Full video of the Minnesota Supreme Court unallotment oral arguments, courtesy of The UpTake.
The Minnesota Supreme Court roughed up Gov. Tim Pawlenty’s side in the unallotment case Monday morning.
In deference to the importance of the case the court allowed the arguments to run half an hour over the allotted time. The oral arguments are the last public step before the justices will rule in the case. (By tradition, they don’t even begin to discuss it among themselves until after the arguments. After the oral arguments adjourned at 10:30 a.m., they retreated from the public chamber to begin doing so.) There is no way to speculate intelligently on when they will rule.
As far as how they will rule, they left behind plenty of clues. It would be foolish to infer how they are going to rule based on the questions they asked at oral arguments, but it would also be willful blindness not to notice which side got the tougher questions, including from Chief Justice Eric Magnuson, who took the lead in the questioning all morning.
Magnuson interrupted Pawlenty’s counsel, Patrick Robben, a few seconds after Robben started talking. Magnuson asked whether the unallotment statute should be viewed as a delegation of the Legislature’s appropriation power or a codification of the governor’s power to spend the money appropriated by the Legislature. It turned out to be the top question on Magnuson’s mind and he asked it of all three lawyers who spoke. Robben, who may not have anticipated the question, said it was a delegation of authority.
Why does this matter? Appropriating state funds is a purely legislative power. It cannot be delegated to another branch of the government, and if the Legislature did delegate it in the unallotment statute, then the statute is probably unconstitutional. (Magnuson didn’t say that, but it seems to follow.)
When his turn came, Solicitor General Alan Gilbert (Robben’s co-counsel on the Pawlenty side of the case) got the same question, and he fudged, perhaps trying to fix Robben’s answer. Gilbert took neither of the choices Magnuson offered him. He said the unallotment statute did not delegate appropriation power but delegated authority to the governor for the purpose of preventing a fiscal crisis and balancing the budget.
Magnuson’s second question, related to the first, was perhaps the key to the discussion of the entire morning: What obligation did the governor have, when unallotting, to carry out the intent of the Legislature when it enacted the appropriations?
If you want to understand the case, you need to think about that one. Magnuson and Justice Paul Anderson raised it several times in various forms. As Anderson phrased it (I believe he was borrowing this language from a previous court ruling), when the Legislature passes appropriation bills, it is deciding which policies are “worthy of pursuit and priority.”
The governor’s job is to implement those decisions through the spending power. But if unallotment gives the governor the power to delete funding from some programs, and even eliminate funding for entire programs, while leaving others untouched, then the governor can — and in 2009 arguably did — substitute his judgment for the Legislature’s about which policies are worth pursuing and funding.
The plaintiffs in this particular lawsuit are recipients of a state subsidy for people who are both poor and sick and who have doctor-certified needs for particular diets to preserve their health. In his unallotments last year, Pawlenty deleted all funding for those subsidies, effective last November. (The program’s funding was preserved, at least temporarily, by the lower court ruling that Pawlenty’s unallotment had exceeded his authority. That ruling led to the appeal by Pawlenty and Monday’s arguments.)
In a case like the dietary unallotment, a program that the Legislature deemed worthy of funding, was not just modified. It was eliminated. Such instances, Magnuson said, amount to the “complete elimination” of one of the Legislature’s judgments about “who should get what and when.”
If the governor’s only role as an unallotter was to square the spending bills with a new, unexpectedly lower level of revenues, and if he wanted to do it in a way that respected the Legislature’s priorities, he could, for example, cut every appropriation 10 percent across the board, Magnuson hypothesized. But Pawlenty didn’t do that. He exercised what Magnuson called “subjective judgments” that substituted his spending priorities for the Legislature’s. “He said, ‘I’m picking this and I’m not picking this,’” Magnuson paraphrased.
In doing so, said Justice Helen Meyer, the governor “by definition, [is] not giving full effect to a law passed by the Legislature.” Instead, the governor is “deciding which laws to give full effect to.”
Meyer constructed a hypothetical to ask the Pawlenty legal team whether there was any limit to the governor’s discretion over funding decisions. Suppose the whole budget was $100 and was divided into equal thirds between education, transportation and public safety spending. Suppose halfway through the biennium a 9/11 type event occurred that caused a truly unanticipated shortfall in state revenue, let’s say cutting state revenue in half, and triggering the governor’s unallotment power. Is the governor’s discretion so great that he could zero out the school budgets entirely in order to preserve as much as possible in the other two spending categories?
