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HomeMy WebLinkAbout101023-03.3 STUDY STUDY SESSION MEMORANDUM 3.3 TO: Mayor and Town Council October 10, 2023 SUBJECT: Overview of SB 329 and Town Council Compensation BACKGROUND Compensation for city councilmembers in general law cities throughout California is governed by Government Code Sections 36516 and 36516.5. Section 36516 sets a base salary depending on the population of the city and allows for a 5% increase per year. Any increases must be approved by ordinance-automatic increases are prohibited. Section 36516.5 regulates the timing of any increase in compensation, providing that any adopted increase in council compensation does not become effective until at least one member of the council begins a new term of office. As a practical matter, this means that any approved increase becomes effective after a council election and the swearing in of those elected. The Town Council’s current compensation is set at $1,261 per month. That amount was set by the adoption of Ordinance No. 2022-04 and, pursuant to Government Code Section 365416.5, became effective in December 2022 after the last Council election. DISCUSSION The Legislature this year adopted SB 329, which amended Government Code Section 36516 for the first time since 1984. The bill (see attached), which becomes effective January 1, 2024, makes several changes to the existing law: • It increases the baseline salaries for all cities • When going beyond the baseline, it now allows for increases based on the California CPI (up to 10% per year), even if that amount exceeds the 5% per year otherwise allowed. • Any ordinance increasing Council compensation must contain findings “demonstrating the need for the increased compensation.” SB 329 2 October 10, 2023 Applying the new rules (which again, do not become effective until January 1), the new baseline maximum salary for a city of Danville’s population would be $1,275, slightly above the current salary of $1,261. The new provision allowing for an increase of CPI cannot be quantified at this time as it will be dependent on increases after January 1. The most recent CPI for California (June to June) was 3.1%. Using the 5% per year figure, an increase of $126 would be allowed, bringing the monthly total to $1,387. RECOMMENDATION Provide direction to Town staff on how to move forward with an ordinance adjusting Council compensation. Any change would be presented as an ordinance at a regular Town Council meeting and would not become effective until December 2024. Prepared by: Robert B. Ewing City Attorney Attachment: Government Code Section 36516, as amended SB 329 3 October 10, 2023 SECTION 1. The Legislature finds and declares all of the following: (a) The compensation schedule for general law cities has not been adjusted since 1984, meaning that city council compensation has not kept pace with inflation. (b) Allowing cities to adjust their compensation for inflation since 1984 may help city councils become more diverse because increased compensation can help individuals from across different income levels receive sufficient income from their service to help ensure that they can continue to serve the public and support their families. SEC. 2. Section 36516 of the Government Code is amended to read: 36516. (a) (1) A city council may enact an ordinance providing that each member of the city council shall receive a salary based on the population of the city as set forth in paragraph (2). (2) The salaries approved by ordinance under paragraph (1) shall be as follows: (A) In cities up to and including 35,000 in population, up to and including three nine hundred fifty dollars ($300) ($950) per month. (B) In cities over 35,000 up to and including 50,000 in population, up to and including four hundred dollars ($400) one thousand two hundred seventy-five dollars ($1,275) per month. (C) In cities over 50,000 up to and including 75,000 in population, up to and including five one thousand six hundred dollars ($500) ($1,600) per month. (D) In cities over 75,000 up to and including 150,000 in population, up to and including six one thousand nine hundred dollars ($600) ($1,900) per month. (E) In cities over 150,000 up to and including 250,000 in population, up to and including eight hundred dollars ($800) two thousand five hundred fifty dollars ($2,550) per month. (F) In cities over 250,000 population, up to and including one three thousand two hundred dollars ($1,000) ($3,200) per month. (3) For the purposes of this subdivision, the population of a city shall be determined by the last preceding federal census, or a subsequent census, or estimate validated by the Department of Finance. (4) The salary of council members may be increased beyond the amount provided in this subdivision by an ordinance or by an amendment to an ordinance, but the amount of the increase shall not exceed an amount equal to 5 percent for each calendar year from the operative date of the last adjustment of the salary in effect when the ordinance or amendment is enacted. No ordinance shall be enacted or amended to provide automatic future increases in salary. the greater of either of the following: (A) An amount equal to 5 percent for each calendar year from the operative date of the last adjustment of the salary in effect when the ordinance or amendment is enacted. (B) An amount equal to inflation since January 1, 2024, based upon the California Consumer Price Index, which shall not exceed 10 percent for each calendar year. (5) No ordinance shall be enacted or amended to provide automatic future increases in salary. (b) Notwithstanding subdivision (a), at any municipal election, the question of whether city council members shall receive a salary for services, and the amount of that salary, may be submitted to the electors. If a majority of the electors voting at the election favor it, all of the council members shall receive the salary specified in the election call. The salary of council members may be increased beyond the amount provided in this section or decreased below the amount in the same manner. (c) Unless specifically authorized by another statute, a city council may not enact an ordinance providing for compensation to city council members in excess of that authorized by the procedures described in subdivisions (a) and (b). For the purposes of this section, compensation includes payment for service by a city council member on a commission, committee, board, authority, or SB 329 4 October 10, 2023 similar body on which the city council member serves. If the other statute that authorizes the compensation does not specify the amount of compensation, the maximum amount shall be one hundred fifty dollars ($150) per month for each commission, committee, board, authority, or similar body. (d) Any amounts paid by a city for retirement, health and welfare, and federal social security benefits shall not be included for purposes of determining salary under this section, provided that the same benefits are available and paid by the city for its employees. (e) Any amounts paid by a city to reimburse a council member for actual and necessary expenses pursuant to Section 36514.5 shall not be included for purposes of determining salary pursuant to this section. (f) A city council member may waive any or all of the compensation permitted by this section. (g) (1) For the purposes of this section, a city council shall consider the adoption of an ordinance to increase compensation in open session during at least two regular meetings of the city council. (2) At the first meeting, the city council shall present the proposed ordinance, which shall include findings demonstrating the need for the increased compensation. The ordinance shall not be adopted at the first meeting. (3) At least seven days after the first meeting, the city council shall hold a second meeting to consider whether to adopt the ordinance.