In preparation for California’s upcoming Primary election, we are releasing a quick background on each of the Constitutional Officers and what they actually do in the California government.

Today, we are comparing and contrasting the powers of the two fiscally-oriented Constitutional Officers – California’s State Treasurer and State Controller.

The current State Treasurer is John Chiang (D), who was first elected to the position on November 4, 2014.

The Treasurer acts as the chief investment officer, banker and financier of the state government and is responsible for managing the state’s pooled money investment account (PMIA). He also sits on the boards of the state’s employee pension funds, such as CalPERS and CalSTRS.

The Public Employees’ Retirement System (CalPERS) and State Teachers’ Retirement System (CalSTRS) are significant investors/stockholders in the U.S. and global economies. The pension funds provide for the retirement of their members – state and local government employees and teachers, respectively – and also perform a variety of other services for them.

California’s PMIA is an investment account where the State Treasurer and the Pooled Money Investment Board, which the Treasurer chairs, invests California taxpayer money to fund the State budget cash flow.  At the end of April 2018, the PMIA portfolio totaled approximately $85.9 billion.

Similar to the Treasurer, the State Controller is also a fiscal officer for the California Government.

The State Controller acts as the state’s accountant, bookkeeper and auditor, tracking and controlling disbursement of state funds from the treasury. The areas of government audited and reviewed by the controller include school districts, the California State Lottery, oil and gas lease royalties, state agencies, and a multitude of local governments.

Similar to the Treasurer, the State Controller sits on the boards of both CalPERS and CalSTRS. However, unlike the State Treasurer and as mentioned in our first iteration of What Do the California Constitutional Officers Do, the State Controller is a member of the Board of Equalization.

The current State Controller is Betty Yee. She manages the outgoing money from the state funds and treasury. A common example of the Controller’s job is releasing money funds to workers employed by the State. As a matter of fact, Betty Yee’s name may be the most familiar for state employees because her name is on the checks issued to them in payroll.

It may seem at first that the differences between the Treasurer and the Controller are minimal. However, both have distinct roles in the State Government. The Treasurer is responsible for incoming and invested funds. The Controller manages the money leaving the treasury.

Molly Alcorn contributed to this post.

On this week’s episode of The CAP⋅impact Podcast, we revisit our conversation with Assembly Member JAmes Gallagher (R – Yuba City) on the Oroville Dam crisis, the series of events that led up to it, it’s impacts, and what is being done now that the crisis is over.

You might be wondering why we’re going back to this conversation, it’s because Assembly Member Gallagher put out a statement along with his counterpart in the California State Senate, Senator Jim Nielsen, in response to Governor Jerry Brown’s May revision to the state budget. Their statement reads:

We thank the Governor for heeding our and our constituents’ call to fund the repairs of the damaged levees. The increased funding of $125 million for levee repair and maintenance is welcome news to our communities. Last year alone, high water events resulted in significant damage to the levees that protect our homes and communities with an estimated $800 million in needed repairs. Maintaining and repairing these levees will require an ongoing funding commitment. While more is needed, we are pleased to see the Governor’s revised budget includes funding for this purpose.”

Given how hyper-partisan political discourse has become, the statement stood out to me because we see two Republican members of the California Legislature offering praise for a Democratic governor. But it’s also not hard to make the connection between the crisis with the Oroville Dam and “high water events” last year.

Since this is a policy podcast, obviously we talked about some legislation. One of the bill’s referenced was still pending a vote in the Senate when we recorded. That bill, AB 1270, is one of thirteen new laws already enacted by the California Legislature and Governor Brown. The other bill, AB 3045, which was recently written about in Capitol Weekly by Tess Townsend, would move oversight of the State Water Project from the Department of Water Resources – which we regularly refer to as DWR in the podcast – to “a new State Water Project Commission under the state’s Natural Resources Agency” to run the State Water Project, of which the Oroville Dam is the centerpiece.

As always, thank you for listening to this week’s podcast. If you enjoyed the show, please subscribe to it on iTunes, Apple Podcasts, or whichever podcast client you prefer. And while you’re there, please leave us a 5-star rating and a review.





The Governor’s Role in the Legislative Process (transcript)

Today’s podcast is a look at the governor’s role in the legislative process.

As you well imagine, California’s Governor is a key player in the legislative process, even though the bulk of legislation is done by the elected members of the Legislature in the Assembly and the State Senate. It’s important to appreciate the various roles that the state’s chief executive plays in the legislative process.

In a quick look at the administration and the legislative process, we know that the Governor of California has a significant impact – both with regard to specific legislation as well as the budget and funding priorities of the state.

As such, it’s critical that interested parties work with the administration throughout the legislative process, which includes the members of the Governor’s office, the Department of Finance and relevant state departments and agencies. Some of the other commonly known roles the Governor has include identifying issues for the legislature to address. He or she has the authority to call the California Legislature into extraordinary or special session. And, of course, he or she has the final say, absent a veto override, over individual bills.

