HomeMy WebLinkAbout1987-07-28; City Council; 9112; VOTING DELEGATE - ANNUAL LEAGUE CONFERENCEII CITY& CARLSBAD - AGENDAWL
"i
AB# ???/A DEPT. TITLE:
MTG. 7/28/87
RECOMMENDED ACTION:
CITY 1 CONFERENCE DEPT. CC
CITY I VOTING DELEGATE - ANNUAL LEAGUE
'p 2 Appoint a voting delegate and alternate to the League of California Cities
Annual Conference.
a,aJ uo cdc MU ITEM EXPLANATION:
da, alw
ac aJw
e.
0
that each City Council designate a voting delegate and an alternate. The u3
San Francisco, October 4 - 7, 1987, the League of California Cities has recA $*
In order to expedite the business session of the annual league conference i
.",a The City's voting delegate will be able to pick up the City's voting card a
.rl a,
ob0 ?a Business Session will be conducted on October 6, 1987. a, 04
c
e
ord U
u
cL1 ord md ww
a,.u League Registration Desk at the conference.
a, EXHIBITS :
CdaJ 1. League of California Cities bul1et.h dated July 8, 1987, e
53 =aJ
b-lrd
Pa, a,
4s -d UO GU =I 0% u3 (d
*d NC
wM oar Adp QG
2:
$8
22
44 -4 *rl
23 00 uu
h 03 I 03 hl
h I
2 2 G
6
8
4
z 3
"4
I
*!
Ca/iforn;a Cities I
Work Together
e
League
1400 K STREET
0
of California Cities- LtRts QT +
~~~i~~~~~i~~~~~
'h I& P32
e ?-
SACRAMENTO, CA 95814 0 (916) 444-57k qh" %:
87 Nu
: '195
Sacramento, CA c1\7y Oy ~~~~~~~~~~~
July 8, 1987
To: THE H0NORAEX.E MAYOR AND CITY COUNCIL
RE: DESIGNATION OF VOTING DEXEA!I'E EUR LEAGUE ANNUAL CONFERENCE
Dear City Official:
This year's League Annual Conference is scheduled for October 4-7 in San fianci
The mst important aspect of the Annual Conference is the General Business Sess which time the membership takes action on conference resolutions. It is imprti California cities to take the initiative in developing positive programs for thc future. Annual Conference resolutions will guide cities and the kague in OUL: 4
to improve the quality, responsiveness and vitality of local government within 1
state. All cities should be represented at the Business Session on Tuesday aftc
October 6, at 2:OO p.m. in San kancisco's Wcone Center.
To expedite the conduct of business at this important policy-making meeting, ea(
Council should designate a voting representative and an alternate who will be PI
at the Business Session. The League Constitution provides that each city is en1
to one vote in matters affecting municipal or League policy. A voting card wil: given to the city official designated by the City Council on the enclosed "votir
delegate form." If the Mayor or a member of the City Council is in attendance z
Cmference, it is expected that one of these officials will be designated as the
delegate. Bwever, if the City Council will not have a registered delegate at t
Conference but will be represented by other city officials, me of these offici;
should be designated the voting delegate or alternate.
Please forward the enclosed "voting delegate form" to the Sacramento office of 1
bgue at the earliest possible time, so that the proper records may be establi:
the Conference. The voting delegate my pick up the city's voting card in the 1
Registration Area at the -cone Center in San kancisco.
If neither the voting delegate nor alternate is able to attend the Business Ses~
the voting delegate or alternate may pass the voting card to another official fr
same city by appearing in person before a representative of the Credentials Corn
to make the exchange.
An outline of the voting procedures that will be followed at this conference is
on the reverse side of this mew. It is suggested that the Mayor and all Councj
Members from a given city try to sit together at the Business Session so that, j
amendments are considered, there may be an opportunity to exchange points of vie
arrive at a consensus before the city's vote is cast.
Your cooperation in returning the attached "voting delegate form'' as soon as ps
will be. appreciated.
lkn Benninyhoven
Executive Director
0 a
League of California Cities
Annual Conference Voting Procedures
1. Each mehr city with city officials registered at the Annual Conference has a
right to cast one vote on matters pertaining to League policy.
2. To cast the city's vote a city official must have in his or her possession the
city's voting card and be registered with the Credentials Committee.
3. Prior to the Annual Conference, each city should designate a voting delegate and alternate and return the Voting Delegate Form to the League for use by the
Credentials Committee.
4. The voting delegate or alternate may pick up the city's voting card at the votin delegate's desk in the conference registration area.
5. Free exchange of the voting card between the voting delegate and alternate is permitted e
6. If neither the voting delegate nor alternate is able to attend the Business Session, the voting delegate or alternate may pass the voting card to another
official from the same city by appearing in person before a representative of tE
Credentials Cornittee to make the exchange.
7. Qlalification of an initiative resolution is judged in part by the validity of
signatures. cxlly the signatures of city officials whol according to the record:
the Credentials Committee, are authorized to use the city's voting card and who
have left a sample of their signatures on the Credentials Committee's register 1
be approved.
8. In case of dispute, the Credentials Committee will determine the right of a citl
official to vote at the Business Session.
discdrft,policy
Member of City Council'
(TITLE) , , ,. .. < .. ,. .. . ,. .' .. - > : .,
.3
2. V~ING ALTERNATE: ' John Mamaux' f
(NAME) .. . ..
.\~ .
./
\.-
Not Later Than Friday, Septenker 18, 1987
Lx> .-
VTGDELFM.po1
a "3 0
"P League of California Cities wmm mmr, 1400 K STREET SACRAMENTO, CA95814 0 (916) 444-5790
California cities I Work Together Sacramento, CA September 24, 1986
TO : CITY CLERKS
FROM : LORRAINE MAGANA, CITY CLERK, SACRAMENTO AND PRESIDENT, CITY CLERKS DEPARTMENT
In recent years, the California voters have been faced with an increasing number of statewide initiatives which have long-range effects on local government. There were an unprecedented 11 local government measures on the June ballot and this November, eight of the 13 propositions will directly impact on us -- one could possibly change government in California as we now know it.
The Secretary of State's office reports that 29 percent of all eligible California voters are unregistered Employees unions estimate the unregistered could be as high as 40 percent among government employees!
As City Clerks, it is incumbent on us to provide voter registration. I would like to suggest that we do this aggressively and thoroughly within each of 01 cities to ensure that all city employees are registered before the October 6th deadline.
Please join the Secretary of State and City Clerks throughout the state in urging city employees to register. It is suggested you provide all employees with voter registration forms at their workplace and/or publicize registratio by mail through the Secretary of State's toll -free phone number --
(800)345-VOTE.
We can make a difference.
votreg.exec
z
mmr e e
::E HUW $ League of California Cities mmm HMr,
California Cities Work Together
*SPECIAL BULLETIN #6*
October 1, 1986
PROPOSITION 61: GANN PAY LIMITATION INITIATIVE
Information Package Index
Page Number
I. Management Issues Paper VI I:
11. Management Issues Paper VI1 I :
Turnover and Recruitment .................. 2
Inflationary and Compaction Impacts ............. 4
111. Newspaper Clippings ...................... 6
IV. Coal ition Memo ......................... 8
CONFERENCE REGISTRATION OFFICE BOX 7005, LAFAYETTE, CA 94549 (415) 283-2113
HEADQUARTERS
1400 K STREET, SACRAMENTO, CA 95814
(91 6) 444-5790
1052 WEST 6TH STF
SOUTHERN CALIF1
LOS ANGELES
(213) 482.
