## Facts

- California enacted the 2009 Budget Act appropriating funds for the 2009–2010 fiscal year amid a severe fiscal crisis.
- The Governor declared a fiscal emergency, and the Legislature convened in special session to revise the budget through midyear adjustments.
- The Legislature passed Assembly Bill 4X1 (AB 4X1), which reduced spending in various health and social-service programs by setting revised funding amounts.
- The Governor signed AB 4X1 but used the California Constitution’s line-item veto (art. IV, § 10(e)) to further reduce or eliminate specific AB 4X1 items, producing cuts greater than those enacted by the Legislature.
- Nonprofit and service-provider organizations affected by the reductions sought a writ of mandate, arguing the Governor exceeded constitutional authority and intruded on the Legislature’s appropriation power.
- The Court of Appeal denied relief; the California Supreme Court granted review and proceeded as an original writ matter.

## Issues

1. Whether AB 4X1 was a bill “containing appropriations” under article IV, section 10(e), permitting the Governor to use the line-item veto on its provisions.
2. Whether the Governor exceeded constitutional authority by using the line-item veto to further reduce items in AB 4X1 that themselves reduced amounts previously appropriated in the 2009 Budget Act.

## Decision

- The California Supreme Court denied the petition for writ of mandate and upheld the Governor’s line-item vetoes.
- The Court held AB 4X1 contained “items of appropriation” because it authorized expenditure of specified sums for specified purposes, even though it operated as a midyear revision reducing prior amounts.
- The Court held article IV, section 10(e) permits the Governor to reduce or eliminate items in such a bill, including items that reflect legislative reductions of existing appropriations.
- The Court largely adopted the Court of Appeal’s reasoning, with modifications that did not change the outcome.

## Legal Principles

- The Legislature holds the power of appropriation, but the Governor has constitutionally defined options for appropriations bills: sign, veto the bill, or reduce/eliminate one or more items of appropriation under article IV, section 10(e).
- A measure contains an “item of appropriation” when it authorizes the expenditure of a designated sum for a specified purpose; this includes amendments that revise or reduce previously enacted appropriations.
- Article IV, section 10(e) does not distinguish between original appropriations and revised appropriations; items in a midyear budget-adjustment bill are subject to the same line-item veto authority.
- Separation-of-powers concerns do not justify limiting the line-item veto beyond the constitutional text; political-branch checks include legislative structuring of appropriations and the veto-override process.
- Courts enforce constitutional structure and limits but do not reweigh policy choices in allocating scarce public funds during fiscal emergencies.

## Conclusion

The court held that a midyear budget-revision bill setting revised funding levels is a bill “containing appropriations,” and the Governor may use the line-item veto to further reduce or eliminate those items under article IV, section 10(e), even when the Legislature has already reduced the prior budget amounts.


St. John’s Well Child & Family Ctr. v. Schwarzenegger, 50 Cal. 4th 960, 239 P.3d 651 (Cal. 2010)