Gov. Arnold Schwarzenegger’s executive order to force state workers to take a third unpaid day off each month has drawn a legal challenge from the Professional Engineers in State Government. Other legal challenges were expected.

On Wednesday, after opposing a compromise plan offered by the Legislature, Schwarzenegger declared a state of fiscal emergency. Accompanying his declaration was an order requiring state workers to take a third Friday off each month. The order translates into about seven weeks of unpaid work a year, or a pay reduction of about 13 percent, by one estimate.

He also ordered state offices to be closed on the first, second and third Fridays of the month.* For this month only, the three furlough days will fall on the second, third, and fourth Fridays, said Lynelle Jolley, a spokeswoman for the Department of Personnel Administration.

The governor already called for special session of the Legislature to deal with fiscal issues. The governor has the authority to require lawmakers to convene, but he cannot compel them to take action.

Schwarzenegger’s order was issued on the opening day of the 2009-10 fiscal year. On paper, a budget is in place, but the spending plan is awash in red ink and attempts to pass legislation to cover the gap have failed repeatedly. The Republican governor has demanded deeper cuts in services, and Democrats in the Legislature have balked.

Law enforcement agencies, state prisons and hospitals and firefighters will maintain normal hours of operation.

The governor’s order this week was just one indication of the state’s dire fiscal condition. State Controller John Chiang, who keeps the state’s checkbook, planned to issue IOUs to state venders, among others, who provide services to the state. Chiang had been warning that such a move was likely unless the state dealt with its cash crunch. He said the state could run out of money by July.
The state last issued IOUs in 1992, and before that had issued them only during the Great Depression. The IOUs are checks called registered warrants that can be cashed only at certain times.

Meanwhile, the professional engineers said the governor’s order would cripple the state’s ability to rebuild by forcing the government to hire expensive, private engineers.

“Engineers are working to expedite infrastructure projects which create jobs and rebuild the economy,” said Mark Sheahan, President of PECG. “Telling people to stay home a third day a month slows economic recovery.”

As state-employed engineers are ordered to stay home three days per month, the work would have to be outsourced to private companies at more than twice the cost. “With a $26 billion budget deficit, outsourcing this work at more than twice the cost to taxpayers is outrageous,” said Sheahan. “This Executive Order mandates the waste that the Governor says he wants to eliminate.”
Some 95 percent of PECG’s members are paid through special funds, such as gas tax, federal funds, and other sources. “Cutting our pay won’t help the General fund, but it will cost the taxpayers more than twice as much,” said Sheahan.

In June of this year, the Governor’s Department of Finance and the Legislature concluded that a state engineer costs the taxpayers $103,000 a year, but outsourcing the same work costs $232,000, according to PECG.

The group already has filed a suit challenging the legality of the governor’s earlier order requiring two furlough days per month.

*Ed. Note: This corrects an earlier version in which the closure days were incorrectly reported.