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House brief on unallotment: Pawlenty’s actions are a threat to democracy

The brief filed to the Minnesota Supreme Court today accuses the governor of using unallotment in unprecedented and unintended ways that run roughshod over the traditional balance of power.
Casey Selix: Updated: Kelliher, Pogemiller say sta

If Minnesota’s unallotment statute means what Gov. Tim Pawlenty says it means, Minnesota is dangerously close to one-man rule, a brief [PDF] to the Supreme Court on behalf of the Minnesota House of Representatives argues.

The brief filed with the court today doesn’t say that in so many words, but it comes close. For example:

“Stripped to its essentials, [Gov. Pawlenty’s] current construction of the unallotment statute is that the Legislature delegated to the Executive the power to reduce appropriations the Legislature had just enacted and the Governor had signed.  This cannot be the case, as it would allow the Executive complete power — well beyond the item veto — to make or modify laws.”

The brief accuses Pawlenty of using unallotment in unprecedented and unintended ways that run roughshod over the traditional balance of power between the executive and legislative branches in order to impose his policy preferences on taxing and spending matters and in near-total disregard of the policies preferred by the majority of the Legislature.

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This is the first of four briefs due today
Today was the deadline for the briefs responding to Pawlenty’s appeal to the Supreme Court to set aside a lower court ruling that Pawlenty exceeded his powers when he unalloted $2.5 billion dollars last July. The guv’s legal team has already briefed the issue along with two briefs from Pawlenty allies. Four briefs are expected today.

The chief plaintiff in the case is Mid-Minnesota Legal Services on behalf of the recipients of a program for poor, sick Minnesotans whose subsidy for dietary aid was unallotted. Their brief should surface later today, along with two other allied briefs.

But the first to become public is this one, written by David Lillehaug (DFL activist and a former U.S. attorney) and Lousene Hoppe of the Fredrikson & Byron Law Firm, technically on behalf of the Minnesota House of Representatives, but really on behalf of its DFL majority. Several Republican legislators sponsored an amicus brief on the other side of the case.

Because it is sponsored by the House, this brief may be especially relevant on issues of the proper balance of powers between the branches of the state government. The brief concentrates on those issues, and it is fueled by thinly concealed outrage.

The background
With apologies to those who already know the basics of the case, let me walk through the background and the events of the 2009 session and its aftermath — as presented in this brief:

It’s supposed to be the job of the Legislature to make the laws, including the budget, and the job of the governor to execute them. The governor’s power to veto bills and to line-item veto appropriations within bills gives him substantial leverage over the budget-making process. The budget must be balanced within the biennium (but, of course, no one can be sure precisely how much money the state tax code will bring in during the biennium).

The Legislature and the governor are supposed to agree on a balanced budget at the beginning of the biennium. In 1939, the Legislature enacted a law that authorized the governor, in a situation of unanticipated revenue shortfalls, to first use up the budget reserves and then, if the unanticipated shortfall creates a likelihood that the state will run out of money during the remainder of the biennium, to reduce the planned allotments within individual programs to prevent the state from running out of money and having to shut down.

According to this brief, the language in the statute (see subdivision 4) about revenues being “less than anticipated” means less than anticipated at the time the Legislature and the governor agreed on a balanced budget. And the phrase “the amount available for the remainder of the biennium will be less than needed” implies that this is a power that becomes available later in the biennium based on a revenue shortfall that becomes known later in the biennium.

(The governor’s brief argues that if that was what the 1939 Legislature meant, it could have said so. The court’s job is to apply the words in the statute, not try to imagine the intent behind them.)

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The unallotment power was used four times before 2009 (two of those four were also by Pawlenty). In every previous case, the amounts unallotted were much smaller than the $2.5 billion of 2009, the unallotments affected only the second half of the biennium, the unallotments were decided upon after the governor and the Legislature had agreed upon a balanced budget, which then fell out of balance as a result of an unanticipated downturn in revenue collections after the Legislature had adjourned. (The dates and amount of all of the unallotments are on page 10 of the brief.)

