News Cut: May 5, 2010 Archive

The unallotment decision

Posted at 9:59 AM on May 5, 2010 by Bob Collins (8 Comments)
Filed under: Crime and Justice, Politics

The Minnesota Supreme Court is releasing its decision in the case challenging Gov. Tim Pawlenty's authority to cut the state budget on his own. The case was argued in March.

10:05 a.m. - The Court says the unallotment was unlawful.

10:08 a.m. - Here's the decision. I'll be highlighting key points in a few minutes.

10:12 a.m. - Chief Justice Eric Magnuson wrote the decision, which must be a cruel blow to the Pawlenty administration. The governor appointed Magnuson to the position. He has announced his retirement after several years of feuding with the administration over court funding.

10:17 a.m. - The court did not address whether the governor's actions were unconstitutional. It said that it avoids constitutional decisions if there's another basis on which to rule in the case. That would certainly appear to invite more unallotment actions by the governor if the court's uneasiness with the other "basis" can be settled.

The inherent authority of the executive branch concerning actual spending decisions once appropriations are made is not, however, directly implicated in the issue we decide today, that is, whether Minnesota's unallotment statute was properly invoked in this case

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10:21 a.m. - The court hints that it might not be a bad idea for the Legislature to fix the law under which Pawlenty exerted his perceived authority:

Although the competing interpretations advanced by the parties are each reasonable, that fact simply brings into focus the failure of the statutory language to clearly answer two questions: (1) probable receipts anticipated when? and (2) amount available for what purpose? Because we determine the language of the unallotment statute is ambiguous, we must employ the canons of construction to determine what the Legislature intended by the language it used.

10:25 a.m. - The "money quote". Literally.

In the context of this limited constitutional grant of gubernatorial authority with regard to appropriations, we cannot conclude that the Legislature intended to authorize the executive branch to use the unallotment process to balance the budget for an entire biennium when balanced spending and revenue legislation has not been initially agreed upon by the Legislature and the Governor. Instead, we conclude that the Legislature intended the unallotment authority to serve the more narrow purpose of providing a mechanism by which the executive branch could address unanticipated deficits that occur after a balanced budget has previously been enacted.

10:26 a.m. - While not addressing the constitutionality of the governor's actions, it certainly portrays a constitutional question of whether unalloting items approved by the Legislature neuters the Legislature.

The unallotment authority so construed would result in an alternative budget-creation mechanism that bypasses the constitutionally prescribed process. There is nothing to suggest that was the purpose for which the unallotment statute was enacted

10:30 a.m. - So, here's the "perfect storm" for DFLers that gives them the "win" on this issue. They didn't balance the budget and the unallotment authority, the court said, is used to adjust unanticipated deficits:

The unallotment statute provides the executive branch with authority to address an unanticipated deficit that arises after the legislative and executive branches have enacted a balanced budget. The statute does not shift to the executive branch a broad budget-making authority allowing the executive branch to address a deficit that remains after a legislative session because the legislative and executive branches have not resolved their differences.

Which, presumably, means that if the Legislature had delivered a fully balanced budget, and there were no major disagreements, and then the deficit appeared, Gov. Pawlenty's actions could have been legal.

10:33 a.m. - Justice Alan Page takes on the constitutional question:

I write separately to highlight my concern that the unallotment statute confers on the executive branch such broad and uncircumscribed authority to rewrite legislative spending decisions that it may constitute an unlawful delegation of legislative authority in violation of the separation of powers principle in our constitution.

10:35 a.m. - It might not be a bad idea, Justice Page signals, for the Legislature to work on cleaning up the language of the process to avoid a constitutional question. Perhaps it could get fast-tracked as if it were a stadium bill. He didn't write that part. I did.

The lack of direction in the Minnesota statute about how unallotment authority may be exercised once it is triggered leaves the executive branch with virtually unfettered discretion to decide which funds to cut entirely, which to reduce in some measure, and which to leave fully funded. Such decisions inevitably change the legislative priorities established in the properly enacted appropriations laws, and the grant in subdivision 4 of section 16A.152 to the executive branch of broad and uncircumscribed authority to make such changes may run afoul of the separation of powers principle. Although we need not decide that issue today, the legislative and executive branches should be aware of that potential problem.

Rest assured, of course, that Minnesota Public Radio will be providing plenty of coverage of this during the day. In a few minutes, on MPR's Midday, state rep and gubernatorial candidate Tom Emmer will appear. My guess is he'll have something to say about this decision.

(8 Comments)

Unallotment: The dissent

Posted at 3:58 PM on May 5, 2010 by Bob Collins (6 Comments)
Filed under: Crime and Justice, Politics

With our Internet connectivity woes today, I've been unable until now to dive into the "other side" of the unallotment decision from the Minnesota Supreme Court. That is, the dissent filed by Justice Lorie Gildea. Like Chief Justice Magnuson, who wrote the decision, Gildea is an appointee of Gov. Tim Pawlenty.

