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CC - ACTION ITEM: (1) Discussion Regarding City Council Compensation; and (2) Direction to the City Manager as Deemed Appropriate
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Meeting Date: September 9, 2024
Contact Person/Dept: Lisa Soghor/Finance
Heather Baker/City Attorney
Phone Number: 310-253-5865
310-253-5660
Fiscal Impact: Yes [] No [X] General Fund: Yes [] No [X]
Attachments: []
Public Notification: (E-Mail) Meetings and Agendas - City Council (09/03/2024)
Department Approval: Lisa Soghor (08/29/2024); Heather Baker (08/29/2024)
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RECOMMENDATION
Staff recommends the City Council (1) discuss City Council compensation; and (2) provide direction to the City Manager as deemed appropriate.
BACKGROUND/DISCUSSION
On April 29, 2024, the City Council directed staff to return with an agenda item to discuss City Council Compensation.
Current Council Member Compensation
Section 603 of the Culver City Charter states, in pertinent part that, “Council Members shall receive compensation for their services in accordance with the provisions of State law.”
State law, Government Code Section 36516, authorizes a city council to adopt an ordinance establishing a salary based on a city’s population. In 2023, the state law related to City Council compensation was amended with the passage of SB 329 (<https://legiscan.com/CA/text/SB329/id/2832037>), which increased compensation thresholds, provided a methodology for future increases, and listed limited guidelines for determining salaries. Based on SB 329, for cities over 35,000 up to and including 50,000 in population, such as Culver City, the salary may be initially established up to and including $1,275 per month.
The current council member compensation was effectuated by Ordinance No. 91-021, adopted on September 10, 1991, which amended Culver City Municipal Code (CCMC) Section 3.01.005 to establish the salary for each council member at $485.10 per month effective May 1, 1992. No further salary increases have been adopted to date.
Options for Increasing Council Member Compensation and Other Benefits
• Ordinance: Pursuant to Government Code Section 36516(a)(4), the City Council could amend the CCMC to increase the amount of compensation up to the greater of either of (1) 5% for each calendar year from the operative date of the last adjustment; or (2) an amount equal to inflation since January 1, 2024, based upon the California Consumer Price Index, which shall not exceed 10% for each calendar year. No ordinance may include automatic future increases.
The calculation of the 5% increase for each calendar year from the operative date of the last adjustment may not be compounded, according to a 2006 Attorney General Opinion:
<https://oag.ca.gov/system/files/opinions/pdfs/06-504.pdf>
The increase must be based on what the actual salary is, not on what it could have been had increases been adopted each year. In other words, the City may not apply the 5% to the currently received salary amount for the first year, and then apply it to the newly calculated amount for the second year, and so on. Therefore, the calculation for the permissible increase in this scenario would be the following:
$485.10 x 5% = $24.255
$24.255 x 32 calendar years = $776.16 (permissible increase)
Under this option, the City Council could direct staff to return with an ordinance amending the CCMC to increase a council member’s salary from $485.10 per month up to and including $1,261.26 per month.
• Ballot Measure: Pursuant to Government Code Section 36516(b), an increase to council member compensation beyond the salary cap provided for in Section 36516(a) may be submitted to the voters and must pass by a majority of the electors voting in favor of the measure. If the City Council wishes to increase a council member’s salary above $1,261.26 per month, the proposed increase would have to be placed on a future ballot at any municipal election (general or special).
• Participation in Deferred Compensation Program: Pursuant to Government Code Section 36516(d), “[a]ny 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.”
At this time, there has been no deferred compensation program authorized and established for city council members. If the City Council wishes to participate in deferred compensation, it may provide that direction to the City Manager and City staff will return with more detailed information and options for such a program.
Applicable Conflict of Interest Regulations
Pursuant to Government Code Section 87100, a public official may not make, participate in making, or in any way attempt to use their official position to influence a governmental decision in which they know or have reason to know they have a financial interest. An official has a “financial interest” within the meaning of Section 87100 if it is reasonably foreseeable that the decision will have a material financial effect, distinguishable from its effect on the public generally, on the official or on other specified sources of economic interest, such as sources of income or their personal finances or those of their immediate family. (Government Code Section 87103.) “Salary. . . received from a state, local, or federal government agency” are excluded from “sources of income.” (Government Code Section 92030(b)(2).) Similarly, a “salary…the public official…receives from a federal, state, or local government” is excluded as “personal finances” unless “the decision is to… set a salary for the official…which is different from salaries paid to other employees of the government agency in the same job classification or position…” (Cal. Code Regs., tit. 2, § 18705.5(b); emphasis added.)
All Council Members would benefit equally from any proposed increases. As such, all Council Members may participate in this agenda item.
FISCAL ANALYSIS
There is no fiscal impact associated with the discussion of this item. Fiscal impacts will be evaluated based on the direction of the City Council.
ATTACHMENTS
None.
MOTIONS
That the City Council:
1. Discuss City Council compensation; and
2. Provide direction to the City Manager as deemed appropriate.