Notes From Babel

Archive for the ‘Law’ Category

Judge Vinson’s Extra-Judicial Order in the Individual Mandate Lawsuit

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Orin Kerr reports that Judge Vinson, the federal judge who recently ruled ObamaCare’s individual mandate was unconstitutional, ruled on the DOJ’s motion seeking clarification of whether the court had meant to enjoin the Obama administration from rolling out ObamaCare pending appeals.  In granting the DOJ’s motion for clarification—clarifying that it did prevent the administration from enforcing the Act—the court also unexpectedly ruled:

To the extent that motion is construed as a motion to stay, it is also GRANTED, and the summary declaratory judgment entered in this case is STAYED pending appeal, conditioned upon the defendants filing their notice of appeal within seven (7) calendar days of this order and seeking an expedited appellate review.

What does this mean?  Basically, it means Judge Vinson is tweaking the DOJ’s appellate strategy and applicable procedural rules.  As Kerr notes, the ruling forces the DOJ to choose whether to “wait seven days, let the stay order lapse, then immediately seek a stay in the Court of Appeals,” or “go to the Court of Appeals now and seek an amendment to the stay order.”  (Apparently the DOJ has chosen the latter.)

But all this is surprising—and improper—because the DOJ did not move for a stay.  As Judge Vinson’s ruling itself noted, the Florida attorney general argued in its opposition to the motion for clarification that “[i]f the Government was not prepared to comply with the Court’s judgment, the proper and respectful course would have been to seek an immediate stay, not an untimely and unorthodox motion to clarify.”  Obviously, then, the opposing party understood the DOJ’s motion to be one for clarification only, not for a stay.

What this means is Judge Vinson order arguably violates procedure rules—including the really big procedural rule: the Fifth Amendment’s Due Process clause.  This is a problem because courts aren’t self-executing entities.  The nature of judicial power (as opposed to executive power or legislative power) is that it requires a claimant to first ask for relief before a court may act.  This is so for two basic reasons.  First, it is the nature of judicial power to decide only “cases” or “controversies.”  There can be no case or controversy until a claim or motion is formally brought before the court.  Second, there can be no due process unless all affected parties are notified of which of their interests may be impacted by the relief sought from the court, and given an opportunity to respond or oppose.

Here, both of these notions are undermined by Judge Vinson’s ruling.  As the ruling acknowledges:

The plaintiffs have asserted that the defendants’ motion to clarify is, “in fact, a transparent attempt, through the guise of seeking
clarification, to obtain a stay pending appeal.” See Pl. Resp. at 2. At certain parts in the pleading, the defendants’ motion does seem to be more of a motion to stay than a motion to clarify. Because the defendants have stated that they intend to file a subsequent motion to stay [Def. Mot. at 15] if I were to “clarify” that I had intended my declaratory judgment to have immediate injunction-like effect (which I
just did), I will save time in this time-is-of-the-essence case by treating the motion to clarify as one requesting a stay as well.

Simply put, whatever the true goals or motives of the DOJ as the moving party might have been, they are irrelevant if not plainly stated in the request for relief.  Time may be of the essence, but the rules of procedure provide mechanisms for immediate relief.  It is up to the parties to avail themselves of them.  Their failure to do so does not authorize the court to issue rulings beyond its jurisdiction.

[Update.  I failed to raise that Judge Vinson’s new ruling is also arguably a violation of the separation of powers doctrine to the extent it purports to trump the rules of appellate procedure.]

