Shutdown suit reveals rift between Dayton and Swanson over constitutional issue

Attorney General Lori Swanson
Attorney General Lori Swanson

If the big deal stays on track to end the shutdown, it would be easy to shrug off the awkward constitutional problems raised by the now-customary arrangement for running much of the state government with unappropriated funds when the normal budget process fails.

But the case that challenges that arrangement is still alive in the Minnesota Supreme Court. Briefs filed Monday made clearer than ever a rift between Gov. Mark Dayton and Attorney General Lori Swanson over the constitutional question.

Although Dayton and Swanson are fellow DFLers, and are sort of on the same side of the case, Dayton’s brief attacks the Swanson legal position fairly harshly.

The Supreme Court agreed on July 11 to hear the case, brought by six Republican legislators, challenging whether the judicial branch has constitutional authority to take over the budgeting function when the other two branches deadlock.

Now, with a deal pending to end the impasse, the Supremes could change their minds and declare the issue moot. Erick Kaardal, the attorney for the legislators and the legal force behind the challenge, keeps making the argument that since we have entered an era of shutdowns that are frequent but brief, the Supremes ought to decide the case so we will know in advance of the next shutdown just what the state Constitution permits, what it bars and what it requires when the governor and the Legislature stalemate over the budget.

Background: The state Constitution (Article XI, section 1) says flatly that no state money can be spent without an appropriation. But during the brief shutdown of 2005 and the current one, the attorney general has persuaded a court to step in and decide which state government functions are so vital that they must continue without appropriations.

This year, Ramsey County District Court Chief Judge Katherine Gearin agreed with Swanson that the courts must decide which state functions continue during a shutdown. Gearin’s orders permitted most state money to keep flowing although most state employees were laid off.

Kaardal’s clients argue for a much narrower list of functions that can stay open.

The practical argument is that if shutdowns were inconvenient, perhaps they would be shorter and less frequent. But the constitutional argument is that there is simply no constitutional authority for the judicial branch to exercise the power of the purse — a power that the Constitution assigns to the Legislature, subject to the agreement of the governor or to the Legislature’s ability to override a veto.

The attorney general’s brief
In the previous shutdown (2005), and the other recent  near-shutdown (2001) and again this year, the attorney general has made the argument that the courts must exercise this power for two main reasons: one practical and the other rooted in the balance of powers across branches of government. The argument, made most recently in Monday’s brief from the attorney general, repeats these main points from the earlier petition asking Gearin to get involved:

Practical: Surely the state government — which the Constitution says in its opening line “is instituted for the security, benefit and protection of the people” — can’t possibly provide that protection and benefit if the state government must close the prisons and let the inmates loose or close the state mental institutions and turn out in the streets people who cannot care for themselves just because the governor and the Legislature can’t agree on a budget. Monday’s brief repeats a parade of horrible that would ensue if the entire state government suddenly ceased.

Constitutional: How can powers among the branches be balanced if one of the branches (the Legislature, by virtue of the power of the purse) can deprive the other two branches of the ability to perform even their most critical core functions by refusing to appropriate funds.

Precedent: In a 1986 case (Mattson v. Kiedrowski), the Supreme Court ruled that the Legislature cannot use its power of the purse to prevent a constitutional officer (in that case it was the office of state treasurer, which no longer exists) from performing his “core functions” by taking away most of his budget and transferring his functions out of his office.

Quoting from the Mattson ruling, the AG’s brief summarizes the argument thusly:

“The court stated that the designation of constitutional offices in Article V, Section 1, ‘implicitly places a limitation on the power of the legislature’ so that the core functions of the executive branch officers, and their performance of those functions, may not be abridged by a withholding of appropriations.”

Gov. Mark Dayton
MinnPost/James Nord
Gov. Mark Dayton

The Mattson case has become the linchpin of the shutdown arguments suggesting that a budgetary impasse amounts to the Legislature — by failing to pass a budget — shutting down the executive branch.

The solution, in 2005 and again this year, has been for the court to identify the “core functions” of each constitutional office and authorize the use of unappropriated funds to keep those functions going.

I should note that there are other categories of spending during a shutdown that are accepted by all the parties in the case. For example, some functions of state government are necessary in order to assure Minnesotan rights that are guaranteed under the federal or state constitutions. Some state spending is necessary to comply with the “supremacy clause” of the U.S. Constitution. And some state functions are fortunate to have laws on the books that guarantee their continued funding under a sort of permanent appropriation.

