Governor appeals judge's furlough ruling

(08-11) 04:00 PDT Sacramento - --

An estimated 156,000 state workers scheduled to be furloughed on Friday and two other days this month will likely come to work after all, following a ruling by an Alameda County judge that temporarily bars the governor from imposing the unpaid days off.

Gov. Arnold Schwarzenegger's administration, however, appealed the ruling Tuesday morning. Lawyers for the governor also asked the appeals court to stay Superior Court Judge Steven Brick's decision so that Friday's furlough can go forward as planned.

Schwarzenegger ordered the furloughs last month, citing an impending cash crisis. The state's fiscal year began July 1, but California still does not have a budget in place.

Several state unions sued over the furlough order, and late Monday night, Brick temporarily barred Schwarzenegger from imposing the furloughs until a full hearing on the matter can take place in September.

In his eight-page decision, Brick wrote that the unions "raised at least serious questions concerning (the governor's) authority to implement furloughs," by executive order, and also succeeded in showing that the work stoppages cause "great or irreparable harm" to some of their members.

The evidence of harm to the governor and state, on the other hand, is "far less clear," Brick wrote. He said the governor failed to prove that the estimated $80 million to $110 million in savings over the next month will accomplish its purposes of preventing the state from running out of cash.

"It appears just as likely that the state's financial woes will continue - at least until a new budget has been adopted by the Legislature and signed by the governor - whether the proposed furloughs are allowed to be implemented on Aug. 13 2010 or not," Brick wrote.

The Schwarzenegger administration, however, wrote in its appeal that barring the furloughs will "significantly exacerbate the state's already precarious cash situation." It called the furloughs "one of the aggressive cash management efforts the administration is required to take to preserve vital cash assets." It noted that state Controller John Chiang has repeatedly warned - and did so again Tuesday - that without a balanced budget, he will be forced to issue IOUs by the end of this month or in early September.

Union leaders - who accused the governor of using the furloughs to pressure their members and lawmakers into his budget demands - praised Brick's decision.

"This means that state offices will stay open, public services will continue, infrastructure projects won't be delayed, and employees won't be cheated out of their paychecks," said Bruce Blanning, executive director of the Professional Engineers in California Government. The union, which represents about 11,000 engineers at Caltrans and other agencies, took the lead in the lawsuit.

Schwarzenegger spokesman Aaron McLear, however, said the governor expects an appeals court to allow the furloughs to go forward this week.

"The governor has the authority to implement furloughs," he said. "As long as the Legislature fails to produce a budget and the state faces IOUs, we will do what we must to reduce costs."

The suit is one of several pending against the state, following Schwarzenegger's 2009 decision to force state workers to take unpaid time off. But the latest order by the governor only covers about two-thirds of state employees and exempts members of the six bargaining units that have reached tentative concession agreements with the Schwarzenegger administration. Unlike past furlough orders, it also exempts employees at revenue-generating agencies such as the Franchise Tax Board.

E-mail Marisa Lagos at mlagos@sfchronicle.com.

This article appeared on page C - 4 of the San Francisco Chronicle