Written by Tim Kowal

March 4, 2011 at 12:00 am

Taxpayer victory in state employees pension lawsuit

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The same week the Second District ruled in favor of public sector unions in Orange County v. AOCDS, the Third District ruled against them in California Statewide Law Enforcement Ass’n. v. California Department of Personnel Administration on January 26 (opinion available here).  You can find my write-up on the Orange County case here.  (Full opinion here.)  While the two cases come to opposite conclusions, it is not for any disagreement about the law.  While the Orange County case raised important questions under the California Constitution, the CSLEA case involved the determination of whether the union’s retroactive pay increase had properly been put before and ratified by the California Legislature as required by statute.  Because the CSLEA court answered that question in the negative, the union lost.  While this may mean a savings for the state, this is a relatively unusual case that will not likely have wide application for other challenges to union deals.  Thus, all eyes are still on Orange County’s appeal to the California Supreme Court.

However, it is still interesting to observe the markedly different approach the Third District took toward the state’s state budget issues.  Note the gravity with which the court regards the case before it:

Many millions of dollars are at stake in this case.  At issue is the process by which a public employee labor union and the Governor negotiate benefits for state employees and then present their collective bargaining agreement to the Legislature for approval and funding.  Such agreements, which have been under the public’s radar in the past, are now coming to light due to the massive budget deficit the State is facing.

Compare this with the Second District’s aloof treatment in Orange County v. AOCDS:

In 2008, the County of Orange (Orange County or the County) sued the board of the County’s retirement plan, claiming that an enhanced retirement formula for prior years of service adopted in 2001 by the County Board of Supervisors violated the California Constitution. The County now appeals from the trial court’s grant of motions for judgment on the pleadings and entry of judgment in favor of the Association of Orange County Deputy Sheriffs and the Board of Retirement of the Orange County Employees’ Retirement System. We conclude that the past service portion of the enhanced retirement formula does not violate the Constitution, and we affirm.

The facts in CSLEA v. CDPA were these:  The CSLEA represents State Bargaining Unit 7, comprised of approximately 7,000 state employees.  Half of that unit is made up of sworn peace officers.  The other half are DMV officers and regulatory agents who inspect and investigate auto dealerships, cosmetologists, hair salons, etc.  California collective bargaining law provides for an enhanced pension benefits for what’s called “safety members”—i.e., law enforcement officers whose jobs carry a risk of injury.  Peace officers, firefighters, and correctional officers are considered “safety members” under California law.  See, e.g., Cal. Gov. Code §§ 20390(a), 20398(a)(10), 20403.  Other state employees are “miscellaneous members” who are not entitled to the same generous retirement formula reserved for safety members.  Obviously, then, miscellaneous members jockey for safety member status. 

In March 2002, they were successful.  At that time, CSLEA prevailed upon the DPA to reclassify the employees of Unit 7 from miscellaneous member status to safety member status, thus increasing their pension benefits.  The parties apparently agreed that the members’ status was to be made retroactive to their prior years of work—causing the state to immediately incur a “present value cost” liability of more than $148 million.  However, the memorandum of understanding actually presented to the Legislature for approval did not indicate this retroactivity agreement.  On that basis, the court held “we cannot say that the Legislature approved the unwritten agreement to bestow the safety member benefits retroactively.” 

California’s statewide unfunded public employee liability is estimated between $400 to 500 billion.  According to the American Enterprise Institute, those pensions are approximately 48% funded.  At Cal Watchdog, Larry Ebenstein of the California Center for Public Policy in Santa Barbara writes:

There are already more than 12,000 retired public employees in California with annual pensions of $100,000 or more. This number will increase substantially in the years ahead. Looking forward 20 years, California will have 2 million retired public employees drawing average pensions of $50,000 — $100 billion per year in pension costs when the entire state budget is now merely $85 billion.

. . . .

President Franklin Roosevelt was clear that there is a great distinction between public and private sector unions: “Meticulous attention should be paid to the special relations and obligations of public servants to the public itself and to the government,” he said in 1937. “The process of collective bargaining, as usually understood, cannot be transplanted into the public service.”

George Meany, the first and longtime president of the AFL-CIO, had the same view.

Public sector unions have negotiated approximately $8 billion in unconstitutional retroactive benefits.  These two lawsuits represent a handful of our representatives paying “meticulous attention” to the improper bargains public employees are awarded. 

