BILL ANALYSIS
SB 501
Page 1
SENATE THIRD READING
SB 501 (Correa)
As Amended August 20, 2010
Majority vote
SENATE VOTE :Vote not relevant
LOCAL GOVERNMENT 6-0
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|Ayes:|Smyth, Caballero, | | |
| |Arambula, Bradford, Coto, | | |
| |Knight | | |
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SUMMARY : Requires filer of a county, city, city and county,
school district, special district, or joint powers agency (JPA),
to annually file a compensation disclosure form that provides
compensation information for the proceeding year. Specifically,
this bill :
1)Requires each filer to annually file a compensation disclosure
form that provides compensation information for the proceeding
year.
2)Specifies that the annual filing deadline for a compensation
disclosure form is the same as the filing deadline established
for annual statements of economic interest.
3)Defines "filer" as:
a) An elected or appointed officer of a county, city and
county, school district, special district, or JPA who is
statutorily required to file a statement of economic
interest pursuant to existing law.
b) Any person who is a superintendent, deputy
superintendent, assistant superintendent, associate
superintendent, community college president, community
college vice president, community college deputy vice
president, general manager, city manager, county
administrator, or other similar chief administrative
officer or chief executive officer of a local agency who is
required to file a statement of economic interest pursuant
to existing law.
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4)Defines "school district" as a school district, community
college district, county board of education, and county
superintendent of schools.
5)Defines "city" as a general law or charter city.
6)Requires that a filer file his or her compensation disclosure
form with the same office of the local agency that receives
that filer's statement of economic interest.
7)Creates an alternative to the individual filling process,
authorizing a local agency to compile the required disclosure
information for each filer and posting the information on its
website.
8)Requires a local agency to post its reimbursement policy on
its Internet Web site if that local agency is already required
by existing to develop a reimbursement policy.
9)Requires that, if a county, city, city and county, school
district, special district, or JPA maintains an Internet
Website, then it shall post the information contained on the
filed compensation disclosure form on that Internet Website.
10)Requires the Secretary of State to develop the compensation
disclosure form.
11)Requires the Secretary of State, when developing the
compensation disclosure form, to review and consider whether
the amounts listed in the Internal Revenue Service (IRS) W-2
for purposes of calculating Medicare taxes or in the case of a
contractor the amount listed in the IRS 1099 are sufficient.
12)Specifies that if the filer is a contractor, the compensation
disclosure form shall require disclosure of the contract's
compensation provision.
13)Requires the compensation disclosure form to, provide for
disclosure of each of the following:
a) Annual salary or stipend;
b) Local agency payments to the filer's deferred
compensation or defined benefit plans;
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c) Automobile and equipment allowances;
d) Supplemental incentive and bonus payments; and,
e) Local agency payments to the filer that are in excess of
the standard benefits that the local agency offers for all
other employees.
14)Specifies that information disclosed on the compensation
disclosure form shall also include any amounts received by a
filer as a result of membership with, or employment by, any
local agency, municipal corporation, public benefit
corporation, or community redevelopment agency, if the
membership of the filer's governing body is sufficient in
number to constitute a quorum or a majority of the governing
body membership of those entities.
15)Specifies that the compensation disclosure form is a public
record and shall be provided to a person upon request as soon
as practicable, but not later than the second business day
following the day on which the request was received.
16)Authorizes the district attorney or any interested person to
commence an action by mandamus or injunction to compel a
filer, county, city, city and county, school district, special
district or JPA to comply with the provisions of this measure.
17)Specifies that nothing in this measure shall be construed to
prevent a filer, county, city, city and county, school
district, special district or JPA from curing or correcting an
action challenging a compensation disclosure.
18)States that prior to any action being commenced, the district
attorney or interested person shall make a demand, in writing,
of the filer, county, city, city and county, school district,
special district or JPA to cure or correct the action alleged
to have been taken in violation of the provisions of this
measure.
19)Provides that within 30 days of receipt of the demand the
filer, county, city, city and county, school district, special
district or JPA shall cure or correct the alleged violation
and inform the demanding party in writing of that decision, or
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inform the demanding party in writing of its decision to not
cure or correct the alleged violations.
20)States that within 15 days of receipt of the written notice
of the decision to cure or correct an alleged violation, or
not to cure or correct, or within 15 days of the expiration of
the 30 day period to cure or correct, whichever is earlier,
the demanding party shall be required to commence the action
or thereafter be barred from commencing the action.
21)States that if the filer, county, city, city and county,
school district, special district or JPA takes no action
within the 30 day period, the inaction shall be deemed a
decision not to cure or correct the alleged violation, and the
15 day period to commence the action shall commence to run the
day after the 30 day period to cure or correct expires.
22)Provides that during any action seeking a judicial
determination regarding an alleged violation, if the court
determines, pursuant to a showing that an alleged violation
has been cured or corrected by a subsequent action, the action
filed shall be dismissed with prejudice.
23)Makes Legislative findings and declarations that the
disclosure of compensation paid to filers furthers the intent
and purpose of the California Constitution which declares that
the people have the right of access to information concerning
the conduct of the people's business.
24)Makes Legislative findings and declarations that the fiscal
integrity and stability of local government agencies in this
state, including charter cities, has a direct impact on the
long-term well-being of all the residents of this state and
therefore declares that the disclosure of compensation to
filers is an issue of statewide concern and not a municipal
affair and therefore shall apply to charter cities.
EXISTING LAW :
1)Prohibits a public official at any level of state or local
government from making, participating in making or in any way
attempting to use his official position to influence a
governmental decision in which he knows or has reason to know
he has a financial interest.
