As California’s Secretary of State prepares to take a new job as U.S. Senator, he’s not going to let a politically charged $35 million invoice get in the way of a smooth promotion.

In a press conference Wednesday, Alex Padilla assured reporters that the multimillion-dollar tab his office owes to SKDKnickerbocker, a Biden-affiliated PR shop, will be “resolved soon.” 

As CalMatters has reported, that unresolved contract has pit one branch of California’s Democratically controlled government against another while providing fodder for Republican critics and conservative litigants eager to undermine the state’s next U.S. Senator.  

“The Controller’s office, the Department of Finance — everyone is sharpening their pencils and working it out,” said Padilla, whom Gov. Gavin Newsom appointed Tuesday to take the seat of Sen. Kamala Harris, the vice president-elect. 

Newsom, on the same press call, was also quick to wave away any concerns about the unpaid and legally contentious bill.

“We’re working with Legislative leadership and (the Department of) Finance and we’ll get that paid,” he said. 

Neither Newsom nor Padilla elaborated on what a final, workable agreement would look like and whether it would ultimately require legislation. In a statement, Senate Pro Tem Toni Atkins merely said, “we still expect the issue to be resolved, and will continue to evaluate all of the options.”

As Secretary of State, Padilla served as California’s chief election administrator during an election season unlike any other. In the summer of 2020, his office hired SKDKnickerbocker to produce an ad campaign to explain the new election procedures to California’s voters. Padilla’s office intended to pay the PR firm out of a pot of cash meant to fund county government voter outreach operations. 

But Betty Yee, California’s controller who is responsible for signing off on all state government payments, has so far refused to okay the outlay, arguing that Padilla’s office lacks the authority to spend that money on behalf of the counties.

Today, Padilla described the unpaid bill as a mere bureaucratic hangup that critics have seized on for political purposes.  

“The only real question here is which account is it going to be paid out of. That’s where there are some technical questions and disagreements that will still be resolved,” he said. 

Sara Floor, a spokesperson for the California State Association of Counties, which represents county government interests in the capital, said the organization did not have a position on the intragovernmental conflict. 

Beyond the disagreement with Yee, the contract with a Democratically-aligned firm has also rankled Republicans in both California and Washington. 

Responding to the news of Padilla’s appointment to Harris’ senate seat yesterday, Jessica Millan Patterson, chairwoman of the California Republican Party said in a statement that “Governor Gavin Newsom couldn’t have picked a more partisan politician who has yet to answer for his illegal $35 million get-out-the-vote contract with a ‘Team Biden’ PR firm.”

In early October, the Howard Jarvis Taxpayers Association sued, accusing the Secretary of illegally spending taxpayer money and violating the law that governs how public agencies should enter into contracts with business. 

As the Sacramento Bee first reported, Padilla’s office did not award the contract to the lowest bidder, but instead evaluated each submission based on how the applicant proposed to spend the $35 million that had been appropriated by the Legislature.

Padilla will be replaced as Secretary of State by San Diego Democratic Assemblymember Shirley Weber. In today’s press conference, she noted that she was not involved with the inking of the deal but also expressed confidence that the state’s bean counters will be able to “handle the issue.” 

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Ben ChristopherHousing Reporter

Ben covers housing policy and previously covered California politics and elections. Prior to these roles at CalMatters, he was a contributing writer for CalMatters reporting on the state's economy and...