Chiang announced on June 2, 2011, that unless the state legislature passed a balanced budget by June 15, the deadline specified in the California Constitution, he would start docking their pay. He said, "In passing Proposition 25 last November, voters clearly stated they expect their representatives to make the difficult decisions needed to resolve any budget shortfalls by the mandatory deadline, or be penalized. I will enforce the voters' demand."

On June 22, Chiang announced that he was following through with his promise. Legislators did pass a budget, but according to Chiang, the budget they passed had a $1.85 billion deficit, and was therefore not a legal budget under the state's requirement that its budget must be balanced. Therefore, Chiang said, there was functionally no budget and by the terms of Proposition 25, he was required to stop paying the state's legislators. The impact to individual members of the California State Legislature was about $400/day. In Chiang's statement, he said that parts of the budget the legislature did pass were "miscalculated, miscounted or unfinished."

Mike Gatto, a member of the California State Assembly, was one of several state legislators angered by Chiang's action. Gatto said, "John Chiang just wants to sit there and beat up on the unpopular kids. I now have to explain to my wife and daughter that we won't be able to pay the bills because a politician chose to grandstand at our expense."

The editorial board of the Los Angeles Times had endorsed Proposition 25, but when Chiang announced on June 22 that he was stopping state legislative pay under its terms, the editorial board came out swinging against Chiang's action, referring to "an ill-advised provision" of Proposition 25 as well as to "poorly worded or deceptive measures with unforeseen consequences."

Sued by legislators

On January 24, 2012, Democratic lawmakers sued Chiang for withholding their pay, saying it was a misuse of power. The suit did not ask for reimbursement of the pay, but rather sought to have the court bar the controller from doing it again if legislators approve a budget that they believe is balanced.

Senate President Pro Tem Darrell Steinberg (D) said the controller does not have the power to say if a budget is sound or not, stating, "Neither the governor nor any member of the executive branch may brandish the threat of withholding legislative pay because they disagree with the decisions made by the legislative branch."

Chiang issued a statement, noting, "While nothing in the Constitution gives me the authority to judge the honesty, legitimacy or viability of a budget, it does clearly restrict my authority to issue pay to legislators when they fail to enact a balanced budget by the constitutional deadline of June 15."

Board of Equalization (1999-2005)

Before becoming state controller, Chiang was elected to the Board of Equalization in 1998 where he served two terms, including three years as chair. The Board of Equalization collects California state sales and use tax, as well as fuel, alcohol, and tobacco taxes and fees that provide revenue for state government and essential funding for counties, cities, and special districts.

Chiang was first elected to the state treasurer's office on November 4, 2014. He was sworn into office on January 5, 2015, replacing term-limited predecessor Bill Lockyer (D). Chiang did not run for re-election in 2018.

Chiang was first elected to the state controller's office on November 7, 2006 and was subsequently re-elected on November 2, 2010.

Enforcement of Proposition 25

Chiang announced on June 2, 2011, that unless the state legislature passed a balanced budget by June 15, the deadline specified in the California Constitution, he would start docking their pay. He said, "In passing Proposition 25 last November, voters clearly stated they expect their representatives to make the difficult decisions needed to resolve any budget shortfalls by the mandatory deadline, or be penalized. I will enforce the voters' demand."

On June 22, Chiang announced that he was following through with his promise. Legislators did pass a budget, but according to Chiang, the budget they passed had a $1.85 billion deficit, and was therefore not a legal budget under the state's requirement that its budget must be balanced. Therefore, Chiang said, there was functionally no budget and by the terms of Proposition 25, he was required to stop paying the state's legislators. The impact to individual members of the California State Legislature was about $400/day. In Chiang's statement, he said that parts of the budget the legislature did pass were "miscalculated, miscounted or unfinished."

Mike Gatto, a member of the California State Assembly, was one of several state legislators angered by Chiang's action. Gatto said, "John Chiang just wants to sit there and beat up on the unpopular kids. I now have to explain to my wife and daughter that we won't be able to pay the bills because a politician chose to grandstand at our expense."

The editorial board of the Los Angeles Times had endorsed Proposition 25, but when Chiang announced on June 22 that he was stopping state legislative pay under its terms, the editorial board came out swinging against Chiang's action, referring to "an ill-advised provision" of Proposition 25 as well as to "poorly worded or deceptive measures with unforeseen consequences."

Sued by legislators

On January 24, 2012, Democratic lawmakers sued Chiang for withholding their pay, saying it was a misuse of power. The suit did not ask for reimbursement of the pay, but rather sought to have the court bar the controller from doing it again if legislators approve a budget that they believe is balanced.

Senate President Pro Tem Darrell Steinberg (D) said the controller does not have the power to say if a budget is sound or not, stating, "Neither the governor nor any member of the executive branch may brandish the threat of withholding legislative pay because they disagree with the decisions made by the legislative branch."

Chiang issued a statement, noting, "While nothing in the Constitution gives me the authority to judge the honesty, legitimacy or viability of a budget, it does clearly restrict my authority to issue pay to legislators when they fail to enact a balanced budget by the constitutional deadline of June 15."

Before becoming state controller, Chiang was elected to the Board of Equalization in 1998 where he served two terms, including three years as chair. The Board of Equalization collects California state sales and use tax, as well as fuel, alcohol, and tobacco taxes and fees that provide revenue for state government and essential funding for counties, cities, and special districts.