Democratic legislative leaders sued Controller John Chiang today for blocking their pay during last year's budget dispute, a decision that drew scorn from lawmakers last summer.

Senate President Pro Tem Darrell Steinberg and Assembly Speaker John A. Pérez said the Democratic controller overstepped his bounds when he said legislators sent Gov. Jerry Brown a flawed budget last June and docked their pay. They did not sue for back earnings, but to ask the court whether Chiang can intervene this year if lawmakers face another budget dispute with Brown at the June 15 deadline.

The lawmakers hired as representation Arthur G. Scotland, retired presiding justice of the 3rd District Court of Appeal, as well as the Los Angeles firm Strumwasser & Woocher. The Legislature's operating budget, financed by tax dollars, will pay for legal costs.

Chiang said his own party's lawmakers failed to balance the budget largely because their plan underfunded schools by $1.3 billion according to his interpretation of the state constitution. He also said they failed to pass all of the bills necessary to carry out a balanced budget. Chiang's decision came after Brown vetoed the first budget lawmakers sent him at the deadline.

Under a 2010 voter-approved law, lawmakers lose their pay and tax-free expense money if they do not send the governor a balanced budget by the June 15 deadline. Democrats added that provision as a sweetener in Proposition 25, the main thrust of which was reducing the budget vote threshold to a majority, rather than two-thirds. The controller believes he has discretion to determine what counts as a balanced budget under the initiative.

Steinberg and Pérez believe the controller has no role under Proposition 25 to determine the validity of the Legislature's budget. Scotland said today the controller illegally interfered with the Legislature's powers of appropriation.

Aside from veto powers, Steinberg said "neither the governor nor any member of the executive branch may brandish the threat of withholding legislative pay because they disagree with the decisions made by the legislative branch."

Brown and lawmakers ultimately reached agreement on June 27, costing lawmakers about $4,830 each, equal to 12 days' worth of pay and expense money.

Mindful of public acrimony against the Legislature, the two leaders emphasized Tuesday that they were not asking for back pay. "Let me be clear from the outset, both the pro tem and I have waived our claims for renumeration should this lawsuit succeed," Pérez said. "This is fundamentally an issue of separation of powers."

Chiang's move gave Brown leverage in budget negotiations, as the controller essentially suggested that Brown could block legislative pay with his veto pen. Lawmakers have seethed ever since. If their lawsuit succeeds, they would not only have greater pay protection this year, but also greater leverage. Brown has asked lawmakers to pass significant cuts to health and welfare programs and to put school funding at risk if voters reject his tax plan.

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