Written by Tim Kowal

February 15, 2011 at 11:00 pm

The Bill of Pleasures

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E.D. Kain thinks the right to own advanced small arms is “silly.”  True, most people who use advanced small arms do so for pretty trivial and even gratuitous things, like shooting soda cans in rapid succession.  Even hunting, perhaps necessary for personal survival at some points in U.S. history, is properly regarded as mere pleasure or sport than the sort of fundamental liberty that we enshrine in a constitution.  When you come right down to it, Americans haven’t had the need to use guns for the true purpose the Second Amendment contemplated since, ever, basically.  As E.D. concludes:

I think it’s a lot more about pleasure than about liberty in cases like this.  Nobody needs a thirty-round magazine. But it’s a lot of fun to fire off that many shots without reloading.

But I think this betrays a certain presumption—fundamentally disputed by many, including me—that we ought to assume the perpetual continued peaceful coexistence of government and free individuals.  The right to bear arms, like the other rights in the Constitution, was not put there idly. The reason any individual right or government limitation is inserted into a constitution rather than a mere legislative enactment is as much for structural reasons as it is for the sheer gratuitous pleasure of exercising liberty.

Our Founders did not take for granted, as we do today, the stability of our political order. We don’t continue to honor the Second Amendment to protect a liberty interest in cutting down soda cans. We honor it because it is absolutely essential to the galvanizing idea underlying our political order: that our government serves by and through the people’s consent, and no version of that government could ever be deemed to have the power to strip the people of their means to exit that political order upon [the people’s] declaration of a long train of violations of their natural rights.

Again, our Constitution was not based upon the presupposition that E.D. appears to hold—i.e., that there is no longer cause to reserve a means of exit. If we want to give rise to this new assumption, we’d either need to convene a constitutional convention, or abandon the idea of operating under a written constitution.

[I posted in a rush, and forgot to come to the point.  Modern liberalism might be said to comprise two mutually reinforcing ideas:  (1) trusting government to organize human efforts to bring about greater pleasure, and (2) treating rights as mere “pleasures” that can be regulated by government.  Repeat as necessary.  I won’t say there’s nothing to be said for arguments upon these premises, only that these premises are not those upon which our Constitution is based.  Thus, there’s really no traction, within a framework that accepts these premises, in talking about whether arguments about the Second Amendment are “silly” or not.]

Written by Tim Kowal

February 10, 2011 at 8:26 pm

California’s Pension Crisis Takes Another Step Toward Populist Revolt as Courts Refuse to Help

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As I pointed out in an op-ed in the Sacramento Bee last year, one of the reasons runaway public employee pensions poses such a different problem is because California’s courts have steadfastly undone voters’ efforts to make it easier.  At least three provisions of the California Constitution, for example, make retroactive pension agreements void ab initio.  Yet, the Second District Court of Appeal out of Los Angeles last week brushed aside each of these important citizen taxpayer protections to side instead with the public employee union.  (Full opinion here.)  As I explain below, California taxpayers have done what they’re supposed to:  they enshrined prohibitions in their state constitution to avoid amassing large public debts.  It is instead our elected officials—such as Jerry Brown, who empowered public employees to unionize—and our judges who have failed our state.  Indeed, despite recently proposing an aggressive budget, Governor Brown still refuses to go after low-hanging fruit when it comes to pension reform.

The Court of Appeal’s recent blow to taxpayers and their constitutional protections thus takes California another step decidedly closer to a populist uprising that will lead us either to another wave of initiative amendments, or to revolt.

Basic Facts in Orange County v. Association of Orange County Deputy Sheriffs

The basic underlying facts of the Orange County pension case are straightforward.  The Orange County Board of Supervisors approved an amended AOCDS contract in December 2001 that increased union members’ pension from a “2% at 50” formula to a “3% at 50” formula.  This allowed members to receive on retirement the product of 3% of their last year’s salary, times their total number of years worked.  Thus, with the stroke of a pen, the County instantly accrued approximately $100 million of additional, unfunded pension liability.  This liability was based on years the union members had already worked, and they were required neither to make additional contributions nor to perform additional work in exchange for their 50% increase in pension benefits for those years.