0 0
League of California Cities
Ca//forn;a Cities 7 Work Together Sacramento, CA October 1, 1986
TO : MAYORS, CITY MANAGERS, CITY ATTORNEYS, CITY CLERKS IN NON-MANAGEF CITIES, POLICE CHIEFS, FIRE CHIEFS, DIRECTORS OF PUBLIC WORKS, PERSONNEL DIRECTORS & DIRECTORS OF PARKS AND RECREATION
SUBJECT: SPECIAL BULLETINS: PROPOSITION 61
This is the sixth in a series of Special Bulletins on Proposition 61 -- the Gann Pay Limitation Initiative. The League is distributing these Bulletins an effort to inform city officials and employees of the potential impacts of the measure and how to prepare for them.
Since this ballot measure will affect fl municipal officials and employees, there is a great deal of interest in disseminating the information to as man
of them as possible. For this reason, we would appreciate it if you would copy and distribute these Bulletins to other city officials, department head and employees.
............................
SPECIAL ANNOUNCEMENT
THE NOVEMBER BALLOT -- ANNUAL CONFERENCE SEMINAR
On Sunday, October 19th at 2:OO p.m., the League of California Cities Annual Conference will present an hour-long session delving into two of the most import- ant ballot propositions facing California cities: Proposition 61 (Gann) and Proposition 62 (Jarvis).
Join our panel of campaign specialists and attorneys for an up-to-the-minute look at strategies, current issues
Room 212A of the Los Angeles Convention Center. and legal interpretations of these two measures in the
............................
CONFERENCE REGISTRATION OFFICE BOX 7005, LAFAYETTE, CA 94549 (415) 283-2113
HEADQUARTERS
1400 K STREET, SACRAMENTO, CA 95814 (916) 444-5790
1052 WEST 6TH S- SOUTHERN CALI
LOS ANGELE (213) 48
0 0
MANAGEMENT ISSUES PAPERS
These are the seventh and eighth in a series of management issues papers addressing the immediate impact, whether approved or not, of Gann's Public Salary Limitation Initiative (Proposition 61) on the November ballot. Previous Management Issues papers have addressed "Sick Leave and Vacation"; "Effective Date"; "Impact on Collective Bargaining"; "Salary and Compensation"; "Contracting for Services"; and "Retirement." Back issues can be obtained by contacting the League's Sacramento office or a full packet, containing all Management Issues Papers, will be available at the League's Annual Conference in Los Angeles, October 19-22.
Unfortunately, the drafting of the initiative does not permit clean and concise answers to many of the questions raised. The issue papers attempt to provide a literal interpretation--a restatement of what the initiative says and a reasonable interpretation based upon what the courts may determine to bl constitutional in carrying out the intent of the initiative should Propositiol
61 be approved.
-1-
0 0
PROPOSITION 61 - GANN INITIATIVE
MANAGEMENT ISSUE PAPER VI1
TURNOVER AND RECRUITMENT
While it is impossible to predict the level of turnover the public sector will experience if Proposition 61 passes, it seems reasonable to assume we will 1 ose many publ ic employees as wages decrease, benefits are withdrawn or reduced and employees feel a 1 ack of publ ic confidence and support.
Those eligible for retirement also will likely be leaving public office, especially employees whose benefits are calculated based on most rec,ent earnings. For example, the City of Los Angeles' Fire Department estimates approximately 900 firefighters and 100 paramedics may retire in anticipation of passage of Proposition 61. In addition to losing the value of the years of experience these professionals possess, the financial impact of training replacements could be as high as $30 million. (Los Ange7es Fire Chief Dona7d Manning in testimony before the Joint legis7ative Budget and Finance and Ways and Means Committees in fos Ange?es, Ju?y 1986.)
A second and equally important impact will be how to recruit top talent to fill vacated positions. Many jurisdictions are adopting a "wait and see" pol icy for the present time since it is difficult to foresee what terms and conditions will be available until after the November elections.
And, if the Initiative is successful, many other implications are suggested: Will we end up as a training ground for less qualified professionals who will gain experience managing local government, then leave for higher paying positions in other states or private industry? Will we have to "divvy up" job responsibilities and hire additional employees to work for salaries within the limitations? These questions are explored in a Senate Office of Research Analysis (August 1986), which reached the following conclusions:
'I. . .Imposing artificial and rigid price controls (i.e., salary/compensation limits) on California government will quickly and inevitability lead to the loss of thousands of officials and employees.
"Since the Initiative would control wages only in state and local governments (leaving wages in the private sector, the federal government and governments out of state untouched) and since California public agencies operate in regional, national and, in some cases, international labor markets, impacted employees will have both the incentive and opportunity to leave.
"For example, Dr. Robert Gale of the UCLA Medical Center is a bone-marrow specialist who, at the request of the Soviet Union, went to Kiev to treat the victims of the Chernobyl nuclear disaster. Dr. Gale obviously operates in an international labor market. It is absurd to think that a person of Dr. Gale's ski 11 s wi 11 remain at UCLA with a $64,00 sal ary cap when such an individual could successfully demand much more than that on the labor market."
- 2' -
@ 0
It might be added that since there are no provisions in the Initiative which state the minimum amount of time during which the $64,000 limit may be earnec Dr. Gale could conceivably still work for UCLA for a few months and earn the limit; UCLA could then hire as many additional specialists as needed to discharge the duties presently performed by Dr. Gale, each paid under the $64,000 limit, thereby increasing the costs to taxpayers by an untold amount
The State Senate report also offers one of the most telling indictments of tl imposition of salary limitations. Quoting from the President's Commission 01 Executive, Legislative and Judicial Salaries Report, which analyzed the
Congressional salaries. The Commission offers the following conclusion: effects of federal salary caps which tied federal employees' wages to
Setting these salaries has been a prolonged adventure in futility, and its harmful effects have reached a critical point. Many of our best qualified citizens do not even consider public service and many others leave because they cannot afford to stay.
- 3-
0 0
PROPOSITION 61 .. GANN INITIATIVE
MANAGEMENT ISSUE PAPER VI I1
INFLATIONARY AND COMPACTION IMPACTS
One of the less immediate, long-term effects of Proposition 61 will be the impact of inflation on the salary limitations. The Initiative does not include any allowance for indexing salaries or cost of living adjustments as we experience inflation (or conversely, recession) in the coming years. The only provisions for any adjustment to salaries are Section 26(c) and (d) which
require either a statewide vote for increases to salaries of constitutional officers, Board of Equalization members, Legislators, and judges or local votes in the case of local elected officials. Gann contends that the "special circumstances" of 26(b) also permit an increase but this applies only to state agencies.
The effects of this are fairly predictable. Salaries will not likely keep pace with rising costs and the problems of retention and/or recruitment will exacerbate as our top positions in the state become even less competitive in terms of compensation. According to the California Taxpayers Association, if the next 10 years sees inflation like the last 10 years, $64,000 will be worth
$30,000 in 1995. They ask "HOW many times are the voters likely to increase the Governors salary over the next decade?" ("The Gann Pub7ic Pay Limit: An Analysis, Cal-Tax Research Bu77etin, March 1986)
This situation is also inequitable across the board if other employees have adjustment provisions for inflation in their Memoranda of Understanding or if it has been a long-standing practice (as in most cities) to base increases at least partly on the cost of living index. Management may have to make some tough decisions whether to continue to allow this practice for all employees who fa1 1 bel ow the sal ary/compensation caps or el iminate it across the board (unless protected by a standing contract which can't be abrogated) in the interest of fairness.
Increases tied to inflation indicators will also put many employees over the limit in a short time. In the City of San Anselmo, for example, it is projected that all key management people will be at or over the $49,000 limit (if the limit is viewed as on total "compensation") within four years. Or, viewing the $64,000 limit as salary, an employee earning a $50,000 salary now and receiving a 5% merit increase and 2% cost of living adjustment each year will exceed the limit in just three years.
