BILL ANALYSIS Ó
AB 1787
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Date of Hearing: April 26, 2012
ASSEMBLY COMMITTEE ON PUBLIC EMPLOYEES, RETIREMENT AND SOCIAL
SECURITY
Warren T. Furutani, Chair
AB 1787 (Portantino) - As Amended: March 21, 2012
SUBJECT : State employment: salary freeze.
SUMMARY : Prohibits certain state employees whose annual base
salary is over $100,000 from receiving a salary increase or a
bonus until January 1, 2015. Specifically, this bill :
1)Prohibits state employees whose base salary is greater than
$100,000 per year from receiving a salary increase or a bonus,
until January 1, 2015, while employed in the same position or
classification.
2)Defines "person employed by the state" as any person employed
by the executive, legislative or judicial branches of
government, appointees to state boards and commissions, and
employees of the California State University system.
Specifies that local trial court employees are excluded from
this definition.
3)Exempts from these provisions state employees whose salaries
are governed by a Memoranda of Understanding, pursuant to a
collective bargaining agreement, a person who occupies a
classification that is deemed necessary to public safety and
security by the Governor through an executive order, or a
person whose salary is set by the State Constitution.
4)Requires that an amount equal to the savings to a state agency
from not paying a salary increase be credited each fiscal year
to the General Fund and, upon appropriation by the
Legislature, be made available for administering the AIDS Drug
Assistance Program (ADAP) within the Office of AIDS in the
State Department of Public Health.
5)Authorizes the Controller to reject a request for a
disbursement of funds that violates these provisions.
6)Urges the University of California system to adopt this
policy.
AB 1787
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7)Specifies that this section will remain in effect until
January 1, 2015.
EXISTING LAW :
1)Requires the Department of Personnel Administration (DPA) to
set and adjust salaries for each classification in state
service. DPA also has special salary setting authority for
certain statutorily exempt employees, primarily department and
agency secretaries, commissioners, and directors allowing DPA
to make salary determinations on a case-by-case basis after
considering a number of factors, including growth in the
position's stature and responsibilities, compensation paid in
similar positions in other jurisdictions, the need to avoid
salary compaction, and special recruitment needs.
2)Authorizes the California State Teachers' Retirement System
(CalSTRS) and the California Public Employees' Retirement
System (CalPERS) to set the compensation for specified key
executive and investment positions, including the chief
executive officer, system actuary, chief investment officers,
and other investment officers and portfolio managers whose
positions are designated as managerial.
FISCAL EFFECT : Unknown.
COMMENTS : According to the author, "California continues to
grapple with a fiscal crisis. As a result of the recession and
a now approximate $10 billion California budget shortfall,
important state services and programs have already been cut or
eliminated, with more likely to come in the next year.
California is continuing to face an economic crisis that could
soon leave the state without cash to pay its expenses.
"Given the state fiscal crisis and with unemployment rates in
California remaining high at 11.1 percent, it is not
unreasonable to place a salary freeze upon the highest paid
state employees.
"In his State of the Union address in 2010, President Obama
emphasized that government must tighten its fiscal belt; this
measure is an opportunity to heed that call. California has a
responsibility to show we are willing to rein in spending and
ensure that tax dollars are spent in a responsible manner.
AB 1787
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"Similar to my previous proposals, this measure will impose a
strict, categorical prohibition on any compensation increase for
state employees earning over $100,000. The legislation will
allow the Governor to make exemptions for certain safety
employees and exempts employees governed by a memorandum of
understanding, individuals covered by certain collective
bargaining agreements.
"Freezing the salaries of the State's highest paid employees is
a fiscally responsible way to preserve money for social programs
and education and help ease California's budget deficit."
Opponents state, "This bill would cause salary compaction and/or
reversal between rank and file and supervisors. There are many
state employees such as doctors, dentists, supervisors and
manager who receive salaries in excess of $100,000 due to their
advanced education and/or licenses. The current bargaining
units do not represent these employees; therefore, this measure
would allow bargaining units to procure salary increases within
the next three years for their rank and file members, while
supervising doctors, and dentists, for example, which are
excluded employees and not represented by a bargaining unit
would not receive similar raises or benefits. This possible
could cause rank-and-file employees the ability to make more
than their supervisors and in some cases more than their
managers."
This bill is similar to AB 7 (Portantino) from 2011, AB 1764
from 2010, and AB 53 (Portantino) from 2009 which were all held
on suspense in the Assembly Appropriations Committee. It is
also similar to the following special session bills from last
session: ABX2 1 (Portantino); ABX3 80 (Portantino); and, ABX8 33
(Portantino). None of the three special session bills were
heard in committee.
REGISTERED SUPPORT / OPPOSITION :
Support
AB 1787
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None on file
Opposition
California Association of Highway Patrolmen
California Correctional Supervisors Organization (unless
amended)
California State University
Professional Engineers in California Government
Analysis Prepared by : Karon Green / P.E., R. & S.S. / (916)
319-3957