to be passed by a two-thirds majority in each house, “except appropriations for the public schools and appropriations in the budget bill and in other bills providing for appropriations related to the budget bill.”

Again, there is that reference to “the budget bill.” So, it appears that this language contemplates trailer bills and the “junior budget bills.”

The constitution says “the budget bill” and “other bills providing for appropriations related to “the budget bill” may be passed by majority vote and take effect immediately.

These measures cannot be trailer bills weeks or months after the budget bill has been adopted because they were not identified in the budget bill that passed by June 15.

But the constitution defines “other bills providing for appropriations related to the budget bill” as those that “consist only of bills identified as related to the budget in the budget bill passed by the Legislature.”

That appears to mean that trailer bills and any budget bill junior must be identified in “the budget bill” that was introduced back in January and that must be passed by June 15.

As a result, if budget trailer bills are not identified in the budget bill — one question raised is when do those bills have to be identified in the budget bill? — then they would not fall within this exemption to the super-majority vote requirement.

That does not mean these bills cannot be adopted.

It just means that these measures cannot be trailer bills weeks or months after the budget bill has been adopted because they were not identified in the budget bill that passed by June 15.

Instead, they would have to go through the process as normal policy change or appropriation bills and be subject to the appropriate vote requirement, rather than be subject to a majority vote pursuant to Proposition 25.

For example, a budget bill junior or a budget trailer bill containing an appropriation and considered after the budget bill passed, would be a regular appropriation bill requiring a two-thirds majority vote.

There is a pending lawsuit challenging a budget trailer bill that was adopted by a majority vote and that took effect immediately that changed the rules related to recall elections.

Similarly, under this interpretation, while there cannot be budget bills junior with unrelated appropriations, there can be appropriation bills that are subject to a single appropriation.

Note, courts have already opined that there can be multiple appropriations in a single bill that are within a department’s or agency’s budget. Therefore, there may be more bills with subsequent appropriations, but those could not be “junior” budget bills.

If this interpretation of the California constitution is correct, one suggested approach has been to require all budget trailer bills be adopted at the same time as the budget bill is passed, or at least prior to the start of the new fiscal year, so that trailer bills are not considered weeks or even months after the start of the fiscal year.

Again, that does not mean that the budget cannot be changed after the budget bill has been passed in June, or that statutory changes cannot be made.

Rather, it means that those budget changes must be contained in regular bills that follow the normal legislative process and normal vote requirements associated with them.

There is a pending lawsuit challenging a budget trailer bill that was adopted by a majority vote and that took effect immediately that changed the rules related to recall elections. The result of that litigation may provide the clarity that appears to be lacking currently in reading Article IV, Section 12.
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Ed’s Note: Chris Micheli is a principal with the Sacramento governmental relations firm of Aprea & Micheli, Inc. and serves as an Adjunct Professor at McGeorge School of Law in its Capital Lawyering Program.