SACRAMENTO – Joined by members of the Assembly and Senate today, Speaker John A. Pérez (D-Los Angeles) and Senate President pro Tem Darrell Steinberg (D-Sacramento) unveiled a package of bipartisan legislative reforms to create greater transparency and accountability in response to the financial scandals in the City of Bell.
“The outrageous salaries paid to Bell city officials, including the city manager and city council members is insulting to the hardworking people of Bell, and all Californians,” Pérez said. “The reform package we are advancing today will prevent future Bells, and help ensure the tax dollars paid by the people of California are spent properly.”
Joining Pérez and Steinberg were Assemblymembers Hector De La Torre (D-South Gate), Mike Gatto (D-Los Angeles), Jerry Hill (D-San Mateo), Alyson Huber (D-El Dorado Hills), Bonnie Lowenthal (D-Long Beach), Cameron Smyth (R-Santa Clarita) and Alberto Torrico (D-Fremont).
“Transparency and accountability are important principles at all levels of government, not just here at the state level,” Smyth said. “The situation in Bell illustrates the need for legislative action to eliminate opportunities for fraud, conflicts of interest, and other potential wrongdoing. I appreciate my colleagues moving quickly to address this significant issue, and I look forward to continuing to work with them in my capacity as Chair of the Assembly Local Government Committee.”
Authoring the bills in the package are Assemblymember De La Torre, Chair of the Assembly Committee on Accountability and Administrative Review, Assemblymember Huber, Chair of the Joint Legislative Audit Committee, Assemblymember Mike Gatto, Assemblymember Alberto Torrico as well as Senator Lou Correa, Chair of the Senate Committee on Public Employees and Retirement
“The City of Bell has brought to light the problem of local governments adopting salary and compensation agreements without adequate public disclosure,” De La Torre said. “Regardless of where people live, our local cities have a responsibility to be transparent about their contracts and expenditures. Local taxpayers have a right to know about it before they are forced to pay for it.”
“Government shouldn’t be done in the dark, plain and simple,” Huber said. “We have the ability to make more information available online than ever before yet our current system serves insiders more than it does every day Californians. AB 2064 requires all levels of government to make the salaries of elected and appointed officials publicly available on their websites.”
“We have all seen the escalating costs of public pensions put increased pressure on the budgets and well-being of state and local government,” said Torrico. “The malfeasance and abuse uncovered in the City of Bell only serves to further highlight the potential abuse of public pensions. The time to act is now. This is real and meaningful reform, which will have bi-partisan support and we hope will be signed by the Governor.”
“I was livid when I learned that the taxpayers of the City of Glendale would be on the hook for the irresponsible decisions made by the Bell City Council,” Gatto said. “This legislation would prevent that from occurring.”
“This measure provides a “one stop shopping” for the public and the press to know first hand what the compensation and employer costs are for those in the public trust, and those entrusted with the finances of their governmental agency,” State Senator Lou Correa said.
“The transparency and accountability in this package is something every Californian can get behind,” Lowenthal said. “I'm proud to join my bipartisan colleagues in advancing these critical reforms.”
Highlights of the reform package include:
- AB 1955 (De La Torre) Requires the Attorney General to determine whether a charter city is an excess compensation city (any one over the existing law compensation levels for general law cities). If after a hearing the AG determines that the city is an excess compensation city then the city would be prohibited from amending an old or approving a new redevelopment plan or issuing any new debt until the issue is resolved. The bill also requires that a city council person pay 50% personal income tax on any compensation received in excess of the existing law thresholds for general law city, if the charter city is found to be an excess compensation city. These provisions only apply to charter cities and exclude any full-time city council or independently elected mayor position. The bill also amends the Brown Act to require all contracts of employees who report directly to the legislative body to be approved in open session and requires that the contents of the compensation contract be posted on the local agency’s website 7 days prior to it being ratified in an open session.
- AB 827 (De La Torre) Would prevent “evergreening” clauses (no automatic renewal) in the contracts of unrepresented individuals who report directly to a legislative body of a local agency, prohibit automatic salary increases in these contracts, unless it is a cost-of-living adjustment, without the vote of a legislative body, and prohibit severance payments of greater than 12 months' salary for these non-represented employees. The measure would also require a performance review to occur prior to increasing the salary, beyond a COLA, of an unrepresented individual who reports directly to the legislative body of a local agency.
- AB 2064 (Huber) Requires each house of the Legislature to annually post on its official Internet Web site the annual salary for all Legislators and all Legislative employees. Requires all constitutional officers to annually post on their official Internet Web site the annual salary for the constitutional officer, any appointed or exempt deputies, and any appointed or exempt employees. Requires each general law or charter city, county, city and county, special district, school district, and JPA to annually post on its official Internet Web site the annual salary received from the local governmental entity by each elected or appointed official, and designated employees.
- AB 192 (Gatto) Would require a city, which seeks to lure a municipal employee from another city by offering an exorbitant raise, to pay for the higher pension payments that come with the raise. Under current law, the city where that employee worked for the majority of his or her career has to pay the pension at the level set by whatever city hires the employee. AB 192 would require that any city offering an employee greater than a 15% raise to pay for the associated difference in pension benefits.
- SB 501 (Correa) Requires each officer or designated employee 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. Defines "designated employee" and "officer" as a designated employee or an elected or appointed officer of a county, city, city and county, school district, special district, or JPA who is required to file a statement of economic interest pursuant to existing law.
- AB 194 (Torrico) Not withstanding any other law, for the purposes of determining a retirement benefit paid to a person who first becomes a member of a public retirement system on or after January 1, 2011, the maximum salary or payrate upon which retirement benefits shall be based shall not exceed 125 percent of the salary recommended to by paid to the Governor of the State of California by the California Citizens Compensation Commission effective December 7, 2009. This amount shall be adjusted annually based on changes in the All Urban California Consumer Price Index.
Website of Speaker John A. Pérez: www.asmdc.org/speaker
Website of Pro Tem Darrell Steinberg: http://dist06.casen.govoffice.com/
CONTACT: Shannon Murphy (Pérez) (916) 319-2408
CONTACT: Alicia Trost (Steinberg) (916) 651-4188
Below are links to audio from today’s event.
Speaker John A. Pérez’s opening remarks at today’s news conference. (2:02) mp3
Speaker Pérez says the Bell related legislative package is a bipartisan effort. (:11) mp3
Speaker Pérez says the Legislature should be dealing with issues such as the Bell related legislative package while work continues to settle the state budget deficit. (:23) mp3
Speaker Pérez says progress is being made on the budget but he understands the frustration of those affected by the budget crisis. (:27) mp3
Assemblymember Hector de la Torre says the legislative package will address three of the main issues raised by the City of Bell scandal. (1:12) mp3
Assemblymember Alyson Huber says her legislation will make it easier for the public to know what public officials are paid. (:38) mp3
Assemblymember Mike Gatto says his legislation will close a loophole that the City of Bell used to reap bigger pensions. (:29) mp3
Assemblymember Cameron Smyth says the bipartisan effort shows lawmakers can work together to solve problems. (:13) mp3