Unique Provisions of California’s Budget Bill – Part VII

The California state budget is the largest in the nation, and it also represents the largest bill in page length and number of provisions. While its provisions are too many to cover, there are a number of them that are unique and readers should be aware of them. This article is the seventh in a series.

So, what are some of these unique provisions of California’s Budget Bill?

Use of Reimbursements

This section (Section 28.50) authorizes departments and other agencies of the state to expend all moneys received as reimbursement from another state agency upon the prior, written approval of the Director of Finance. However, any expenditure of reimbursements or any transfer for the fiscal year that exceed $200,000, the Director of Finance is required to provide written notification of any approval granted under this section to the respective Assembly and Senate committees as designated.

Listing of State Positions

This section requires the Department of Finance to publish a listing of all position in every state department and agency. This listing will be published three times per year. The following is an example of this language from a state budget bill:

SEC. 29.00.

The Department of Finance shall calculate and publish a listing of total positions for each department and agency. These listings shall be published by the Department of Finance at the same time as the publication of (a) the Governor’s Budget, (b) the May Revision, and (c) the Final Change Book.

(a) The listing provided at the time of the publication of the Governor’s Budget shall contain actual filled positions for the past year, an estimate of positions for the current year, and proposed positions for the budget year.

(b) The listing provided at the time of publication of the May Revision shall contain estimates of positions proposed for the budget year.

(c) The listing provided at the time of the publication of the Final Change Book shall contain estimates of positions for the fiscal year just enacted.

Departmental Budgets

This section (Section 31) requires appropriations made by the California Budget Bill to be made in accordance with the allotments and other provisions of departmental budgets approved by the Department of Finance. These departmental budgets must authorize all established position whose continuance for the year is approved. Authorization by the Department of Finance is required for positions above specified maximum salary, and certain establishment of new positions.

In addition, this section requires the Department of Finance to retain for a period of not less than two years documentation concerning position changes approved as specified. Thereafter, it provides a statement of legislative intent concerning legislative approval of positions administratively established. The following is an example of this language from a state budget bill:

(d) It is the intent of the Legislature that all positions administratively established pursuant to this section that are intended by the administration to be ongoing be submitted to the Legislature for approval through the regular budget process as soon as possible. All positions administratively established pursuant to this section during the 2022–23 fiscal year shall terminate on June 30, 2023, except for those positions that have been (1) approved by the Legislature as part of the regular budget process for the 2023–24 fiscal year as new positions or (2) approved by the Department of Finance after the 2023–24 Governor’s Budget submission to the Legislature and subsequently reported to the Legislature prior to July 1, 2023. The positions identified in (2) above may be reestablished by the Department of Finance during the 2023–24 fiscal year, provided that these positions are shown in the Governor’s Budget for the 2024–25 fiscal year as submitted to the Legislature, and provided that these positions do not result in the reestablishment of positions deleted by the Legislature through the budget process for the 2023–24 fiscal year. The Department of Finance shall provide written notification to the Chairperson of the Joint Legislative Budget Committee within 30 days of the reestablishment of positions approved in the 2023–24 fiscal year pursuant to (2) above.

(e) Moneys appropriated in the 2022–23 fiscal year may be expended for increases in salary ranges or any other employee compensation action only if appropriated for that purpose, or if the Department of Finance certifies to the salary and other compensation-setting authority, prior to the adoption of the action, that funds are available to pay the increased salary or employee compensation resulting from the action. Prior to certification, the Department of Finance shall determine whether the increase in salary range or employee compensation action will require supplemental funding in the 2023–24 fiscal year. If the Department of Finance determines that supplemental funding will be required, the department may certify only if it notifies in writing, at least 30 days before, the chairpersons of the committees in each house of the Legislature that consider appropriations and the Chairperson of the Joint Legislative Budget Committee, or a lesser time which the chairperson of the joint committee, or the chairperson’s designee, determines.

(g) Requests to continue administratively established positions as ongoing positions pursuant to subdivision (d) shall include information on the date the positions were administratively established. This information shall be included in the administration’s budget change proposals and finance letters. If the administration requests to establish new positions in the 2023–24 fiscal year, and subsequently decides to administratively establish the positions in the 2022–23 fiscal year, the Department of Finance shall provide written notification to the Chairperson of the Joint Legislative Budget Committee within 30 days of the administrative establishment of the positions.

(h) This section applies to all state agencies, departments, boards, bureaus, and commissions.

Prohibition on Excess Expenditures

This section (Section 32) prohibits any state officers from making any expenditures in excess of the appropriations contained in the California Budget Bill. Moreover, “any indebtedness attempted to be created against the state in violation of this section shall be null and void, and shall not be allowed by the Controller nor paid out of any state appropriation.”

In addition, this section provides that any member of a department, board, commission, or institution who votes for any expenditure, or creates any indebtedness against the state in excess of the respective appropriations made by this act, is liable both personally and on the member’s official bond for the amount of the indebtedness, to be recovered in any court of competent jurisdiction by the person or persons, firm, or corporation to which the indebtedness is owing. There are a number of exceptions to this personal liability provision.