The two provisions of the California Constitution at issue in the Orange County lawsuit are the prohibition on indebtedness and the prohibition on compensation for work already performed.  However, the Second District Court of Appeal refused to enforce either of these important constitutional limitations.  The court provided scarce rationale for its decision, instead relying on prior cases—which as previously explained, provided even less rationale for their decisions.

To understand the significance and the deliberateness of the court’s refusal to apply the law, a brief history of the three constitutional provisions will be helpful.

History and Purpose of California’s Prohibition on Debt and Retroactive Compensation

First, the debt limitation at article XVI, section 18 prohibits any state or local government from “incur[ring] any indebtedness or liability in any manner or for any purpose exceeding in any year the income and revenue provided for such year, without the assent of two-thirds of the voters of the public entity voting at an election to be held for that purpose.”  This basic restriction was included in the original state constitution in 1879 in consideration of the turnpike, canal, and railroad boom of the 1820s and ‘30s, the Panic of 1837, and the subsequent surge of tax increases adopted to pay state debts accrued during the boom.  Prior to 1840, no states had adopted constitutional debt limitations and, as a result, dangerous debts accumulated during the transportation boom of the first half of that century.  In New York, which had accumulated the highest debt in the nation (due in large part to financing the Erie Canal), the chair of the Constitutional Convention of 1846 warned: “unless some check was placed upon this dangerous power to contract debt, representative government could not long endure.”

The debt limitation was Californians’ response to the demonstrated problems facing local governance.  Nor were they alone.  Between 1840 and 1855, 19 states enacted constitutional debt limitations.  In New York, which had accumulated the highest debt in the nation (due in large part to financing the Erie Canal), the chair of the Constitutional Convention of 1846 warned: “unless some check was placed upon this dangerous power to contract debt, representative government could not long endure.”  Thus, to prevent another destructive cycle of hasty overinvestment—followed by decades of indebtedness—Californians have, from the moment of statehood, forced their municipalities to operate within their financial means.  As the California Supreme Court acknowledged in the 1896 case of McBean v. City of Fresno,

[T]he framers had in mind the great and ever-growing evil to which the municipalities of the state were subjected by the creation of a debt in one year, which debt was not, and was not expected to be, paid out of the revenues of that year, but was carried on into succeeding years, increasing like a rolling snowball as it went, until the burden of it became almost unbearable upon the taxpayers. It was to prevent this abuse that the constitutional provision was enacted.

Following a debate on whether and how much to cap municipal debt—e.g., at 2% or 5%—the idea of caps were ultimately abandoned in favor of submitting large public works proposals to the people for a two-thirds vote, along with a “sinking fund” for paying back the principal sum within twenty years of contracting the debt.

Second, the limitation on “extra compensation” at article XI, section 10 prohibits any local government from “grant[ing] extra compensation or extra allowance to a public officer, public employee, or contractor after service has been rendered or a contract has been entered into and performed in whole or in part . . . .”  Like the debt limitation, this prohibition also appeared in the 1879 Constitution in response to concerns about government officials exploiting their connections and influence to obtain increased compensation beyond the terms of their original contracts.  During the debates during the constitutional convention, it was expressed “[t]he trouble is not in regard to the salaries which the officers receive according to law, but as to the compensation which they receive outside of the law… [by] surreptitious methods.”  As another delegate explained:

what the people of San Francisco do want is not so much a reduction of salaries, but they want to know exactly what salary the officers are to receive. The trouble is not in regard to the salaries which the officers receive according to law, but as to the compensation which they receive outside of the law … it is this, uncertain amounts that come from commissions and other surreptitious methods whereby men get money for services not rendered. It is against these that the people rise up and cry out, and not against the regular, square, honest compensation of officers.