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2)Requires the following persons to file a statement of economic
interest disclosing his investments, his interests in real
property and his income during the period since their previous
economic statement was filed: state officers, judges and
commissioners of courts
of the judicial branch of government, members of the Public
Utilities Commission, members of the State Energy Resources
Conservation and Development Commission, members of the Fair
Political Practices Commission, members of the California
Coastal Commission, members of planning commissions, members
of the board of supervisors, district attorneys, county
counsels, county treasurers, and chief administrative officers
of counties, mayors, city managers, city attorneys, city
treasurers, chief administrative officers and members of city
councils of cities, and other public officials who manage
public investments, and to candidates for any of these offices
at any election.
3)Requires a statement of economic interest be filed as follows:
a) Persons holding the office of chief administrative
officer and candidates for and persons holding the office
of district attorney, county counsel, county treasurer, and
member of the board of supervisors - one original with the
county clerk, who shall make and retain a copy and forward
the original to the commission, which shall be the filing
officer; and,
b) Persons holding the office of city manager or, if there
is no city manager, the chief administrative officer, and
candidates for and persons holding the office of city
council member, city treasurer, city attorney, and mayor -
one original with the city clerk, who shall make and retain
a copy and forward the original to the commission, which
shall be the filing officer.
4)Provides that in enacting the Public Records Act, the
Legislature, mindful of the right of individuals to privacy,
finds and declares that access to information concerning the
conduct of the people's business is a fundamental and
necessary right of every person in this state.
5)Provides that every employment contract between a state or
local agency and any public official or public employee is a
public record.
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FISCAL EFFECT : Unknown
COMMENTS : On July 15, 2010, the Los Angles Times (Times) broke
the story that the City Manager in the City of Bell was being
paid nearly $800,000 annually for his services. This was just
two weeks after the Times reported that the Los Angeles County
District Attorney's Office was investigating why Council Members
in the City of Bell were making nearly $100,000 per year for a
part-time office.
These stories and many more in this series have caused a ripple
effect across California of local governments coming under
scrutiny for what they are paying officers and high-level
employees. Although information on compensation is available
through a public records request of the local agency, many times
this information is not easily accessible for the public to
find. In the case of Bell, it took the District Attorney's
office and a nationally known newspaper to make specified
request in order to obtain all the necessary documentation to
determine that in fact the City of Bell was paying excessive
salaries to both elected officials and several employees.
In the wake of the situation in the City of Bell, some cities
across the state have taken the opportunity to publicly disclose
salary information to their constituencies via legislative body
meetings, newspaper articles, and in some cases posting the
information on their website. In the City of Los Angeles, the
City Controller has now posted the annual salaries of every Los
Angeles City employee online sorted by position. This form of
additional transparency in government is a welcome relief for
many Californians. Although some local agencies have chosen to
provide this information in a more accessible format, some are
still trying to determine what their own agencies will do in
regards to this issue. This bill provides a comprehensive
statewide approach for how local agencies (counties, cities,
school districts, special districts, and JPAs) should make
compensation information easily available for constituents and
interested parties to review.
Existing law requires members of planning commissions, members
of the board of supervisors, district attorneys, county
counsels, county treasurers, and chief administrative officers
of counties, mayors, city managers, city attorneys, city
treasurers, chief administrative officers and members of city
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councils of cities, and other public officials who manage public
investments to annually file a statement of economic interest.
This bill requires that these same individuals file an annual
compensation disclosure form, developed by the Secretary of
State. The compensation disclosure form would require these
designated individuals to report on 1) the amount of salaries
and stipends paid; 2) total reimbursements received for expenses
annually; 3) employer's cost of providing benefits; and, 4) any
other monetary or non-monetary perquisites provided. Once the
form is filed with the local agency, this bill requires that if
the local agency maintains a website then the information
contained on the filed compensation form shall be posted on the
agency's website.
This bill is not the Legislature's first attempt at providing
more sunshine and transparency to local agencies. Local
agencies are already required to hold most of their meetings in
public under the Ralph M. Brown Act. Under the Public Records
Act, all but a few of the documents generated by the agency are
available for public inspection. Moreover, after a flurry of
questions on how local officials were using public resources and
on the ability of local officials to follow the ethical
guidelines set forth in statute, the Legislature stepped in and
developed legislation clarifying the rules pertaining to
compensation to members of a local government legislative body
for attendance at authorized meetings and conferences; required
the establishment of guidelines for reimbursement of members of
a local government legislative body for actual and necessary
expenses incurred in the performance of official duties; and,
established provisions for ethics training for local government
officials and designated employees [AB 1234 (Salinas), Chapter
700, Statutes of 2005].
Support Arguments: This bill provides a streamlined approach
for how compensation information on designated employees is
filed and made available to the public. This bill provides the
public with a document that can be easily obtained from a local
agency, thus providing the public with the opportunity to give
greater scrutiny on the compensation of designated officers and
employees. Supporters believe that with greater accessibility
of information egregious acts like those discovered in the City
of Bell will be less likely to occur.
Opposition Arguments: Opposition could argue that current law
requirements are working as seen in the case of Bell, where the
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District Attorney and the newspaper were able to obtain all the
necessary information through public records act requests. This
bill is yet another requirement on local agencies at a time when
funding is low. Moreover, opposition could argue that this
requirement should be on all government officers and employees
whether they are state or local.
Analysis Prepared by : Katie Kolitsos / L. GOV. / (916)
319-3958
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