A re1 ated management decision will have to be made regarding salary differentials. Compaction will occur as personnel not affected by the initial limit earn promotions, merit and cost of living increases which eventually bring them to the cap. A compaction will also occur as personnel earning more
Sunnyvale for example, if salaries are cut to $64,000 limits, the top two levels of public safety employees would be paid at the same level; if viewed at $49,000 "compensation" 1 evel , 4 out of 5 1 evel s would be at the same 1 evel .
than the initiative limit are cut to permissible levels. In the City of
-4 -
L * e
The alternative to compaction would be a corresponding decrease in salary levels of ranks below those initially impacted. One example of the impact this could have comes from testimony of Los Angeles Fire Chief Donald Manning If the L. A. Fire Department Chief Engineer's compensation were reduced to the 80% level [of the Governor's salary] and if present salary differentials between fire department ranks were to remain constant, sal ary compaction woult result in a firefighter's hourly base rate of near the minimum hourly wage [presently $3.35 per hour].
Salary compaction or its alternative would virtually destroy carefully constructed civil service and merit systems. In addition, these systems are designed to maintain a rational relationship between salary paid individuals for different skill levels. Thus, roughly comparable salaries would be paid to employees regardless of relative levels of skill and responsibility.
As a result of salary compaction, the following effects may be anticipated. First, employees whose salaries are rolled back or approach the salary 1 imit, will over time would seek to leave government service either through retirement or employment in the private sector. Second, employee initiative and effort may be diminished to the extent that merit increases are not commensurate with ski1 1 and responsi bil ity. Third, employee morale in general Will most certainly decline. Fourth, assuming the Initiative does apply to "compensation", public agencies may endeavor to devise innovative fringe benefit packages to attract or retain top-level personnel.
II
r -2 -
z SE.0 3 ziZw-0 28 I 5 WWOU" nm -ma- g@-i-p $29gzg S"az@sm=g3 gym
-c. wygsg5-Eyw WWSGCbGU 0aiJou LnWa0Qcc g.: 0 F; u 3 8e ga Z-J(D,O~ S~Z-Y 33 3- 3 $;?6; i.-p 0 a- E w~.zgq$+ gg8$q p""p4s.p+ gg gQQ$ 5XG.E -5Q @c.agY < -am 3 Ei 0 "52 mm sEiq sogg.=eFgz: Bp-d= cclo -i p zs.3gw 5 * 85 "8' a 0 0 8 y "5 gzg"r W =gaEY ?I o-lgg qgg" ??2 0 a6 53 G-.&50_$gz"pqSg ~@~~o ~v:G5.P3u "30 c.00 -8 m5-&mr1,,g,; 809 CD -* pq dz 5 g0Q.S KE gw a 5.Ji *q g &yz €Lo GC. *m 3 -5 0 2: 0-g 5 g E I 3; * - 2.9 EjzmEj s.2 gz- w8(Dge W -i GKl I y
OCO c v, pl -er) 6ozQp 5m&lel g3"gFZ T!Z& si3,s,g$%$, o"$s $$$ r.m &.& rAvw w L.4 3boQS.m c? 2 2 B 9 4 5. 8' cpn c( 13w p * gp" 9 g CD E &g $5 -0 g"%g ggr1 ELc (D 01 (D 4
(D G gg% ?q '5.-c.s(D g m =r CDfi 5" m.3 35!2g:.Pg. 3 s.25 egg 2 g;g; *E 0 5.E 5'$+7: 2 $9 -0 &%E-;
Fu"+, CD wQ2 =w'B p 0 E: .&3zg kg% m%*3 < z33
X 2.8 &g 1 p eosl+,E: 33 g3 3g g EZh, OaY.Ocg g'FY G*
%. <S~(D uma3g 2.0
~z:,o-~~ z
c) gCb
3-
gE 308 33g?.Eo1 woE :;&5.&- m Fc.'in.!W g LnN 3 OOQSW e 3 3 e. 3 c- 09 ?I
E%$T~F o-aaxaz~. ow, as'mw SSWwq 05- 2oRF?G3g c w,,f+.o (D w &E.? g gES-2.
ss&g ScpD w Fpgs 8% %%& + szc 5'64 -4z2 la
WE; &.E
@E8 8
"309 z.09 + g, c. c
r5n e
fl $9
m 0 s-
0 E 034 Ei
5 5-El g
FEZ 9%
e 0,s 94 30 In CDgg38
'h4r\C.@@
53 54 0- zz.,
c W-W C.. e e- g.2 e @@ 8
!2%3 3" +.% 0" vY 5-e S'Gg3 =- e
0 g wcr 3swm ;g.g 01ggg sg 6 ? ;.Em Ewo;'S . ==pgr -=: 5.0 s 4 -2
2ZTO -2 e5gg 4 8 EK
--e < 0 53 0
5 Hj 0, 3c.d c.- 0 0 5 0-1 OOWSCD 3wamJ 0
UG45.3 "W
e
m< w "0
=;o w < c 0 w.5.
eO"LcDOoFJ'
3 5-s gs el=.za_g 8 C.Q
OOom 3 3 01 & 84 p2 =: g, p w.G -8 YE 0 0 (D 8 Egg&: zw 0 8 s y q
rm- I go2 dg -Qc%g pzp
KsJO !+SpQZ 0 5' 3 5. 3*8u 5. a= #+Y p,
0 avg sf. s 0 r; 3.5 UI 8 $7 2 gf'm
0, I Egz VJ w g.g.9 ,.E: 5. <go~3iio~30~
%CD e 2 !2 5'3 mg g g
s
g9at.,,,pw
sg
0,ggps w g.mg m E?
g33 5.- 0
-4e:ro. 6s 540 ga 34 g3-i
-E+ acnS
9 < sE.e =
809 Ei.3" 3 I +e I
Q\m 0 s b.0 - VJ m 009 69 YZ = CD El *-gE%'-S S$(S
El 5ug 3.2 gj e[.F 2 8 0 0
aSo4c"O Eo:o Eglg- n8g8 Ws- go qs@b 5.m-w
L g4 sz d UEO g$ (D m QW 5% G: g g5.a 5. I SF8 FE r2 5-g D (D F; Q.C. E;rgao - p+8~g,"Eo, *.-is f?$I ""-E -- $@g 9qgq; &o $a l=. ;.z eo 5. g x 2.2 xp:. P'Go& 88; <s 3gq
!+g. *%g go%= c.1 9s g.ggsd ga,
0. $2.5.g.5a g b" - gs3 I 09,ge&5. so 35
w-i
< KW
<w OSrn
53E, F 5-c: 2
THE DAILY RECORDER
Bpetmeber 25, 1986
-6-
a" '233
g.69
$2. 0
34 zz c. g.. -3
3 22
zg 25
sc
g 5'
Tw
%r a?
3 gg c3 5 35 8 3 e0 ZG 3 ygp:g %I a-oog
D, CDg=gg g.830 3 *=Z2% 5 =. ".y" 4. - GI=% 2 =$=Egg 5.0 m v) ip"5.S
R g.w -1% I
s-=:c. me 5 ~o~o= Pd
ooz < ggps= 6
F3 2.- -4 (D 5 8 0 q?? 9 3
E?2? rA R
%E - a.
$SF
E? 5.g :: E
gp
l==g -3s 3- s g e-5-
zb 3 W<a%p
52s s5 j;sp 2- p, WEE 28 a ,".a.
E-u =.n IgEE 5: g * 2" E" z
93 W $9 $ E$ gz 23 3% yg z
G g 2. - "8.33
22
ALL 3 %PC?
% v 8 0
v' I-
m
cb m
2'
G x cb f3 Y cb ? r;n
m 0
(D
f3 0 3
? 0
s -
c
-
\- * 9:.