Later case law would cramp the constitutional ban on extra compensation by allowing charter cities to escape the ban.  Not amused, Californians in 1970 reaffirmed the prohibition by enacting the current article XI, section 10, explicitly applying the ban to all local governments and reversing prior cases holding otherwise.

The Court of Appeal’s Opinion

Though the language and purpose of these two constitutional provisions are straightforward, the court declined to enforce either of them.  The reasons provided, however, are far from satisfying.

With respect to the constitutional prohibition against incurring indebtedness, the court drew a distinction between “debt or liability,” on the one hand, and what the court refers to as “unfunded actuarial accrued liability”—better known as the $100 million of unfunded pension liability accrued the moment the County signed the 3% at 50 plan in 2001.  “Unfunded actuarial accrued liability,” the court held, is not a “debt.”  Instead, it is “an actuarial estimate projecting the impact of a change in a benefit plan.”

The County anticipated that linguistic machinations might be employed to escape the Constitution’s effect, and so offered that the definition of “indebtedness” as defined by the California Supreme Court “encompasses ‘obligations which are yet to become due as [well as] those which are already matured.’”  The court casually dismissed this authority, however, stating “[t]his unexceptional statement does not control our case.”  Instead, the court held that “[a]n unfunded liability such as a UAAL is not created at the time of the award of enhanced benefits, but occurs over years ‘and may have been avoided entirely if, for example, the retirement fund experienced better than expected investment returns….’”  Of course, this may be said about any debt that has not yet come due, as it may be discharged through accord and satisfaction, novation, forgiveness, etc.  To say this makes it other than a debt robs the word of any concretes to which it could ever apply, and nominates it for removal from our lexicon altogether.

Incidentally, yesterday I attended the annual Federalist Society Western Conference at the Reagan Library, where pension reform and this case were discussed.  When a panelist read the above quoted language from the decision making the empty distinction between “debt” and “an actuarial estimate projecting the impact of a change in a benefit plan,” the crowd of lawyers could not restrain a very loud groan.

With respect to the constitutional prohibition against extra compensation, the court was less creative.  California courts have elsewhere availed themselves of a Nuremberg Defense by citing other opinions that, without explanation, elevated pension rights to a class by itself.  However, even these cases did not stand for the proposition that Section 10—the prohibition against retroactive compensation—does not apply to pensions.  Yet, the court drew this inference anyway.

With some relief, the court explained it did not carry the burden to explain its conclusion that pensions, and only pensions, are entitled to exclusion from the important constitutional prohibition against extra compensation.  Instead, the court explained that “[i]f this creates an anomaly in the law, it is one sanctioned by the California Supreme Court.”  But this is not true.  While it is an anomaly, it was not sanctioned by the Supreme Court with respect to Section 10’s prohibition against extra compensation.  More importantly, that Supreme Court case, Miller v. California, only explains that pensions are simply another form of compensation for work previously done.  It does not lend any rationale to support to the proposition that extra pension may be paid by for work previously done.

Simply put, the court did not offer any analysis to explain its refusal to enforce the Constitution.  It merely cited other cases that conferred special status on pensions—also without any analysis for doing so.  Referring to prior cases in lieu of providing a rationale is an increasingly abused practice among judges, particularly in cases like the one here, in which those prior cases are equally empty of reason.  It is a problem Jonathan Swift described this way in Gulliver’s Travels:

It is a maxim among these lawyers that whatever has been done before, may legally be done again: and therefore they take special care to record all the decisions formerly made against common justice, and the general reason of mankind.  These, under the name of precedents, they produce as authorities to justify the most iniquitous opinions; and the judges never fail of directing accordingly.

The recent opinion in Orange County v. AOCDS is only the most recent installment in a line of pension cases that offer scant appeal to common justice and general reason, and instead seek to justify themselves merely by making reference to one another.