Gilbert said that yes, in theory, the governor could do that.
Justice Alan Page, who spoke seldom Monday but whose questions were all tough on the Pawlenty side, asked whether there was anything in the unallotment statute or anywhere else that would prevent the governor from encroaching on the power of the Legislature.
Justice Lorie Gildea, who came across Monday as perhaps the justice most favorable to the Pawlenty side of the case, said that there were at least some standards in the law to guide the governor.
Gildea offered, in a sense, her own answer to Magnuson’s opening question. Unallotment occurs in an area between appropriating and spending, she said, an area that is neither a completely Legislature nor a completely executive function.
How to decide the case?
The Supremes will decide the case either on a statutory or a constitutional basis, or perhaps one can imagine some combination thereof. If the problem is that the statute transfers legislative authority to the executive branch and doesn’t provide enough guidance to prevent him from essentially making new laws, that seems to be a constitutional defect in the law that could cause it to be struck down.
But several justices warned that the court always starts such an analysis assuming that a statute is constitutional.
If the court decides the question on a statutory basis, Monday’s arguments suggested, it will revolve around the word “anticipated” in the statute.
The statute says that the unallotment power is triggered by a finding that state revenues will be “less than anticipated.” In 2009, the February revenue forecast showed a big drop in revenues and a big deficit ahead, but that was in February, before the Legislature had made its budget. Pawlenty had the benefit of that forecast in preparing his own budget. The anti-unallotment side of the case argues that unallotments announced in May, as the Legislature was adjourning, cannot be deemed unanticipated if the projected revenue shortfall has been known since February.
The Pawlenty side has argued that a continuing decline of the state revenue picture after February — although it wasn’t contained in a full-fledged new forecast — was enough to trigger the unallotment power.
But Justice Paul Anderson pointed out that the $2.7 billion Pawlenty unallotted in May was the same amount he would have unallotted if he had relied on the February forecast. Magnuson added that in February, the official forecast called for the state to collect $30.7 billion in revenues for the biennium, and in May, when Pawlenty announced his unallotments, the forecast still called for $30.7 billion. So, for some of the justices, it would seem to be possible that they could rule that the statute is constitutional but that Pawlenty violated it by unallotting without having an unanticipated shortfall to trigger the power.
The anti-unallotment lawyer
When the turn came for Galen Robinson, the legal aid lawyer representing the dietary supplement recipients (and therefore the lawyer for the anti-unallotment side), the justices asked whether he was fundamentally making a constitutional or a statutory argument. As he has from the beginning, he declined to make a clear choice, saying that Pawlenty’s 2009 unallotments were unconstitutional. If those complied with the statute, then the statute must be unconstitutional. If those violated the statute, then they can be invalidated on statutory grounds and perhaps the statute is constitutional.
Justice Christopher Dietzen, whose questions were generally more sympathetic to the Pawlenty side’s arguments, took on the “unanticipated” problem, asking Robinson whether economic forecasting is such a complex and technical task that the court must defer to the governor’s chief of budgetary matters to decide whether revenue is declining in between official forecasts.
Robinson said no, the Pawlenty administration should have waited for the next official forecasts in November of 2009 and February of 2010, and if those had shown a new shortfall, the administration could address those shortfalls with the 2010 Legislature.
Magnuson asked what obligation did the governor have to keep spending according to the appropriation bills even if it became clear that he was “spending the state into deficit.” Robinson said the only real requirement is to balance the budget by the end of the biennium, which could be in the legislative session in the second year of the biennium.
Magnuson mused that it might not be wise to keep writing checks against an empty checkbook.
Solicitor General Gilbert also cautioned the court that it was wading into a political issue. This is a reference to the “political question” doctrine, according to which the courts should not interfere in fights between the more political executive and legislative branches, but should allow those branches to fight it out or leave it for the voters to decide in future elections.
Magnuson was downright dismissive of that warning, saying the political issue “doesn’t concern me.” The voters will certainly decide some of these issues going forward, but the court is left to decide the retrospective question of the 2009 unallotments.