Bill Text: CA AB1955 | 2009-2010 | Regular Session | Amended
Bill Title: Local government: compensation.
Spectrum: Moderate Partisan Bill (Democrat 9-1)
Status: (Engrossed - Dead) 2010-08-31 - Withdrawn from committee. Ordered to third reading. Read third time. Urgency clause refused adoption. (Ayes 15. Noes 19. Page 5098.) Motion to reconsider made by Senator Florez. Reconsideration granted. (Ayes 37. Noes 0. Page 5099.) [AB1955 Detail]
Download: California-2009-AB1955-Amended.html
BILL NUMBER: AB 1955 AMENDED
BILL TEXT
AMENDED IN SENATE AUGUST 30, 2010
AMENDED IN SENATE AUGUST 20, 2010
AMENDED IN SENATE AUGUST 18, 2010
AMENDED IN SENATE AUGUST 10, 2010
AMENDED IN SENATE JUNE 23, 2010
AMENDED IN ASSEMBLY APRIL 12, 2010
AMENDED IN ASSEMBLY MARCH 18, 2010
INTRODUCED BY Assembly Member De La Torre
(Principal coauthors: Assembly Members Feuer and Ma)
(Principal coauthor: Senator Correa)
(Coauthors: Assembly Members Block, Eng, Gatto, Norby, Portantino,
and Solorio)
FEBRUARY 17, 2010
An act to amend Section 54957.6 of, and to add Sections 34096 and
54957.05 to, the Government Code, and to add Section
33138 to the Health and Safety Code, and to add Section
17043.5 to the Revenue and Taxation Code, relating to
public officers, and declaring the urgency thereof, to take effect
immediately.
LEGISLATIVE COUNSEL'S DIGEST
AB 1955, as amended, De La Torre. Local government: compensation.
(1) Existing law charges the Controller with various duties,
including, among others, superintending the fiscal concerns of the
state.
Existing law authorizes a city council to enact an ordinance
providing each member of the city council a salary based on the
population of the city, and to provide for other forms of
compensation, as specified.
This bill would require the Controller to determine, based on a
review of public records or reported salary information, whether a
city is an excess compensation city, as defined. The bill would
authorize a city to request a hearing, as specified, to contest the
Controller's determination. The bill would require the Controller, if
the city does not request a hearing or if the Attorney General
concurs with the Controller's determination after a hearing, to
notify the Franchise Tax Board city and
the redevelopment agency in the city of the city's status as an
excess compensation city, as prescribed.
(2) The Community Redevelopment Law authorizes the establishment
of redevelopment agencies in communities to address the effects of
blight, as defined, in blighted areas in those communities known as
project areas, and authorizes the agency to issue bonds.
This bill would prohibit the agency, once the agency has received
written notice from the Controller that the city is an excess
compensation city, from adopting a redevelopment plan for a new
project area or amending an existing redevelopment plan for existing
project areas; from issuing new bonds, notes, interim certificates,
debentures, or other obligations, as specified; and from encumbering
any funds or expending any moneys derived from any source except as
specified.
(3) The Personal Income Tax Law imposes taxes based upon taxable
income.
This bill would, for taxable years beginning on or after January
1, 2011, increase the tax rate applicable to 50% on that portion of
the gross income of a city council member of an excess compensation
city, as defined, that is in excess of the allowable amount.
(4)
(3) Existing law, the Ralph M. Brown Act, requires that
all meetings of a legislative body of a local agency be open and
public and all persons be permitted to attend unless a closed session
is authorized. The act authorizes a legislative body to hold a
closed session with the local agency's designated representatives
regarding various issues, including compensation, regarding its
represented and unrepresented employees, but the legislative body is
prohibited from taking final action on the proposed compensation of
one or more unrepresented employees.
Existing law also requires that all contracts of employment with a
local agency, as defined, for certain positions be ratified in an
open session of the governing body and be reflected in the governing
body's minutes.
This bill would require that any individual contract of employment
or amendment to a contract of employment with an employee who is or
will be employed by, and report directly to, the legislative body of
the local agency be ratified in an open session of the legislative
body after prescribed information regarding the contract or amendment
to the contract is made available in a conspicuous location on the
local agency's Internet Web site, if it maintains one, and in a
location that is freely accessible to the public, no later than 5
days prior to the meeting to ratify the contract or amend the
contract. By expanding the duties of local officials, these
provisions would impose a state-mandated local program.
This bill would also specify that final action on the proposed
compensation of one or more unrepresented employees who are to be
employed by, and report directly to, the legislative body of the
local agency only be taken in open session, consistent with the
prescribed disclosure requirements. By expanding the duties of local
officials, these provisions would impose a state-mandated local
program.