Gildea, in her dissent, does everything but use the term "judicial activists" to describe the four justices who ruled against the governor.

The judiciary's duty is simply to apply the law as written by the legislature.The majority is unable to do so because the language the Legislature used in the unallotment statute leaves the majority with uncertainty and ambiguity. The majority therefore rewrites the statute to insert additional conditions, and then finds that the Commissioner of Minnesota Management and Budget (Commissioner) violated the statute because he did not comply with the conditions the majority has added.

Gildea says she did not find the law ambiguous, she also says she does not find Pawlenty's actions unconstitutional, an interesting distinction since the majority pointed out they weren't ruling on the constitutionality of the case.

Because I would hold that the executive branch complied with the plain language of the statute, and that respondents have not met their burden to prove that the statute is unconstitutional, I respectfully dissent

Justice Gildea points out that it wasn't until after the legislative session ended, that state finance officials reported the state budget was still $2.7 billion in the red for the biennium. She said because state officials found the budget deficit higher than the anticipated revenues, the power to "unallot" belonged to the governor.

Of course, it's worth pointing out, the financial wizards of the state had been wrong for many months, consistently underestimating the problems in the state budget. It's also worth noting that the governor first threatened unallotment (though not with the programs specifically mentioned in the court case) in December 2008. All the more reason, perhaps, why it might've been nice if the Supreme Court had considered the general constitutionality of the process. But it didn't, so let's move on...

Of course, all of this ignores a certain reality. The court case hinges on the timing of the actual unallotment. In reality, the Pawlenty administration had been using the threat of unallotment as a hammer for months. In reality, nobody was surprised that the governor did what he did. But a court challenge couldn't be mounted, apparently, except on the question of the timing of when the budget was sent to him, and when it was officially known that it wasn't balanced.

Respondents argue, and the district court held, that the Commissioner's unallotments violated the statute because the budget deficit was not ―previously unforeseen.‖ Respondents' argument is based on the fact that the budget deficit was known in February when the Commissioner prepared the forecast. Moreover, respondents contend that when the Governor signed appropriation legislation and vetoed revenue legislation, the Governor (and therefore the Commissioner) knew that the state would not have funds sufficient to satisfy the financial obligations in the appropriation legislation. Therefore, respondents argue, the budget deficit was not unanticipated.

Gildea comes down on the side that says the administration had all the power in this dispute:

Moreover, even if the judicial branch were inclined to wade into this dispute, it would be irrelevant in this case because there is nothing in section 16A.152 that limits the Commissioner's authority to unallot depending upon what or who is most responsible for the budget shortfall. The judiciary cannot rewrite the statute to add such restrictions.

Justice Gildea also turns the "separation of powers" argument on its head, noting that if Gov. Pawlenty has no power to unallot, then the budget power rests entirely with the Legislature.

Where one branch purports to perform completely a function assigned to one of the other branches, such encroachment violates the separation of powers principle... We have recognized that such encroachment into the judiciary's sphere of constitutional responsibility is unconstitutional. For example, where the Legislature purports to remove from the judiciary a class of cases that the constitution vests in the judiciary, the Legislature has violated the separation of powers doctrine.

She goes on to note that the Minnesota Constitution clearly delegates budgetary responsibilities to both the executive and legislative branch.

Because the function is one that the constitution commits to both branches, the unallotment statute--which simply acknowledges this joint responsibility--does not delegate pure legislative authority to the executive branch and it does not violate separation of powers. There are many instances in the operation of government, such as the prohibition against deficit spending, where the function at issue requires responsible effort from both of the political branches.

By the way, sometimes with unallotment, those affected get their money eventually. Not often, but it happens. Ethanol producers got a pile of cash in 2008 when the Legislature gave them money it took away in a previous budget crunch. That, Gildea points out, shows the Legislature retains budgetary power if it chooses to use it.

Finally, the Legislature, of course, remains free in the next legislative session to undo the unallotments as it has done in the past. The fact that the Legislature retains, and has exercised, the authority to undo the Commissioner's unallotments provides an important check on the Commissioner's exercise of discretion.

So what will this mean for the future? Here's one scenario: A government shutdown. Clearly, the Legislature did a poor job of playing "chicken" with a governor in the 2009 session, by sending him a budget and painting him into a corner. It could've simply done what it did in 2005, when it forced Pawlenty to consider a shutdown.

But there's political blood to be paid for such things and, besides, Gov. Pawlenty has shown over the years that he can make DFLers look impotent, even on matters of threatened shutdowns.

In any event, DFLers in the Legislature won a war today, and now have a very large battle to fight among themselves: How to turn their victory into a balanced budget.

(6 Comments)