.. & >i >B *f 2 2
e2-= - =: - .?c .. - 7;e
4 t f. ?,;, E -; 2 y i z T 3 ;-
%.E55 E:; f -z-.- oEz7,4 & - ;'+ 0 - :z zg 7.: zg -2 '"3 0 ./. 5 2 gz:gs2g5<F+." =gg 1 wzg.<;- "2-O
(D v, 2- ~ =c >"=spy ->3- (0 0 ~ z2 5 w h"'= LEU" ,=
8 ~g*~~U"~$2eE 3 r -*O_(3-~3g?f;,- -,.a5, s 0' '%g~=',?o";'$~ r? IU E=-,.. egaa--.a~ v x :E2? s, oc=-= 3 -0 T" .' ,pc-j,= -. m "Em. "+ "- Q =
(0 Z?E.+ a'<o-QT<. , 2.5 zs 5 c,: z
n we: =# =!y 5 c: =' -.
'E mc=*
-"
-3
in .= A%
r-7 Zgzs+=q= y Q y"O$ z2c<- =nr
x
0
Q,
B =&:g
&p*; 2 5 f pnG; 5$g %E =-.e
11, j -I=-
..: . g 4 j 5 -- w.' -$ I 0": ;gF
r-3 = 3 g 1: %' 2 0 72 - =j $ =gs 2 6 -. i? og: zw-2 CSW" zg ZZmf -
5' < 2-0 CE ze-z Fz fi.r& $2" cl?7nyz=k,Z
"L. %
;Y. -. L
c
2 l?p ;:I $073 fi;
5 ;E;
sg m2 3 =! $1
yw 0 a:, GP -3 - ! 6. s
7% 2 ;z
ss =; i;; 2 (f. 0
c :* .II
Zt-2 w, { c IZC; 6% 0 Drlk "'!Bp @= am:;
.c 1 Iw a 01 cv 2. 3p
v, ;zz ga "r~m! -? =z 5'0 f
-, t
=- 1;-
93
'4 - gi h) ? c<' Y gJgp -0-5 If 8, c1 4 =?3"gTq~f-:f~gg,"g ' ptgg3-z q gJ'80"S x-" asn -&e~&&~,-g=~ tpex q a .&gulp PO? I .g.s s sn. -8 35 09Y 5% 8 €-$ D'gj$$.$ I =
g""Rzg-s "go, sms &Sr('5fPc d3Eb*um,=oZ30g &coz"i%.o, "~~~s%$~~~~~~rs~,~pOr @.'e c * Z( mo "g6;c'p . 3.g ... "5 .'a%,- mga ~SaysNdgea Tzg2 3 ;6r sy-m -3 - 3 sz g? 3 -".c - y & 2gY u~~€~=~~~~~~~~~~~~~~~ s m e -*= gg g ps s2.m *EL7 ga 008 c3~~(D~~~,~--d~b?,$?~n"v, g @-E -G ~smca~so~~~~. *r pr ~~~~E~W~ gg~~~~~~~~'~~~~m*~~~ gga=sg dm g ~=~-~~~F~Pz 0 s=S.gs 00
2-c SMrn f wm D, --==m3g2vj e3 :z f0y-g I 3- s2.z z.g "¶E= g fD (D J, ~.~m~*~$vr2o~cJm= E$Ga.c 52 2p$ =% IT g 3 mw L co z g 50 c J s: ,*Eg.&:sw . '-
=gs s.= sdg c I$ S.&g ?2 7 2 2% g- p+so e2 z. 6.0 3s -3 ssp r: :e J crr*:-"-l 2 -=?a2 &zgg " (b~g;$?z"p: p 3 E$ m +E (b gF 3ppzE, =z.$ 2ZK.m *m - so l2 ge a.. z,=*= rnt2qQ~
w n'piliozg szmJ(D ;j &@.+z a- :-rz- ?$ at@ 3 3 -..4 :g zm = c Z!.$
m-03 =""3% 4sb&Z$ Ern E 3f x=? c0.s -#.E E= 3 g$e ,='"3q~$s Ft+qa? ;.isis7 J E: : s.s pEgTq9 ,,=e
g +m ,,a- "3
p3z 8 $ED g 3s ==43ZCZ.<3 B * 'OD b c2<3zcz.-<3 > ). cn + "d slDg-rn5; nq am 0 .E gi
% i o@m. : - p $i i . ob,(p: =sa. I< . g s p 5;om3p=gpc& g.$~3~~m3+3 3mgg%.rb -.. ... ai i $-"ai Q::i% : < pi ... i gz?; 8::: .IS" w.g 8% ca833 ti ... i : i 50; i i q ..* g=g m, g g 32. ;gt%g$ e. . v -:Lcs .. .... ... ... iiiozj;;??*iii~~~i;i~ .. .. y-@S- 70- ;Ic:wrs .!?'se;&..t : . .I. 8 , i Q ; j i ; gxg. gwd @. .. I:' * i. ;. z : : : g:-i, ; ; .,; _''
f .*@; '-3 g. ::: ... .:.. . . .. : :. " . . CC. , . g;;q ;gf' '*
g.?- m ab 2 c- ... ... ... ,n&= c "ln (1, ..- :: ::; I i i ... -3 p e c 3-3 -.. ... :: .. :;; i; i ... .... P=ln 3 S'P 0 8;
($3 O"cmx"ga=',, SS . . :mi; ... i i *. io;; i; 33 $4 g (Qa 8% s-. i: i . _gmgyg3Ls.s ... 8.08p 0-4 """3&y,- :::o. .. 0 % gg$j 01 0-4 QD 0%
3SSc Sag&sa $g!~;g~~; P 6) ".ao 8e ""d, -rt.o gs Q-4 me0 - "-% - .g3.? 5.g .. ,=-< gg 5 pz 8. ? su 5" e = o"ar 3Ld3 ".3 q
J(D aag ""-30 $!??ego3 'P < 5=": ,om 5; 2J-w a,o,'pe
'p a JkZ 9 g 5% 2 ?%sa= gmzs3 m g E s ii$q;p ggg
25 'p3Erg g4rn mij'*,m 3 I &gf+ ZZ3SE t' gsz at;;;;8 3z. g$ q& z 4 zi?Ss? 8sgg dda p gg %E,Ja$g
+ggeg &$&? 2 86?$ #8"8$ gn Pca
,p-2Fs;$=r* =-.%=. 2gz-x --- :<%g5J%'s!r$zz' z:653 av,eo, o~ NhlO'+,': -= zc;L 3eo,.3g31 2 sa& eq5 7s .Is =!5T=== z 5 z'=EU 2 "*"" -Tr&z"zQ2 s =.GO z"= s;: 8" 2 zgg ,o CF E= 2. --e . r.? - - QZ "pg*-.- 0 3.I 5' x A !2 EB. =my 'j 1: Sza' =.-2-s:' gc;e - %g?5z020@v azEFz=5,z -=r-
2.0 "gz- g.gT< e=*$= c w"o--L~gi;~ v x g z.-s 2 -.- - rv
7 -fi3&=- r: L: *, f gz,:3 M 2% ;= = =Z.s.Z E.€ 5% E j ~- 3 Nd * g g.2 g 5. s Ij 5 2 -2x5 s c.-$ z $ $ c c % -. F. - r/: "~=.,-: "r: c w -. =~= r: < 2 g s a?? % &= -%= ?"' :;Le ggozzgga --$n-z c Z&z &g.??4s zz==-* 2 _, 5 r. 2 I - -. .- xst*w ?"E z.g ,$.-2S -3 -
p-3 9 =~ ~ cpa cm q g 33 0 &E = q'= - o =*-
.=7~-.g~~-J-?-z- v, &~==. cc~+,=""i ?=%:'
"% c-2 -0wrn-zz g-? SF =, (1,' ~ - =?zz2 c;'oJ gg I a ysz gz 3x2 :: =.&z ? $igg @q zsga 5 Gg 0 g ,';co;j ?-,E E% c 5
Y "UP.g*3 Eg $zpE -5s -. .-. = pgs5aaCbp 0 =' 2'00 -2 2 %% 7 s ==e -sa: =;;L- E-.&yzg2s ;;e=- =f@ =g3zTCacmc; ni -x >+S 3 z.,o r: =? * gF D,x 2 I 5'- 752 - $9- -rLX v;c -sgg ;9c$2~.:~g-~~ "4.~g~~ - 3- ";i 37 $ Ez g.. 0 0 =z$&.~~ &GO Je=.m v&Jg:;?g.2.EE 0' 3 == aE~'o;-.~s a= p~~;~=7.~ y2===. =-3-s_ om E Ei& ;
-
3 9 =goo 0 c,m-t.
