SACRAMENTO -- — Gov. Arnold Schwarzenegger has prepared an order to cut the pay of about 200,000 state workers to the federal minimum wage of $6.55 an hour until a budget is signed.
Administration officials said Schwarzenegger was expected to sign the order, a draft of which was obtained Wednesday by The Times, early next week as part of an effort to avert a cash crisis. The deadline for passing a budget was July 1, and without one soon, the officials said, California may be unable to borrow billions of dollars needed to keep the state solvent.
State Controller John Chiang, asserting that the state has enough money on hand, said through a spokesman that he would not implement such an order. Chiang's office handles payroll for government workers.
The Republican governor's controversial plan, likely to be challenged in court by public-employee unions if carried out, would allow the state to defer paying about $1 billion a month, administration officials said. Workers would be repaid their lost earnings once a budget was in place.
As drafted, the order also calls for the state to immediately lay off 21,855 part-time workers, stop overtime payments for almost all employees and cease all hiring until a budget is enacted.
"Because the Legislature has failed to pass a budget and our state does not have a rainy-day fund, this is one of a number of options we are considering to make sure we have sufficient cash to cover our costs," said administration spokesman Matt David.
Until recently, the governor had played a relatively minor role in budget negotiations since offering his revised spending plan in May. As public frustration over Sacramento's handling of the budget has mounted, much of the blame has fallen on him. His approval rating among voters is 40%, according to a Field Poll released this week, down from 60% in December.
The executive order appears intended to show that Schwarzenegger is taking action and to pressure lawmakers to finish work on the budget. Democrats rely on the major public employee unions to help bankroll their political campaigns, and the public-safety unions that Republicans often look to for support could be affected by his order.
Once the order took effect, most state employees, who are paid once a month, would not see another paycheck until the end of August. If the budget was passed late in that month, their full salaries would still be reflected in that paycheck.