Because of the Governor’s multiple roles in the legislative process, he or she can lead and influence public policy development, as well as often set the major legislative agenda items for the legislative session.

I hope you will enjoy this opportunity to look at some of the roles of the Governor, with particular attention to the chief executive’s role in the legislative process. Remember that the Governor has many tools and powers to control and influence legislation in California. As a result he or she plays a prominent role in any lawmaking by the California Legislature.

Goldilocks Testimony

AB 1784, having cleared it’s first hurdle – policy committee – moved on to the Assembly Appropriations Committee. Keri and Michelle had been told that their bill was destined for the Suspense File and that they wouldn’t need to testify. That all changed the day before, and after a flurry of text messages Keri and Michelle found themselves pulling together testimony for Appropriations.

The tricky part of testifying in Appropriations is finding the right balance. Appropriations is a fiscal committee. You need to talk about the fiscal impact of your bill. But you also need to talk about the policy in the bill, just don’t talk about policy too much – just enough to provide proper context. And you need to do that in two minutes or less. You have to find that Goldilocks balance with your testimony.

Their testimony went as well as it could go. AB 1784 is still on Suspense, but that’s the nature of having a bill that costs over $150,000. And because they have a bill that costs a decent chunk of change – $4.75 million to be precise – Keri and Michelle launched a parallel effort to line up the funding for their bill through the budget process.

Fun fact about that – when you’re going through the budget process to get funding for a bill you cannot talk about the bill you’re trying to get funding for. You can essentially copy/paste your bill language into the budget request, you just can’t name the bill. So AB 1774 becomes foster care pilot program.

That request has led to two more hearings that Michelle and Keri have had to navigate, Budget Subcommittee hearings in both houses of the Legislature. They’ve completed both of those hearings and we’ll pick back up next week with the latest developments surrounding AB 1784.

Lobbying the Budget

There are some who are intimidated by the process of lobbying the budget. One theory as to why they’re intimidated is, put simply, that it contains numbers and people are intimidated by numbers. That’s just one theory. However, there are quite a few subtle and not so subtle differences between lobbying the budget and lobbying any other piece of legislation that can make the budget process seem more intimidating. Today’s podcast with veteran lobbyists Ray LeBov and Chris Micheli seeks to demystify that process.

There are two very important things to understand about the budget. First, remember that in some ways, the budget bill is a bill just like any other bill – but in some ways unlike any other bill. The other thing to keep in mind is why the budget is so important because it can do things to you and your client(s) or for you and your client(s).

We’ll go over the calendar for the budget here and leave the other topics Ray and Chris discuss for you to listen to. The first difference between lobbying the budget and lobbying legislation is the calendar. The budget does not run on the normal legislative calendar. The budget process starts right after beginning of the new fiscal year on July 1. There is a lot of behind the scenes work over the next six months culminating in the Governor’s budget proposal on January 10, which kicks off the legislative portion of budget lobbying.

After the Governor announces the budget proposal, it becomes two identical bills – one in the Assembly and one in the Senate – that begin to work their way through the California Legislature. The bills start in their respective house’s Budget Committee, and then the work on the budget gets divided up between the budget subcommittees which work on different issue area jurisdictions within the budget.

After the subcommittee process is completed, the budget bill goes back to the full Budget Committee, which essentially amends the recommended changes from the subcommittees into the budget bill. The next step in the legislative process is conference committee to reconcile differences between the Assembly and Senate versions of the budget. That said, they can make changes to the budget bill that were identical in the versions the two houses sent over in addition to reconciling differences between the two versions of the budget bill.

After conference committee come negotiations between the Big Three – the two Democratic leaders in the Legislature and the Governor – to negotiate any final changes to the budget. Then, by June 15, the budget is passed by the Legislature and sent to the Governor to be signed. The Governor has the final say on the budget and can either reduce, or completely line item veto, appropriations in the budget.

Misconception Monday – State Budget

Hello. This is Episode 8 of my Misconception Monday series. If this is your first time tuning in to these, you can listen to the previous episodes here.

Today’s podcast, just in time for the announcement of the Governor’s January budget proposal on Wednesday morning, will cover misconceptions about the State Budget. Some of the misconceptions that we will talk about in this podcast relate to the Governor’s May Revise, the federal and state fiscal years, trailer bills, and Budget Subcommittees.

Is the Legislature complying with Prop 25 when they pass budget trailer bills after the fact?

In this podcast, I take an in depth look at an interesting situation that played itself out this past legislative session. In September of this past session, legislators passed two “junior” budget bills and a few dozen accompanying trailer bills. But was doing so proper, or even legal? We’ll explore that, and the Constitutional issues at play in that question, in my podcast.

For more on this subject, you can read an article I’ve previously written in Capitol Weekly.

CORRECTION: An earlier version of the podcast and transcript, in one section, implied that appropriations in the budget bill were not subject to a 2/3 vote requirement prior to the passage of Prop. 25.