In 2009, the session began with clear differences in policy preferences between Pawlenty and the DFL majority in the Legislature. Because of the bad economy, the state budget faced a big deficit unless taxes were raised, spending was cut or some combination thereof. Pawlenty was determined to avoid any tax increases. The Legislature preferred a combination of tax increases and spending cuts.

At the end of the session, the Legislature passed appropriations that, in total, would have been more than anticipated revenues under existing law, but also passed a revenue bill that raised taxes to achieve balance, based on then-current revenue projections.

Pawlenty signed the appropriations bill, used his line-item veto power to reduce them somewhat, then vetoed the revenue bill and immediately announced that he would use his unallotment  power to cut another $2.5 billion in order to balance the budget without raising taxes.

Unprecedented? Unanticipated?
This was the biggest unallotment in Minnesota history (by a factor of almost tenfold), but it was also unprecedented in its timing (the first time unallotment had ever been used at the beginning of a biennium, and the first time it was used to deal with a projected decline in revenue that occurred while the Legislature was still in session and that the Legislature had attempted to address with a tax increase). Says the brief:

“Appellants [Pawlenty’s side] argue that the unallotments were authorized by statute and necessary to address a massive, unanticipated budget crisis.  However, the facts show that the revenue shortfall was fully anticipated. The shortfall existed because the Executive decided to veto a revenue bill but not call back the Legislature.”

The brief also goes to some lengths to demonstrate that Pawlenty used unallotments to impose his own policy choices, which were reflected in the proposed budget that he gave to the Legislature at the beginning of the session, and in a number of cases, Pawlenty went beyond just changing the dollar amounts in the appropriations bills but changed formuli that were written into the law by the Legislature. In some cases, he used unallotment to impose precise changes that he had proposed to the Legislature but had been rejected. For example:

“Tellingly, the unallotments coincided with the Governor’s budget priorities unveiled in January and March 2009, rather than the Legislature’s priorities enacted in the appropriations bills which the Governor signed. For example, the Governor’s proposed budget recommended that statutory percentage of rent constituting property taxes be reduced from 19 percent to 15 percent. The Legislature considered this recommendation and decided not to enact it. Shortly after the Legislature adjourned, and using unallotment, the Executive rewrote the renter’s credit formula to accomplish what he could not otherwise achieve. This unprecedented approach to unallotment is a dramatic expansion of Executive power.”

The House brief also directly addressed one of the strongest arguments that Team Pawlenty had made in the previous round of briefs. The governor, without questions, has the power to veto a tax bill with which he disagrees, the guv’s brief argued. He is never required to call a special session of the Legislature. So if he doesn’t have the power to unallot, the alternative would be to keep spending until the state ran out of money then shut down the government. Here’s how the House brief responded:

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“Appellants [that’s Pawlenty’s side] appear to blame Respondents [that’s the plaintiffs in the case who are challenging the unallotments] and the District Court [that’s Judge Kathleen Gearin, who ruled that Pawlenty exceeded his powers] for increasing the potential of a government shutdown. But they are not the ones who vetoed the bill that would have balanced the budget, and they are not the ones who refused to call back the Legislature. The real consequences of Appellants’ construction of the statute would be unprecedented, unchecked Executive power to make law and reorder legislative priorities: a genuine threat to basic democratic principles.”

And here’s a final summary, from the brief, of the argument:

“Disagreement between the Executive and the Legislature is inherent in our system of separated powers. But the Minnesota Constitution also provides the tools to resolve budget disagreements by the end of the biennium. It provides for annual legislative sessions and gives the Governor authority to call special sessions. It requires the Governor to execute faithfully duly enacted appropriations laws. If the departments are at an impasse, they may appeal to the people during elections held sixteen months into the biennium. The Constitution presumes that the Legislature and the Executive will abide by their constitutional duty to reach agreement and balance the budget by the end of this biennium. The constitutional process must be allowed to work.”

I hope to have the other briefs later today or tomorrow and will try to summarize whatever new arguments they evince (if evince is the word I want here).