The Republican legislators accept these categories as well. But Kaardal doesn’t accept the “core functions” bit. If the Supreme Court sticks with the case to a conclusion, one of the biggest elements of a ruling would be to decide whether to extend the analogy from Mattson case — where the Legislature did set out to expressly transfer functions and funds from the treasurer’s office — to the case of a general collapse of the appropriation process is applicable.

The governor’s brief
Ironically, in 2005, when Mike Hatch was attorney general and Tim Pawlenty was governor, the two offices took almost identical legal positions heading into the shutdown, despite the partisan differences and personal rivalry between Hatch and Pawlenty, who would run against each other in 2006.

But since the shutdown of 2011 emerged as a likelihood, there are have always been differences between Dayton’s and Swanson’s legal approach. The new briefs draw them more sharply than ever.

For starters, the governor and his special counsel for shutdown legal questions, former U.S. Attorney David Lillehaug, have asked the court not to get involved in ordering funding for executive branch functions.

Dayton asserts that, as governor, he has certain “inherent powers,” not explicitly spelled out in the Constitution but necessary for him to fulfill his portion of the constitutional goal of providing for the “security, benefit and protection of the people.” Under these powers and without any input from the courts, he was prepared to “circumspectly” use those powers to continue functions to protect life, health, safety and property and to try to shield the Minnesota economy from major harm.

Therefore, Dayton argues, the attorney general should not even have gone to court in June to dust off the arrangement that had been used in 2005. And the court should not have taken the case.

In light of the new brief, it appears that the governor and Lillehaug agree with many key elements of the argument made by the six Repub legislators and Kaardal.

At times, the governor’s brief borders on accusing the attorney general of legal incompetence, of filing a kind of non-lawsuit lawsuit that didn’t make any “claims” against any adverse parties, didn’t “seek any of the ancient writs” that litigants usually seek from the courts, and did not present the court with “the type of dispute that the courts are designed and suited to handle…”

What should have happened, according to the governor’s brief, is that the court should have done nothing until the shutdown began. The governor would then have used his inherent powers to protect life and health etc. Someone who actually claimed to be harmed by what the governor was doing could have brought a lawsuit and then the courts would have had a proper courtly role to play in deciding what the laws and constitution of Minnesota require in such a situation.

The attorney general’s “broad invitation to the district court” to take over the budget decision-making functions during the shutdown was indeed “inconsistent with the separation of powers,” wrote Lillehaug.

Although the decisions by Judge Gearin and by Special Master Kathleen Blatz were “well-intentioned,” they usurped of the budgetary powers that the Constitution assigns to the other branches.

Dayton rejects Swanson’s use of and Gearin’s embrace of the Mattson case to justify turning the court into a budgeter of last resort. The Mattson case was all about forcing the Legislature to respect the constitutional separation of powers but Swanson used it to “invite the district court to go beyond the judicial department’s inhreent powers and exercise the inherent powers of the other two departments.”

From the governor’s brief:

“Mattson supports the governor’s position that the Legislative department, by a failure to enact appropriations, may not strangle the executive department. However, Mattson does not stand for the proposition that the Judicial department may take control of all executive agencies and their funding.

“…Thus Mattson is not solid precedent for the District Court to take control of the executive agencies’ services and the state treasury. [Gearin’s] June 29 Order did, indeed, take from the Legislative and Executive departments the shared power of the purse. It also took from the executive department a significant part of its powers to protect itself and to execute the laws. Each order of the District Court after July 1 took more power from the executive department.”

I believe the next step in the case will be a reply brief from Kaardal on behalf of the six legislators. That is due Friday.

By the way, the legislators who petitioned the court consider this constitutuional shutdown issue are: state Sens. Warren Limmer, Scott Newman, Sean Nienow and Roger Chamberlain, plus state Reps. Glenn Gruenhagen and Ernest Leidiger.

If you want to read the briefs, Swanson’s is here. Dayton’s is here. (It seems to take a few extra seconds for them to download.)

There is a third brief, by the League of Cities seeking to intervene and to get the court to agree that Local Government Aid is in the category that must be continued in any shutdown. That one is here.