(5)
(4) The bill would express a legislative finding and
declaration that, to ensure the statewide integrity of local
government, disclosure of compensation paid to officers and
designated employees is an issue of statewide concern and not a
municipal affair and that, therefore, all cities, including charter
cities, would be subject to the provisions of the bill.
(6)
(5) The California Constitution requires the state to
reimburse local agencies and school districts for certain costs
mandated by the state. Statutory provisions establish procedures for
making that reimbursement.
This bill would provide that, if the Commission on State Mandates
determines that the bill contains costs mandated by the state,
reimbursement for those costs shall be made pursuant to these
statutory provisions.
(7)
(6) This bill would declare that it is to take effect
immediately as an urgency statute.
Vote: 2/3. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 34096 is added to the Government Code, to read:
34096. (a) If, based on a review of public records or salary
information reported to the Controller, the Controller reasonably
determines that a city meets the definition of an "excess
compensation city," as defined in subdivision (e), the Controller
shall notify the city and the Attorney General of that determination
in writing.
(b) (1) Within 10 days of receiving the written notice from the
Controller, the city may request a hearing before the Controller to
determine if the city is in compliance with Section 36516. Upon
receipt of the written notice, the Controller shall conduct a hearing
with at least 10 days' notice for the purpose of determining if the
city is an excess compensation city. At the hearing, the city may
demonstrate that the city is not an excess compensation city by
showing any of the following:
(A) Evidence of the approval by the city council of an ordinance
or an amendment to an ordinance that increases the council members'
salaries, pursuant to subdivision (a) of Section 36516.
(B) Evidence of the approval by the city's electors of a question
that increases the council members' salaries, pursuant to subdivision
(b) of Section 36516.
(C) Any other evidence of compliance with Section 36516.
(2) If the Controller determines that a city is an excess
compensation city after a hearing pursuant to this subdivision, the
Controller shall notify the Attorney General of that determination
and provide the Attorney General with any evidence submitted at the
hearing. The Attorney General shall be responsible for reviewing the
record of the hearing and shall concur or not concur with the
Controller's determination in writing within 60 days of receiving the
Controller's determination. If the Attorney General concurs with the
Controller's determination that a city is an excess compensation
city, the Controller shall proceed with the notifications, as
provided pursuant to subdivision (c).
(c) If the city does not request a hearing or if the Controller
determines, at the hearing, with the concurrence of the Attorney
General that the city is an "excess compensation city," the
Controller shall notify, in writing, the city , the
Franchise Tax Board, and the community redevelopment agency
in that city of the city's status as an excess compensation city.
(d) An excess compensation city may bring itself into compliance
with Section 36516. Once the city is in compliance with Section
36516, the city may submit a written request to the Controller to be
relieved of the status as an excess compensation city. If the
Controller determines that the city is in compliance with Section
36516, the Controller shall immediately notify, in writing, the city
, the Franchise Tax Board, and the community
redevelopment agency in that city of the change in status.
(e) (1) For purposes of this section, "excess compensation city"
means any city, including a charter city, that compensates any member
of that city council in excess of the amounts specified in Section
36516. An "excess compensation city" does not include a charter city
that has a population of over 285,000 persons.
(2) Notwithstanding paragraph (1), if the office of mayor is
independently elected, the city may demonstrate that additional
compensation paid to the mayor other than compensation for the mayor'
s position as a council member, has been provided by ordinance or in
the city's charter.
SEC. 2. Section 54957.05 is added to the Government Code, to read:
54957.05. Notwithstanding any other law, any individual contract
of employment or amendment to a contract of employment with an
employee who is or will be employed by, and report directly to, the
legislative body of the local agency shall be ratified in an open
session of the legislative body. Prior to ratifying the contract or
amending the contract, the legislative body shall disclose
information regarding the contract or amendment to the contract,
including, but not limited to, the employee's name, the position
title, and the total amount of salary, benefits, retirement, and any
other forms of compensation, in a conspicuous location on the local
agency's Internet Web site, if it maintains one, and in a location
that is freely accessible to members of the public, no later than
five days prior to the meeting to ratify the contract or amend the
contract.
SEC. 3. Section 54957.6 of the Government Code is amended to read:
54957.6. (a) Notwithstanding any other provision of law, a
legislative body of a local agency may hold closed sessions with the
local agency's designated representatives regarding the salaries,
salary schedules, or compensation paid in the form of fringe benefits
of its represented and unrepresented employees, and, for represented
employees, any other matter within the statutorily provided scope of
representation.
However, prior to the closed session, the legislative body of the
local agency shall hold an open and public session in which it
identifies its designated representatives.
Closed sessions of a legislative body of a local agency, as
permitted in this section, shall be for the purpose of reviewing its
position and instructing the local agency's designated
representatives.
Closed sessions, as permitted in this section, may take place
prior to and during consultations and discussions with
representatives of employee organizations and unrepresented
employees.