s3Cm F s3gg=nEv=* =~-.IEOE~ZSS a-
S+rndUl E:
CD -n=!cu3
i+ t: ,m J . p"5 2g 8' *
.c
g- SF
.Y =a- g -2 p
-m -L "3 E. . : c) : i 2% g: ; = g-!,~ =~@~@=~~o = c n: ca =, g$;Igzgofz9-( > =06)0a30@0 < aOzs<Q jp 2j$.zsT, 2GX
.." 9. r,; g jo a..g:.& *.- '
:' !.' f; f' [I' j j 1: 1' f{. [ : / :.i 1 .: 1 ' jRF ; *p&
e.: : & -. 0.: : -. . sr=a; * 2 . (P,@(bi FZ. .YO -1pq.Cf ;;1
Qg d .= "-.iiLmY , ... ... zm ... .. .. .:si::: "I.. =I i i -i .'
:iL"'"a. a,.qz $TPP- g gjpz ma%=
,
.. :?.-. i :. E: *..; ; ;
!. i [ .. ,
-.r
: : CC. ... -I .
: I : g; ! f i. .et..z $- ' !gg,. " -;.! i -i 4 .i ... ... ... fggqc 2 ... iiig;;;; L $=Kg &iF . ,
... .. ... -..
e%:$ zs-=p.z hs)u~h)&h)d zz-
.. Z"
,-a 3.9 3 0 =
3 so, 0323-0< 0 @a Uo;"~* 00 , --a Oa3Y 4AmQ
* c) CI 03 2 L.* ~~ge~~s ,2135. 3~=r?t?;sw n=mn -30 -e- -=-so =.= 03HV:y
I ,e "
=rq3zo.=5-+og,z n3- * ~ ;;+ 3 5' -a= c.- zy E s-s'n= v: -4 -
o n-.5'cEzs. gg3%Z' - :%"om c< B "'D 0-w ;gg, - - =
& *
=8$ gz nr. -5Z'd; Y sc - " -.' 096 e- =E - =
-Y~P,- a*Tw-?mc =agz xzt,3 -...x;,?o "F?. -, E -_ G K 8 2 , Lr C"-.-
0
September 23, 1986
NOTE: As a folloa to our Management ISSI
Papers which deal with these issues and whic
contain much of the following information, t
are providing this memo to you as requested
the Californian's for Quality Government Coz
Management Issues Task Force, of which the I
is a member.
TO: Chief Administrative Officers and Governing Board Members of California
Local Governments
FROM: Association of California School Administrators
Association of California Water Agencies
California Community College Trustees
California Municipal Utilities
California School Board Association
County Supervisors Association of California
League of California Cities
RE: Proposition 61
In response to our members inquiries, the above named associations have endorsed
the following actions to be taken by all local governmental agencies.
DO NOT ATTEMPT TO CIRCUMVENT PROPOSITION 61
Prior to the November 4 election, we strongly urge you to continue business as
usual and not undertake any activities which could be interprcted as an attempt to
circumvent the possible will of the voters.
Such activities would include unscheduled salary or contract increases or extensions,
entering into contracts with unrepresented employees, agreeing to terminate and reinstate employees prior to the effective date of the initiative, etc.
NOTIFY CONTRACTORS OF POTENTIAL IMPACT
We suggest you follow the lead made by some local agencies who have already notified their contractors and urged them to become informed about Proposition 61.
Attached is a sample notice.
NOTICE TO EMPLOYEES
We recommend you notify all of your employees about Proposition 61 and suggest
that they become informed about it. Attached are sample items which you are
welcome to use for notifying your employees.
-8 -
i' II_' ,
li .- m 0
League of California Cities
California Cities I Work Together
*SPECIAL BULLETIN f5*
September. 15, 1986
PROPOSITION 61: GANN PAY LIMITATION INITIATIVE
Information Package Index
Page Number
B I. Management Issues Paper VI:
11. Proposition 61: Fact vs. Fiction on the Gann Amendment
Retirement ......................... 2
Cal i fornia Taxpayers Assn. .................. 6
CONFERENCE REGISTRATION OFFICE BOX 7005, LAFAYETTE, CA 94549
(415) 283-2113
HEADQUARTERS
1400 K STREET, SACRAMENTO, CA 95814
(91 6) 444-5790
1052 WEST 6TH ST SOUTHERN CALI1
LOS ANGELE (213) 48:
0 0
League of California Cities
Ca/ifornia Clties I Work Togefher
Sacramento, CA September 15, 1986
TO : MAYORS, CITY MANAGERS, CITY ATTORNEYS, CITY CLERKS IN NON-MANAGER CITIES, POLICE CHIEFS, FIRE CHIEFS, DIRECTORS OF PUBLIC WORKS, PERSONNEL DIRECTORS & DIRECTORS OF PARKS AND RECREATION
SUBJECT: SPECIAL BULLETINS: PROPOSITION 61
This is the fifth in a series of Special Bulletins on Proposition 61 -- the Gann Pay Limitation Initiative. The League is distributing these Bulletins i an effort to inform city officials and employees of the potential impacts of the measure and how to prepare for them.
Since this ballot measure will affect all municipal officials and employees, there is a great deal of interest in disseminating the information to as manj of them as possible. For this reason, we would appreciate it if you would copy and distribute these Bulletins to other city officials, department head: and empl oyees.
CONFERENCE REGISTRATION OFFICE HEADQUARTERS SOUTHERN CALIFC BOX 7005, LAFAYETTE, CA 94549 1400 K STREET, SACRAMENTO, CA 95814 1052 WEST 6TH STR LOS ANGELES, (415) 283-21 13 (916) 444-5790 (213) 482-1
0 0
MANAGEMENT ISSUES PAPERS
This is the sixth,in a series of management issues papers addressing the immediate impact, whether approved or not, of Gann's Public Salary Limitation Initiative (Proposition 61) on the November ballot. The first management issues paper addressed the sick leave and vacation provisions of the initiative and was included in the League Special Bulletin dated August 1, 1986; "Effective Date'' and "Impact on Collective Bargaining" can be found in Special Bulletin #3, dated August 15th; and "Salary and Compensation" and "Contracting for Services" were in Bulletin #4, dated September 1. (Back issues can be obtained by contacting the League's Sacramento office.)
Unfortunately, the drafting of the initiative does not permit clean and concise answers to many of the questions raised. The issue papers attempt tc provide a literal interpretation--a restatement of what the initiative says and a reasonable interpretation based upon what the courts may determine to t constitutional in carrying out the intent of the initiative should Propositic 61 be approved.
Future issue papers will deal with inflation/compaction, turnover and recruitment.
-1-
0 W
PROPOSITION 61 - GANN INITIATIVE
MANAGEMENT ISSUE PAPER VI
RET I REMENT
The campaign literature used in the signature gathering effort sighted "obscene retirement benefits" paid to 16 retired state officials. It is ironic, however, that Proposition 61 does not address the basic problem - i.e., the linking of constitutional officer pensions to incumbent salaries. Proposition 57 on the November ballot does directly address this issue and is being supported by the League and most other organizations.
