SAN FRANCISCO - As he had threatened, the federal receiver charged with bringing California's prison health care system up to constitutional muster yesterday sought a court order demanding $8 billion from the state government to build health care facilities.
The receiver, Clark Kelso, has broad powers backed by the federal judge who ordered the state prison hospital system into receivership after ruling that California had failed to implement a 2002 settlement agreement in a case that argued that health care services provided to inmates were so inadequate they violated prisoners' constitutional rights.
Kelso's motion in U.S. District Court asks Judge Thelton Henderson to hold Gov. Arnold Schwarzenegger and state Controller John Chiang in contempt of court for failing to deliver the capital funding.
His $8 billion demand comes amid a budget crisis that has left the state without a budget six weeks into the fiscal year and lawmakers deadlocked over how to resolve a fiscal 2009 deficit projected at more than $15 billion - not counting the receiver's prison health care request.
"We have fully explored and exhausted every avenue for securing this funding in a manner that least affects California's taxpayers and this year's budget process, but the state's leaders have failed to act," Kelso said yesterday in the statement announcing the motion. "Therefore, it is with great reluctance, and yet a sense of firm conviction, that today, I seek the court's intervention to secure this funding."
Kelso had said he would seek a court order after a bill to authorize lease-revenue bonds to finance the prison health care projects failed in the state Senate in May, after the Republican caucus held firm and denied the bill the two-thirds majority vote it required for passage.
Kelso's request demands $3.1 billion in the current fiscal year - which is the amount of bonds that would have been issued this year in his lease-revenue bond request.
In addition to the capital funding demands, Kelso's motion asks Judge Henderson to order the state to pay $2 million in daily fines until the capital construction program is funded, with daily fines growing in $1 million increments every 10 days.
It also asks the judge to encumber any investment earnings in the state's Surplus Money Investment Fund until another suitable source of funding is provided, and asks the court to force Chiang to submit a plan to draw enough funds from the state treasury to pay for the receivership's immediate funding needs within three days.
"I understand Mr. Kelso is taking the steps he believes are necessary to fulfill his court-appointed duties, and I support his efforts to bring the state's prison health care system up to constitutional standards," Chiang said in a statement. "However, my office cannot expend funds from the Treasury unless there is a legislatively approved appropriation or a court order compelling payment. At this time, there is neither."
Chiang said he believes the Legislature should approve the lease-revenue bonds Kelso requested. Kelso said Chiang and Schwarzenegger could be compelled to appear in court in September if there is no resolution.