Closed sessions with the local agency's designated representative
regarding the salaries, salary schedules, or compensation paid in the
form of fringe benefits may include discussion of an agency's
available funds and funding priorities, but only insofar as these
discussions relate to providing instructions to the local agency's
designated representative.
Closed sessions held pursuant to this section shall not include
final action on the proposed compensation of one or more
unrepresented employees. Final action on the proposed compensation of
one or more unrepresented employees who are or will be employed by,
and report directly to, the legislative body of the local agency
shall occur in open session, and consistent with the disclosure
requirements of Section 54957.05.
For the purposes enumerated in this section, a legislative body of
a local agency may also meet with a state conciliator who has
intervened in the proceedings.
(b) For the purposes of this section, the term "employee" shall
include an officer or an independent contractor who functions as an
officer or an employee, but shall not include any elected official,
member of a legislative body, or other independent contractors.
SEC. 4. Section 33138 is added to the Health and Safety Code, to
read:
33138. (a) Upon written notification by the Controller that the
city in which the agency is established is an excess compensation
city, pursuant to Section 34096 of the Government Code, all of the
following shall apply:
(1) The agency shall not adopt redevelopment plans for a new
project area or amend an existing redevelopment plan for existing
project areas.
(2) The agency shall not issue new bonds, notes, interim
certificates, debentures, or other obligations, whether funded,
refunded, assumed, or otherwise, pursuant to Article 5 (commencing
with Section 33360) of Chapter 4.
(3) The agency shall not encumber any funds or expend any moneys
derived from any source, except that the agency may encumber funds
and expend funds to pay, if any, all of the following:
(A) Bonds, notes, interim certificates, debentures, or other
obligations issued by an agency before the imposition of the
prohibition in paragraph (2), whether funded, refunded, assumed, or
otherwise, pursuant to Article 5 (commencing with Section 33360) of
Chapter 4.
(B) Loans or moneys previously advanced to the agency, including,
but not limited to, loans from federal, state, or local agencies, or
a private entity.
(C) Contractual obligations that, if breached, could subject the
agency to damages or other liabilities or remedies.
(D) Obligations incurred pursuant to Section 33445.
(E) Indebtedness incurred pursuant to Section 33334.2 or 33334.6.
(F) Obligations incurred pursuant to Section 33401.
(G) Payments required under subdivision (a) of Section 33690 or
subdivision (a) of Section 33690.5.
(b) The prohibitions identified in subdivision (a) shall be lifted
after the Controller determines that the city is no longer an excess
compensation city pursuant to subdivision (d) of Section 34096 of
the Government Code.
SEC. 5. Section 17043.5 is added to the Revenue
and Taxation Code, to read:
17043.5. (a) For each taxable year beginning on or after January
1, 2011, in addition to any other taxes imposed by this part, an
additional tax shall be imposed at the rate of 50 percent on that
portion of a qualified taxpayer's gross income that is derived from
the excess compensation city that is in excess of the amounts
specified in Section 36516 of the Government Code.
(b) For purposes of this section:
(1) "Qualified taxpayer" means a member of a city council of an
excess compensation city.
(2) "Excess compensation city" means a city that has been
determined by the Controller to be an excess compensation city
pursuant to Section 34096 of the Government Code.
(c) The following shall not apply to the tax imposed by this
section:
(1) The provisions of Section 17039, relating to the allowance of
credits.
(2) The provisions of Section 17041, relating to filing status and
recomputation of the income tax brackets.
(3) The provisions of Section 17045, relating to joint returns.
SEC. 6. SEC. 5. The Legislature
finds and declares that the fiscal integrity and stability of local
governmental agencies in this state, including charter cities, has a
direct impact on the long-term well-being of all the residents of
this state. The likelihood of businesses locating to or staying in
the state is affected by the perception of a functioning,
transparent, and practical governmental structure in the local
governmental bodies in California. Therefore, the Legislature finds
and declares that to ensure the statewide integrity of local
government, the disclosure of compensation paid to officers and
designated employees is an issue of statewide concern and not a
municipal affair, as that term is used in Section 5 of Article XI of
the California Constitution. Therefore, this act shall apply to all
cities, including charter cities.
SEC. 7. SEC. 6. If the Commission on
State Mandates determines that this act contains costs mandated by
the state, reimbursement to local agencies and school districts for
those costs shall be made pursuant to Part 7 (commencing with Section
17500) of Division 4 of Title 2 of the Government Code.
SEC. 8. SEC. 7. This act is an
urgency statute necessary for the immediate preservation of the
public peace, health, or safety within the meaning of Article IV of
the Constitution and shall go into immediate effect. The facts
constituting the necessity are:
In order to preserve fiscal integrity and stability of local
government agencies in this state and the perception of a
functioning, transparent, and practical governmental structure in the
local government bodies in California at the earliest possible time,
it is necessary for this measure to take effect immediately.