However, Proposition 61 certainly has many near retirement giving serious consideration to early retirement based upon the adverse impact the $64,000 cap and the loss of sick leave credit will have on future retirement benefits.
The initiative affects pension in two ways--first, by limiting salaries and sick leave credit thus limiting the final compensation used to calculate retirement benefits. Second, section 26 (f) restricting the total amount paid including pension benefits for those persons holding more than one paid public position.
Section 26 (f)
Section 26 (f) reads as follows:
"Any pub1 ic employee on the state or 1 oca1 1 eve1 who serves in more than one paid public position in this state may not receive a total
aggregate compensation, including pension payments derived in whole
or in part from public funds, in excess of eighty percent of the Governor's salary. It
Few employees who serve in more than one paid public position, pension payments derived in whole or part from public funds (i.e., military retirement pension or other public service pension) are likely to be considered part of the total aggregate compensation for that employee in determining the $64,000 cap. Some are concerned that including pension payments in determining the $64,000 limit could be interpreted to apply to all personnel, although the literal interpretation suggests this provision applies only to employees and officers serving in more than one paid public position.
Salary Restriction
Of the 380 cities in PERS, 165 cities have purchased the option of determining the pension benefit based upon the last year's salary for one or more classes of employees rather than the average of the last 3 years. For those whose retirement benefit is determined by the last year's salary, early retirement
may look particularly enticing and, of course, timing is also a consideration.
It is likely that your personnel office will receive many requests for copies of the PERS Appl icati on for Retirement (PERS-BEN 369). These employees are likely to submit this form with the members' effective retirement date just
- 2-
a 0
prior to the November 4 election. However, many of these same employees will likely wait until immediately following the election before submitting the Election of Optional Settlement and Beneficiary Designation (PERS-BEN 898) which must be notarized and returned to PERS before the retirement process is complete and the employee receives payments.
While a literal interpretation means loss of sick leave benefit credit and, for those immediately affected by the $64,000 pay cap, a reduction in "final" salary and thus conceivably lower retirement benefits in future years, a more reasonable interpretation would suggest DON'T PANIC. Employees should be reminded that a decision as imp0rtant.a~ retirement need npt be irrevocably made before November 4--Election Day.
Employees considering retirement because of Proposition 61 should be given copies of this paper and Management Issues .Papers I11 - Effective Date and I\ - Salary and Compensation. In addition, those employees in PERS should contact their PERS Area Office for counseling assistance and receive an estimate of retirement benefits under alternative options depending upon all the factors that affect their final retirement benefit, (i .e., years of service, bi rthdate, and final pay).
Final Comoensation
Generally, the final .compensation period (1 or 3 years) is the continuous period of employment 'immediately prior to retirement or any other period of : or 3 years as designated b~ the member on his/her application for retirement Since the final compensation (a1 so, see Government Code Sec. 20022 for definition of final compensation) period can be specified by the member at retirement, a member whose payrate was reduced because of Gann would be negatively impacted only to the extent that any post-Gann payrates in excess of the salary cap which wquld have been included in the final compensation period, cou1.d not now be included.
Effective Date of Retirement
Generally, the effective date of retirement cannot. be earlier than the first of the month .in which PERS receives the application and cannot be earlier th, the day following the last day on the payroll. In other words, although the employee has until the end of the month to apply for a November 1 effective retirement date, he/stie must be separated from employment at the close of
business on November 4. A member whose appl ication is received in November can retire on any date in November. Since the final compensation period can be specified, there would be no negative impacts to November retirements othl than that identified under final compensation.
Another consideration for these employees will be the PERS provision permitting unused sick leave to be credited to years of service in determini the retirement allowance. Since this is a vested retirement benefit, it is assumed that all sick leave accumulated as of December 31, 1986 would contin to be credited toward retirement.
-3. -
w
Because many employees are likely to seriously consider the option of retirement, it is important that both the personnel office and the employee have a clear understanding of the procedures for retirement under PERS. For this reason we encourage each personnel office to acquire from your PERS Area Office ample copies of PERS informational brochures (PERS-TPS-DO-2 and PERS-TPS-DO-7) and the Application for Retirement (PERS-BEN-369).
Employee considerat ions
- at least age 50 and five years of PERS - credited service
- if under 63, the benefit factor goes up for each completed quarter from the time of the birthday of the employee. (This factor is important in the determination of final compensation)
- an employee can receive from the PERS Area Office estimates of his/her retirement benefit under different time frames (this can be done by telephone)
- for employees with the sick leave benefit, unused sick leave is calculated at .004 per year for every 1 day of unused sick leave when determi ni ng years of servi ce.
- an employee may submit PERS-BEN-369 form after November 5 (but before November 30, 1986) with an effective date of retirement of November 4
- if the employee is off payroll by the close of business on November 4 (the Personnel office could hold the separation papers until after the election and the employee could take a day unpaid leave and then reassess the situation after the election).
In summary, a more reasonable approach based upon the court decisions mentioned in previous issues papers and the impairment of, contracts and vested right doctrines is for an employee to consider retirement after November 4 but before December 31 without putting in jeopardy his/her unused sick leave or salary in determining final compensation. Depending upon when salary adjustments are normally made, this may not be terribly reassuring to a long term dedicated employee who sees the Gann initiative jab away at his/her hard earned retirement benefits. Finally, cities with private retirement systems are encouraged to review their retirement plans with their carriers to clarify both provisions for and timing of early and regular retirements as they might be effected by Proposition 61.
cg715p5.pub
-4 -
i V e
/ f
0
0
0
CalTax Research .Bulletin
September 1986
Proposition 61 :
Fact vs. Fiction on the Gann Amendment
Introduction
In March this year, Cal-Tax News published a Research Bulletin by Cab
Tax Executive Vice President Richard
P. Simpson analyzing “The Gann Public Pay Limit,” an initiative constitutional amendment proposed by Paul Gann to limit pay in public employment. The petition had just begun circulating at that time. The Research Bulletin described the initiative, examined issues inherent in establishing a cap onpublic employees’ salaries, and outlined the basis for CaLTax’s opposition to the initiative.
This Research Bulletin, prepared by
Research Director Rebecca K. Taylor,
projects the fiscal and operational im-
pact of the initiative on state and local
governments.
Voters will have the opportunity to react to the Gann initiative, Proposition
61, on the November 4 ballot. When Gann turned in his petitions last May, he submitted 340,000 more signatures than the 630,186 needed to qualify the measure. According to reports filed with the Fair Political Practices Commission, he spent almost $950,,aX, to obtain them
Provisions of
o Limits the amount of service con-
tracts which public agencies may enter into to $75 per hour and $64,000 per year.
Becomes law November 5, the day after the election.
Who is Covered?
In written and spoken commentary
on Proposition 61, Gann maintains that
his initiative was not intended to cover
“regular” public employees. In the state voter pamphlet’s arguments, he stated
that Proposition 61 “ ... affects approx-
imately 7,000 or so of the State’s highest paid officials, while exempting civil service employees.”
Gann’s contention notwithstanding, legal authorities have said the initiative does indeed apply to public employees. At a July 1 hearing on the initiative held
by the Legislature, Attorney General
John Van De Kamp stated that the pro- posal appears to apply to all state and local government employees. Legisla- tive Counsel Bion Gregory seconded
this view in an opinion (#9145) published
July 10, 1986, addressing state civil service employees.
What lies behind this difference of
oDinion between leeal authorities and
ity’ for the Department of J same appointment mechanisl
most - if not all - local gov
There is a notable excer group of public employees. teachers are not appointel pursuant to Education Ca 44840, teachers are elected positions requiring certifica cations may be elected for t suing school year on and aft day of. March, and each elected shall be deemed re€
In another portion of the ment, Gann gives the follow tion of how his pay limitatic classroom teachers: “Even n the politicians are trying tl
with dire predictions ab
qualified teachers. But what
tell you is that the salar
(Emphasis in the original.)