In closing, it is worth noting that the opinion was handed down just seven days after oral arguments on January 19.  Though I have not been able to find the transcript on the web, I am informed that the AOCDS attorney who presented oral argument before the court—herself a former court of appeal justice—pleaded with the panel something to the effect of “this case concerns pension plans just like yours and mine.”  This raises potential ethical issues and suggests the justices may have been required to recuse themselves, particularly if they are likewise beneficiaries of retroactive pensions.

Juries ruin pretty much everything

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Steve Bainbridge observes the fun being sucked out of America and fingers plaintiffs’ lawyers as the culprit.  I’m no apologist for the tort bar, but consider the problem from the incentives angle.  There’s billions of dollars to be had for talented, opportunistic attorneys.  It would take a level of self-control unprecedented in human history for them all to willingly leave all that money on the table.  Swapping lawyer jokes is cathartic, but it’s not getting us anywhere.

The time-honored jury of peers, on the other hand, is where we would expect some sobriety.  Jurors receive just enough to cover the cost of getting to and from the courthouse for each day they sit and listen to the aforementioned bloviating moneybags put on their expertly orchestrated dog and pony show.  They have no monetary incentive to help the plaintiffs’ bar suck the fun out of the world. Yet, they tend to go right along with the fun-sucking soulless bloviating plaintiffs’ attorneys.  Why?  Because they let themselves get swept up in anti-corporatist, redistributionist, populist notions of justice.  And, if it’s occurred to you this phenomenon might be self-fulfilling given the likely academic and economic disposition of the folks who have nothing else to do but sit through a weeks’-to-months’-long trial, you are probably using your head.

Thus, the better offhanded explanation for our sickeningly over-lawyered society might be the constitutional guarantee of a trial by jury.

Written by Tim Kowal

January 26, 2011 at 11:04 pm

Posted in Law

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Law, Society, and Shame

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My hometown of Huntington Beach is ranked top in the state of California for alcohol-related traffic deaths.  Recently, the city council considered putting repeat offenders on the HBPD’s Facebook site with the apparent hope of shaming them into sobriety.  (The council voted down the proposal last night.)  Though I was and still am ambivalent about the idea,* I was surprised by the hostility many expressed toward the proposal.  Several folks expressed the sentiment that the punishment for drunk driving, or any crime for that matter, is dictated by the penal code, and cities may not add more than what the law already provides.  This article sums up the objections nicely:

Dwyer may have the best of intentions, but his proposal clearly goes too far. Yes, drunk driving is morally reprehensible, and those who do it should be punished according to the law. But they should also be given the opportunity to learn from their mistakes, change their ways, and become contributing members of society. If their face is immortalized in Facebook infamy, that recovery process would become significantly more challenging. Dwyer shouldn’t let the court of public opinion interfere with the court of law, because, as Lt. Reinhart said, “Law enforcement is not about public shaming.”

The suggestion that the proposal would “interfere with the court of law” is hyperbole.  But the sentiment that “the court of public opinion” should count for nothing radically misconceives the relationship between law and society.  Criminal laws and punishments are based on values held by society.  But activities prohibited by law are not the only ones a society might condemn, and criminal punishments are not the only ones society might elect to mete out.  Shame, for example, is important because it reinforces the notion that actions are not merely wrong because they result in a deprivation of liberty due to criminal punishment, but because they are evil and antisocial.  Likewise, enduring a criminal sentence is not the only mode of redemption; communities can offer acceptance and forgiveness and opportunity to rehabilitated individuals who have proven their good character.

Engaging in certain wrongful behavior is antisocial, and the function of shame in society is to root out and eliminate such behavior.  Indeed, the behavior that we choose to criminalize tends to be the behavior that is the most harmful, the most antisocial.  It is absurd to suggest that, by criminalizing such behavior, society loses its moral right to characterize the behavior as shameful.  It would be just as absurd as suggesting that, by defining and enforcing a criminal penalty against a convict, society loses its moral right to later characterize the convict as rehabilitated and forgiven.

