BILL ANALYSIS Ó SB 1436 Page 1 Date of Hearing: June 29, 2016 ASSEMBLY COMMITTEE ON APPROPRIATIONS Lorena Gonzalez, Chair SB 1436 (Bates) - As Amended April 6, 2016 ----------------------------------------------------------------- |Policy |Local Government |Vote:|9 - 0 | |Committee: | | | | | | | | | | | | | | ----------------------------------------------------------------- Urgency: No State Mandated Local Program: YesReimbursable: No SUMMARY: This bill requires a local agency's legislative body, prior to taking final action, to orally report in an open meeting a summary of a recommendation for a final action on the salaries, salary schedules, or compensation paid in the form of fringe benefits of a local agency executive. This bill further provides that the above provision will not affect the public's right under the California Public Records Act (Public Records Act) to inspect or copy records created or received in the process of developing the recommendation. SB 1436 Page 2 FISCAL EFFECT: There are no reimbursable local mandate costs because any costs incurred by local agencies would fall under Proposition 42. (See Comment #3 below.) COMMENTS: 1)Purpose. According to the author, "There is a public interest in ensuring that decisions made by legislative bodies of local agencies regarding local agency executive compensation are open and transparent. Local agency executives, such as agency CEOs and city managers, are offered fringe benefits including health care coverage and pensions in amounts that can have a significant long-term impact on the budget and that deserve particular scrutiny by the public. The intent of the law for openness and transparency is not achieved if the final action on executive compensation is taken without an oral reporting of a summary of the recommendation for final action. By facilitating open and public consideration of local agency executive compensation, this measure furthers the intent of the law." 2)Background. In 2011, in response to the scandal surrounding the City of Bell, the Legislature passed AB 1344 (Feuer), Chapter 692, Statutes of 2011. AB 1344 requires a number of good governance measures regarding compensation practices to provide the public with the opportunity to be informed of, and comment on, local compensation-setting practices. Among its many provisions, AB 1344 prohibits a legislative body from calling a special meeting regarding the salaries, salary schedules or compensation paid in the form of fringe benefits of a local agency executive. SB 1436 Page 3 This bill is intended to further the goals of AB 1344 by ensuring that executive compensation is at least mentioned, via an oral report of the recommended action, in an open meeting before a local agency governing board takes final action on the issue. 3)Proposition 42. Proposition 42 was passed by voters on June 3, 2014, and requires all local governments to comply with the Public Records Act and the Brown Act and with any subsequent changes to those Acts. Proposition 42 also eliminated reimbursement to local agencies for costs of complying with the Public Records Act and the Brown Act. 4)Prior Legislation. a) SB 407 (Hill), Chapter 213, Statutes of 2013, extends limitations on local agencies' employment contracts to cover additional employees. b) AB 1344 (Feuer), Chapter 692, Statutes of 2011, restricts local government compensation practices and specified procedures for adopting city charters. SB 1436 Page 4 Analysis Prepared by:Jennifer Swenson / APPR. / (916) 319-2081