One way to interpret thi; is that classroom teachers - plication all public employe( covered by the Gann initiz they earn more than $64,00( coverage in Section (b) does to be consistent with interpretation.
classroom teachers is $64,0
Proposition 61 Gann? The scope ofYthe initiative is set Court Changes forth in its Section (b), which states
0 Increases the Governor’s salary to “...no state, city, county, city and coun- Ballot Araument!
$80,000 from $49,100. ” ty or special district employee, elected
or appointed, which shall include in-
-
Sacramento County Sur
0 Restricts compensation of state and dividuals working under contract, may Judge John Sapunor found 1
percent of the Governor’s salary.” (Em- tion 61 did not apply to <
phasis added.) employees, to be “misleading ing two suits, one filed by ( According to Gann, this language countersuit by David Ross, applies to elected officials and persons les County Deputy Distric
local government 0fficials* e1ected Or aP- receive compensation in exceSS of eighty ballot arguments, contendi pointed, to no more than 80% of the Governor’s salary.
at $52,500.
Sets salary of constitutional officers
Requires a majority vote for future appointed by them who serve at their Judge Sapunor struck th
salary increases for elected officials at pleasure. Gann’s ballot argument. Th, the state or local level. required deletion of all refere Amording to Attorney General Van osition 61 as a pension refor 0 Prohibits public employees from De Kamp: “Under the state civil service carrying over earned sick leave and system, all state employees are ‘ap- vacation credits from one calendar year pointed.’ I (Van De Kamp) am by sta- Salary v. Compel , to another. tute, for example, the ‘appointing author- Another point of contro
L
\
Gal -Tax News e
f
actly what is being limited by the initia-
tive. With little regard for consistency,
the proposal speaks of limiting salary, annual salary, compensation, and total
aggregate compensation.
If the limit means compensation or
total compensation, the $64,000 cap is more like a $49,000 salary figure, with the remaining $15,000 equal to the
amount public agencies pay in fringe benefit costs for Social Security, retire- ment, health care, dental and vision
care, uniform allowance, and other benefits.
For many safety employees, the salary limit could be $40,000 or less.
This is because their retirement and disability benefits are more expensive
than those of general employees. In San
Francisco, for example, the city pays $1.05 into retirement for every dollar of salary. This benefit cost, together with other fringe benefits, would reduce the compensation cap to less than $30,000.
Overtime
Public agencies make extensive use of paid overtime to maintain required staffing levels in law enforcement, fire
protection, nursing, and other public protectionlregulatory services. It per-
mits government to operate without hir- ing additional personnel to fill in for employees on vacation or ill. The ability
to pay overtime is also a practical per-
sonnel management tool in time of emergencies.
This paid overtime could push employees over the Proposition 61 com- pensation limit, thereby causing juris-
coverage on a daily basis and during
emergencies. For example, county fire departments would have to employ ex- tra personnel year-round just to have
them available in the peak brushfire season.
dictions to overhire to ensure adequate
Public Employees
Affected
The number of public employees directly affected by a Proposition 61 salary limit would depend on whether the comparison salary is $64,000 or a total compensation figure 25% to 50% less than that.
The San Francisco Police Depart- ment provides a clear example of the potential impact of Proposition 61. If salaries are limited to $64,000, the
department’s entire top command - chief, four division chiefs, and three commanders - would have their sala-
ries reduced or frozen. However, if the initiative limits total compensation, all
L
w
Medical Salaries Above Gann Cap
Tulare County Hospital Table
Top Annual Sala
Position 711 I86
Physician, Orthopedic Surgeon $1 03,000
Physician, OBlGYN 98,124
Physician, General Surgeon 98,124
Physician, Internist 94,296
Physician, Pediatrics 90,612
Physician, Family Practice 89,274
Physician, General 8 1,240
Source: CSAC
1,971 officers in the department would be affected.
Seventeen county sheriffs would be
affected by a salary-only limit, as would 43 city police chiefs. If the limit is on compensation, however, an additional
116 top law enforcement officers would be affected. In all, 40% of California’s county sheriffs and city police chiefs
could see their pay cut or frozen by
Proposition 61.
Higher Education
At the University of California and the California State University, the ini- tiative comes down particularly hard in professional schools - medicine, den- tistry, optometry, nursing, phcirmacy, public health, veterinary medicine, engineering, business education, law, and architecture. At the nine UC cam-
puses, 74% of the teaching faculty now
receive higher compensation than Prop-
osition 61 would permit.
Public Hospitals
The hardest hit of professional
schools would be the UC’s five medical schools. Currently, 81% of their
teaching faculties are paid salaries at or above the Proposition 61 cap, and 91% are above the proposed compensation
cutoff.
County hospitals would be affected in a similar way. According to the Coun- ty Supervisors Association, all 34 coun- ty hospitals would have to freeze or reduce the salaries of medical staff under Proposition 61.
Hospitals in non-metropolitan en- vironments appear to be just as affected as those in Los Angeles or San Fran- cisco. (See Table 1) In all county employ- ment, 1,260 physician positions would be affected by the Gann salary limit. Similarly, top health officers would be above the salary cap in 30 counties, in- cluding those with small populations such as Imperial, Kings, and Butte.
K-12
With a salary of $29,000, an avera classroom teacher would not be direc threatened by the salary or cornpen’ tion limit; only 0.2% of all teachers nc receive enough compensation to be
fected. However, 53% Qf all administ
tors, including county and school sup intendents, receive compensation abc that amount: 2.7% are paid salar above the cap set by the initiative.
Effectively, the limit for classroc teachers will depend on the size a salary structure of each district. In t usual salary scheme, a district super tendent receives the top salary in t district, followed by the assista: district level department heads, schc site principals, vice principals, coun
lors, and school site department heal
Classroom teachers’ positions, on t bottom of the salary structure, are
least eight levels lower than a distr
superintendent’s in any large
medium-sized school district. Unc Proposition 61, salaries for classroc teachers inevitably would be adjust down to accommodate reasonable sal2 differentials between non-classroc administrators.
All certificated employees, cla,
room teachers and administrato
would be affected by the prohibition
leave carryover.
Cost/Savings
According to the official fisc impact statement prepared by the i partial Legislative Analyst, sta payroll costs would be reduced roughly $125 million if no public offic could be paid more than $64,000. Loc government reductions are estimated
the same level, for a total of some $2 million,
The Employment Developme Department reports 1.5 million Califc nia state and local government emplc ees as of June 1986. The total numb
b
4 0 e
/
~~~~~~ Payroll Reductions Under Proposition 61
(millions) Table 2
K-12
State uc CSU (certificated only)
-” Reduction $35.0 $42.5 $5.0 $2.9
1986-87 Base (including wage & benefits) $4,381 $1,945 $1,036 $7,700
Vo of Total 0.80% 2.1 8% 0.48% 0.38%
Source: Gal-Tax
of employees affected by the Gann salary limit is estimated at 18,000, or
mates salary reductions on average would constitute less than 1% of total payroll costs. (See Table 2)
1.1% of the workforce. Cal-Tax esti-
Accumulated
Leave Buy-Out
According to the ballot summary prepared by Attorney General Van De Kamp, ‘‘ ... salary reductions would not necessarily result in comparable sav- ings.” In testimony before the Legislature, the Attorney General said
that “accrued vacation time is a vested
benefit, and if it is cut off, the employee may well be constitutionally entitled to compensation for it. The conclusion with regard to sick leave time is not as cer- tain, but it too is probably a vested benefit to which an employee is entitled
as necessary if he or she remains in public employment and suffers illness.”
The cost of buying out accumulated
sick leave and vacation balances is esti-
mated at $7 billion by the Legislative
Analyst. Table 3 indicates public
employers’ liability by jurisdiction.
Additional
Tax Dollars?