I’d be willing to bet that most of the folks who are against the Huntington Beach proposal are also the sort who believe that government should stay out of the business of legislating morals.  The oddity, assuming I’m right, is that if it is supposed that law ought not deal in the sphere of morality and shame, and if it is also supposed that communities ought not deal in shame where the law provides a punishment, then the result is to have removed shame from our society altogether.  This, I think, would be a very bad thing.

* My thought is such a law obviously must be confined to those convicted of, not merely arrested for or charged with, DUIs, and that it must also be confined to repeated convictions, probably at least three, or perhaps two within an 18 or 24 month period.

Written by Tim Kowal

January 19, 2011 at 11:23 pm

Santa Ana’s Illegal Gift to Its Former City Attorney

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Under the California Constitution, gifts and payment for work already performed are illegal.  And with good reason, as I’ve explained before here and here with respect to public employee unions.  This recent op-ed on Santa Ana’s payout of backdated “vacation” and “sick-leave” to its city attorney indicates how basic legal and ethical principles continue to be ignored in this state.  From the piece:

Fletcher, upon leaving the city’s employ at the end of last year, cashed out $191,699 in unused vacation and sick-leave pay. Fletcher was able to do this because of a contract amendment that backdated the accrual of his vacation pay and the carryover of his sick leave as though he’d been hired in 1983 — 13 years before his actual hire date in 1996, according to Santa Ana Councilman Sal Tinajero.

Orange County Supervisor John Moorlach thinks this is an unconstitutional gift/payment for services already rendered.  It’s pretty simple, really:  The California Constitution prohibits “extra compensation or extra allowance to a public officer, public employee, or contractor after service has been rendered or a contract has been entered into and performed in whole or in part” (art. IV, § 17), and prohibits the grant of “extra compensation or extra allowance to a public officer, public employee, or contractor after service has been rendered or a contract has been entered into and performed in whole or in part” (art. XI, § 10).

If in fact Fletcher never worked during the time he purportedly “accrued” these vacation and sick days, it is a gift for work never done.  For that matter, it is also payment for work that he is already compensated for.  That is, since he apparently received the vacation and sick days due him for the years he actually did work from 1996 on, then crediting him for time he didn’t work—from 1983 to 1996—would effectively double-credit him the vacation and sick days he was due.

More likely, however, the city would take the position that the payment was merely structured that way as compensation for the time he actually did work.  That is, the vacation and sick days for those 13 years he didn’t work weren’t really “vacation” and “sick” days—classifying them as such was instead just a convenient machination for compensating him for his City Attorney services.  In this case, they city might be right:  this wouldn’t be unconstitutional; it would just be garden variety fraud.  Choose your poison.

Sadly, the City Attorney of my city, Huntington Beach, throws her lot in with the obfuscationists.  From the article:

Huntington Beach City Attorney Jennifer McGrath said that as long as the compensation has a valid public purpose, then even retroactive vacation and sick-leave benefits wouldn’t constitute a gift of public funds, which occurs when a governmental body gives away money without anything in return.

“It’s a case-by-case analysis — what becomes a gift of public funds or not,” McGrath said.

“Dave Mora, West Coast director for the International City/County Management Association, agreed with McGrath and said compensation for services can take a multitude of forms.

“It would be very difficult to try to describe that as a gift of public funds,” Mora said. “In my mind you’re also saying that a person’s salary is a gift of public funds.”

The law really isn’t that hard.  McGrath’s statement that the law provides no clear answer whether taking vacation and sick pay for three years time that you never worked requires a “case-by-case analysis” makes one wonder whether the law can ever tell us anything.

