Calif Gov. Freezes Hiring, Drops Minimum Wage Suit

SACRAMENTO, Calif. (AP) - Gov. Jerry Brown on Tuesday ordered a state government hiring freeze amid California's $26.6 billion fiscal crisis, hours after he dropped a lawsuit filed by former Gov. Arnold Schwarzenegger over whether the governor has the authority to pay state workers minimum wage.

Brown announced what he said was a comprehensive hiring freeze that applies to vacant, seasonal, full-time and part-time positions. The administration estimates the freeze, along with other cost-cutting efforts like reducing the number of state-issued cell phones, will save $363 million in the fiscal year that begins July 1, about $200 million of which will be in general fund savings.

"We must do everything possible to save money and make government leaner and more efficient," the Democratic governor said in a statement.

Brown is allowing for certain exemptions that are critical to public safety, revenue collection and other core functions. An example includes positions that respond to disasters or life-threatening situations. He also will continue to make senior-level appointments to form his new administration.

According to the state controller's office, California had about 234,000 employees as of Jan. 31.

Hiring freezes aren't new in California. Schwarzenegger ordered a state hiring freeze and payroll cuts to conserve cash as California struggled with a $42 billion budget deficit back in 2008. He also imposed days off without pay, which became known as "furlough Fridays."

As part of his budget, Brown has proposed a 10 percent pay cut for union-represented state employees that have yet to reach a contract with the state. Other bargaining units have already agreed to pay cuts.

Also Tuesday, Brown's administration announced it filed a dismissal in Sacramento County Superior Court. The filing ends Schwarzenegger's battle to impose the federal minimum wage on state workers during budget impasses. The three-page filing filed by the state Department of Personnel Administration indicated the Brown administration plans to work with the controller's office on future state employee pay issues.

"I am pleased and thankful that Governor Brown saw this litigation as a frivolous waste of hard-earned tax dollars that should be dedicated to fixing our schools, protecting our communities and rebuilding our infrastructure," state Controller John Chiang said in a statement.

Back in 2008, Schwarzenegger, a Republican, imposed the federal minimum wage on state workers while the state operated without a balanced budget. Chiang, who cuts state paychecks, refused to comply. That prompted the administration to sue and Chiang to counter sue.

According to Brown's dismissal, the state's aging payroll system was incapable of making the changes without "modifications at a potentially significant cost."

Labor groups applauded the move.

"Gov. Jerry Brown has done the right thing by dropping the minimum wage lawsuit," said Patty Velez, president of the California Association of Professional Scientists. "It isn't fair or reasonable to expect state scientists to work for minimum wage because the governor and state lawmakers can't agree on a budget."

The lawsuit isn't the first time Brown has departed from the previous administration. Last week, Brown dropped Schwarzenegger's plan to sell 24 state buildings to private investors to raise $1.2 billion for the general fund. Brown said the plan to lease back the office space at market rates didn't make sense because it amounted to "a gigantic loan with interest payments."

Brown has made a point of trimming back as the state faces its latest multibillion budget gap. In his first few weeks in office, Brown issued an executive order to halt new vehicle purchases by the state and directed vehicles that are not essential for state business to be turned in. Schwarzenegger also made similar efforts to reduce the state vehicle fleet.

Brown has also ordered half of the 96,000 phones issued to state bureaucrats to be turned in over an 18-month period.