Gann has consistently rejected the
charge that Proposition 61 could cost
additional tax dollars. In his view, vaca-
tion is already vested and thus no new
obligation. Because sick leave is not gen- erally held to be vested, no jurisdiction would have to cash it out, he contends.
Gann’s opponents point to a basic fallacy in this argument. The U. S. Con-
stitution guarantees that no property
right can be taken without due process
and just compensation. In Skelly u.
State Personnel Board, the state
Supreme Court held that state
employees have a property right in their employment. If this case is a precedent,
taking away accumulated leave without
Paying off leave balances in all cases
Public agencies do not now cash out
would necessitate new appropriations.
vacation balances, except on termina- tion. Agencies pay off terminating
employees from salary savings and other economies.
Earned sick leave is a benefit very
few jurisdictions cash out. Leave for ter-
minating employees issimply wiped off the books. Some employees are given retirement credit for accumulated sick leave and are in effect compensated for it over the years they receive a benefit.
In sum, a cash buy-out of earned sick
leave and vacation for public employees
is an obligation that public jurisdictions
do not now have. If the courts rule Prop-
osition 61 requires just compensation for taking away accumulated leave balances, the cost to taxpayers could be billions of dollars that have not been
appropriated.
Contract Limitations
Public jurisdictions unable to attract and retain competent personnel will probably be unable to contract with the private sector for the service the employees otherwise would provide. Section (h) of the initiative limits con- tracts in the following way: “ ... the Legislature shall enact no laws authoriz-
ing any public official covered section to engage the services of
subcontractors wherein thecont
amount of compensation e
seventy-five dollars per hour and tract may exceed two years in dl and in no event may the total c sation for an individual exce amount set forth in subsectiol (the $64,000 cap on salaries).
It is unclear whether bc dividuals and companies are sui the limitations on contracts.
Los Angeles County has this about the contract limitations:
“There ate many services pur
by the County from private conti that cannot feasibly be perforr county employees. Many of the tracts could be prohibited by the tive. Some examples of contracts would be affected include:
0 The pick-up, packaging and d
of low-level radioactive wastes pr
by the radiology units in count4
tals and health care facilities. T rent contract, which exceeds 4 per year, is with a federally li company which must conform to regulations.
0 After a major storm, the 1
contracts with operators of
volume loaders and cranes to cle debris basins and other flood ( facilities. These contracts excel
per hour.
“If these limits prohibit on cost-saving contracts that are a months in duration, then 108 COI would be eliminated for a cost ir of $14.5 million per year. If thest also prohibit our cost-saving COI that are over $64,000 per year months in duration, then 154 COI would be eliminated for a cost ir of $23.3 million per year.”
Sick LeaveNacation Liability (millions) 1
Buyout Bu Jurisdiction Six Leave Vat
State uc na csu included in vacation $301 Community College $1 50
Counties $700 Cities $1,000 Special Districts $1 85
Totals
-
$964
K-i 2 $1,943
- $4,942 $Z
Grand Total $7,158
just Compensation probably would not
, survive a court test. Source: Legislative Analyst, CSAC
\ ~ ~~
Gal -Tax News 0 w
Y
Actuaries and
Investment Counselors
Controller Kenneth Cory, the state's chief fiscal officer, has noted a sensitive area of public finance that would be negatively affected by contract limits in Proposition 61. In a letter accompany- ing benefit checks mailed to 100.000 retirees of the Public Employees' Retire ment System (PERS), Cory warned that the system's investment program could be endangered by contracting restric- tions. Currently, both PERS and the State Teachers' Retirement System con- tract with chief investment officers to manage their investment portfolios of $37 billion and $15 billion, respectively. Each contract is for more than double
the $64,000 limit in Proposition 61.
Emergencies
Proposition 61 makes no provision for waiver of its contract limitations in
time of emergencies. A county fire
department that needs a plane to drop flame retardant chemicals, or a levee district which must have heavy bulldoz- ing equipment to plug a leak, face the same problem: Proposition 61 prohibits them from contracting for equipment if the cost exceeds $75 per hour.
One alternative appears to be for these agencies to purchase a plane or
bulldozing equipment - probably at
heavy expense, and even though they may not be needed outside emergencies. Proposition 61 would not restrict the purchase of such equipment.
Windfall Retirement
Benefits
Opponents of Proposition 61 agree with Gann on only one point: windfall retirement benefits now received by cer- tain former constitutional officers must not be allowed to escalate.
Ironically, however, Gann's initia- tive would actually cause benefits to these individuals to increase beyond their already excessive levels. That is one reason that Sacramento Superior
CalTax Research -
founded in 1926 to advance economy and efficiency
Cal-Tax is a nonpartisan, nonprofit corporation
in government through research, aduocacy and
public communications. Cal-Tax is supported by
membership contributions from business and in-
diuidual taxpayers, 9.21 11th Street, Suite SOO, Sacramento, California 95814. (916) 44I-0490,
Arthur T. Cooke. Jr. .............. .President Richard P. Simpson . .Executive Vice President Rebecca K. Taylor ......... .Research Director
Retirement Allowances of Affected Former Constitutional Officers Tablc
January Allowance Allowanc
Current 1987 Under Prop. Under Prc
Allowance Allowance 61 (Gann) 57 (SCA 3
Pat Brown $64,524 $1 07,880 $105,129 $64,524
Tom Kuchel 55,920 92,136 69,084 55,920
Stanley Mosk 53,712 84,636 59,364 53,712
Alan Cranston 59,531 98,076 73,536 59,532
Jerry Brown 18,444' 31,500' 26,496' 18,444'
Richard Nevins 181,368' 181,368' 126,060' 181,368'
* Neither Jerry Brown nor Richard Nevins are presently receiving a retirement allowance. The above calcl
tions for these individuals are based on the unmodified allowance election. The unmodified allowance is highest allowance option payable. These individuals need not choose the unmodified allowance when tl
do retire.
Source: PERS
Court Judge Sapunor caused Gann to on how existing retirement plans mi&
drop all reference to pensions in his be enriched in a post-Proposition 61 e
arguments that will appear in the Plans that credit employees with 2%
voters' pamphlet. salary for each year of service could "
Table 4 explains how Proposition 61 affects retirement benefits of former constitutional officers in question. Six- teen officials are receiving these
enriched to 4% per year as a way to co pensate for salaries the measure WOI cap. Proposition 61 does nothing to p vent such increases.
benefits, and a 17th, Board of Equaliza- The measure also does not cut spel tion Chairman Richard Nevins, is slated ing or taxes, the claim by which Pz to receive them after retirement in Gann is most widely known to vote
January. Unlike Proposition 13, Proposition would increase the cost of operati
administers the retirement program, no more than 20 individuals are eligible for balances estimated at $7 biuon, of public employees' accumulated lea
the excessive benefits. Laws that made would negatively impact on govem~
living adjustments - the reason for the capable of attracting and retaining t
and 1974. No additional elected officials officids. can qualify for these benefits.
According to PERS, the agency that govement. Beyond a onetbe buy c
this goup eli@b1e for doub1e cost-of- efficiency by creathg a public sector
high payments - were changed in 1967 best and most responsible pub
The six officials cited in Table 4 are those Paul Gann referred to in his ballot arguments which the judge ruled "misleading." Proposition 57 was placed on the ballot in an attempt to block retirement benefits of the 16 former constitutional officers from in- creasing in January. These pensions are linked to salaries of incumbent constitu- tional officers and unless Proposition 57 passes, they will increase.
Conclusion
In soliciting signatures for his peti- tion and financial contributions to pro- mote Proposition 61. Paul Gann con-
stop outrageous pensions. As can be seen in Table 4, Proposition 61 allows pensions of some former constitutional officers to increase by as much as 63%.
Further, his measure places no limits
tended his measure was the only way to