Written by Tim Kowal

January 12, 2011 at 5:43 pm

Jerry Brown takes aim at RDAs and Prop 13

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The Sacramento Bee reports that Gov. Jerry Brown is thinking about dismantling California’s redevelopment agencies.  While in law school, I published an article in the Albany Law Environmental Outlook Journal about California redevelopment law, the perverse incentives it creates for local RDAs, and the toll they take on our neighborhoods and budgets.  In particular, RDAs play fast and loose with “blight” determinations to get their hands on tax increment revenues that might otherwise flow to local school districts.  RDAs provide little voter participation and arguably constitute an improper delegation of legislative power.  And they cost over a half a billion dollars annually in administration alone.

California redevelopment law also provides RDAs incentive to redevelop areas irrespective of the likelihood that development might have been initiated by private enterprise.  In fact, it may be argued that the tax increment financing structure incentivizes RDAs to redevelop those areas most susceptible to private development, since these projects would have the highest likelihood and highest rate of return.  Yet, if RDAs are necessary, it is to ameliorate those areas that have the lowest likelihood of attracting private development.

I’m interested in seeing the arguments develop, but my instinct is to favor the proposal.

Also today I read that Brown is already addressing the splash damage of Prop 13 and the centralization of power in Sacramento that it created.  (As FlashReport notes, the media is spinning this as an attack on Prop 13, but this misstates what Brown has actually said.)  Not that this was unexpected, but he’s sure come out of the gate with guns blazing.  I’ll say this:  It’s going to be an interesting four years.

Written by Tim Kowal

January 4, 2011 at 11:13 pm

Sandefur on Kerr’s inconsistent positivism

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Tim Sandefur makes a very important point in response to what Orin Kerr at Volokh probably intended simply to be an amusing story:

Prof. Kerr points to an amusing case of poorly drafted legislation in Virginia, where, if read literally, the law prohibits “stopping any school bus which is stopped.” It’s pretty obvious that the statute’s confusingly worded—what the legislature meant was that cars are required to stop when they encounter a stopped school bus, no matter the direction from which the car approaches. That’s fine. The problem is, for Kerr to make this argument, he has to ignore the Holmesian positivism that forms his interpretive background, and end up contradicting his later comments about the Individual Mandate in Obamacare.

Kerr notes that “it’s clear what the legislature is trying to prohibit.” True, but only if you approach the statute with certain normative values, that you derive from some source outside the statute; that is, only if you come to your interpretive task with the assumption that there are certain standards of traffic safety that it’s sensible for the legislature to enforce—and certain standards of interpretation which it is appropriate to use when reading such a law. If, on the other hand, you rely solely on the language itself, as positivism would require, then it is not clear that the statute “should” be interpreted in anything other than a literal manner. To say that “statutes should be construed to avoid absurdity and to avoid unconstitutionality” is to assume a normative framework—just what positivists are far too clever and sophisticated to do—and thus to beg the question.

(Boldface mine.)  This obviously becomes much more important when we have to interpret the language in our Constitution concerning individual liberties and the limits of government power. Just as “we ought to start with assumptions about how buses and automobiles, and the statutes regulating them, should operate,” we likewise “should read the Constitution with assumptions, rooted in the Constitution’s purpose, history, and relationship to natural, human rights.”

This is a hugely important foundational matter in the way one approaches constitutional law. Though I disagree a lot with libertarians, Sandefur’s brand of natural law libertarianism is extremely compelling, which is why I, a natural law conservative, have high regard for Sandefur.*

* Even though to this day (well, yesterday), Tim seethes at my decision while editor-in-chief of the Chapman Law Review to publish a law review article with which he disagrees.  I was a little surprised to learn he’s still stewing over it given he’s never replied to my responses, e.g., here and here.

Written by Tim Kowal

December 4, 2010 at 8:05 pm

How economic regulation swallows jobs

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Speaking of tilling the soil for more government intervention, check out this great video from IJ.

H/T Sandefur

Written by Tim Kowal

November 13, 2010 at 10:55 am

Posted in Economics, Law

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