Comments (5)

  1. Submitted by Claire Lundgren on 07/19/2011 - 11:31 am.

    Way over the heads of most of us who don’t speak “legalese” but I do agree that this should not be dropped as moot. With all the troubles of the past 20 days, it might be good to be prepared if the situation arises again. It also might be a deterant to another future shutdown. If the case advances it will make for some interesting reading. I hope my old brain is up to the legal gymnastics.

  2. Submitted by Richard Pecar on 07/19/2011 - 12:18 pm.

    In my opinion, Governor Dayton is spot on; as Chief Executive of Minnesota, and during a crisis, there is no logical way one can argue any other branch has the an “inherent power” to provide for “security and protection of Minnesotans”. End of story.

    However, a fella has to like the style of Judge Gearin. She whipped out the sword of truth and fair-play, and sliced off big chucks of dough from out of nowhere and protected those who needed it most. Kudos for her leadership. And, I believe if this mess lasted any longer, and the number of affected grew bigger, then Judge Gearin would have cast a larger net of protection. I have always said, in for a nickel, in for a dollar, what’s the difference? The can only hang you once.

    And, let’s face it, when the Judge acted to “protect” at-risk Minnesotans, and aside from this being pure leadership; we also need to face the fact she did this by usurping the powers of both the executive and the legislative branches.

    I can’t help wonder if the new budget bill includes language retroactively authorizing the appropriations made under Judge Gearin’s ruling?

    And by the way, once a political frenzy starts, there’s no calling an end to it; so, player like the legislature not to be outdone by a mere Judge, kept their paychecks going without passing a law appropriating the money. So, they too, abrogated their own powers as members of Minnesota’s legislative body by acting outside the law by paying themselves. And, they, too, usurped the governor’s powers. They should ordered to return their paychecks and per diem…with interest.

    The attorney general would do far more good for the people of Minnesota, if her office started regulating non-profits, which is clearly required under Minnesota Statute, and she can start with the townhome associations. The AG should leave practicing the law to the professionals, the Minnesotans who break the law, like the ones who write and judge it.

    The Supremes have a lot to chew on, I will pray they decide soon. I am hopeful they put this one to bed for once and all and don’t pass the buck. Otherwise, it will rise up from the ashes.

  3. Submitted by Peter Nickitas on 07/19/2011 - 01:12 pm.

    Where does the money come from to keep “core activities” going by order of the special master?

    Have you ever thought of that?

    I see this budget shutdown as a prime opportunity to examine the Comprehensive Annual Financial Report (CAFR) of the state of Minnesota. The CAFR details all assets and income, from whatever source derived, of the state. This includes pension plans, State Investment Board holdings, monies coming from grants to the University or state agencies, and any other income generating activities. Perhaps one may find that these assets and income sources make many taxes superfluous and unnecessary.

    One must examine the “investment return” from the specialty advance forward investment funds from the enterprise operations and other special liability funds that are kept separate from the general purpose operating revenue (the budget) to get the answer.

    The answer may make a very interesting amicus brief, as well as political organizing and educational tool.

  4. Submitted by Ray Schoch on 07/19/2011 - 03:25 pm.

    Good piece, Eric. I’m not a lawyer, nor do I play one on TV, but I’ll be very interested, nonetheless, in the outcome of these cases before the court.

    As a Minneapolis resident, I’m more than casually interested in case #3, as well.

    While the value of my home continues to decline in more or less inverse proportion to the property taxes levied upon it, I’m especially peeved at rural Republican legislators who think it’s OK to hold as fiscal hostages the urban areas of the state that drive the economy. Many others more knowledgeable than I have already said that Minneapolis, St. Paul, and Duluth pump far more dollars into the state’s coffers than they get back out in the form of LGA, and if the original purpose of said LGA funding was to ensure that small towns in those same rural areas had a little money with which to try to keep up with social and technological changes in the society, those rural legislators are shooting their own neighbors in the foot.

    Combined with threats to mass transit, cutting LGA funding reveals a hostility to urban areas among some legislators that’s plain stupid. In the long run, it will be at least as detrimental to the state and its citizens as the hostility displayed, often by the same people, to public education.

  5. Submitted by Claire Lundgren on 07/20/2011 - 09:46 pm.

    #2: Very interesting comments. Makes me realize the significance of why Dayton’s attorneys were present at Gearin’s hearings. I hope you will keep up with the case as it progresses. I think, for me, you were able to break it down so I could follow the different areas in question. I will take special care to see how you and Mr. Black take it all apart. Thanks!

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