Loading...
HomeMy WebLinkAboutCOW 2003-04-14 Item 4E - Ordinance - Compensation for Future CouncilMeeting Date 4/14/03 Meeting Date 4/14/03 r COUNCIL AGENDA SYNOPSIS Initials I Meeting Date 1 Prepared by 1 Mayor's review 1 Council review 1 I 4/14/03 I_ I _.t.(i-' I e I I I �.I I I I I I I I I I I I I ITEM INFORMATION CAS Number: 03-050 I Original Agenda Date: 4/14/03 Agenda Item Title: Ordinance Fixing the Amount of Future Council Compensation ITEM No. Original Sponsor: Council x Admin. Timeline: Sponsor's Summary: This ordinance was written in the update of the Council operating procedures. It will remain in the TMC directly folkwing the procedures, but remain a separate ordinance for ease in amending in future years. Recommendations: Sponsor: Recommend ordinance for adoption Committee: Finance and Safety recommended ordinance April 8, 2003 Administration: Same as sponsor Cost Impact (if 2004- $12,540 _known) Fund Source (if known) 000 General Fund RECORD OF COUNCIL ACTION Action APPENDICES Attachments Memo from L. Lauterbach dated April 10, 2003 Draft Ordinance Fixing the Amount of Future Compensation Information memo; City Attorney Opinion 1/29/03; MSRC opinion 1/24/03 Ordinance 1956 r 1' rr nc> Gs- Sa fees .C minutes April 7, 2003 and March 3, 2003 To: Committee of the Whole From: Lucy Lauterbach Date: April 10, 2003 Subject: Council Compensation Ordinance In 2001 the Council passed Ordinance 1956, which set Council compensation levels for 2001- 2005. Future Council salaries and benefits for 2006 and 2007 were first discussed at the Council retreat, where a consensus decision was recommended to leave salaries unchanged for those two years. When Finance and Safety considered compensation, they agreed that benefits should be raised to the level of one employee's health insurance cost with the city. Checking with the City Attorney, I was told that benefits cannot be raised for the officials currently in office. Like compensation, the future benefits can be passed and then can be enjoyed by those in office after an election. The other issue was that the benefit cannot be nebulous as in "equal to the cost of an employee benefit It needs to be a specific amount of money. The benefit levels for 2004 were raised 11.76% ,which is close to the amount of increase for the employee health care costs over the past three years. For 2005 and 2006, the benefit was raised 10% per year, and kept there for 2007. I have included Ordinance 1956, which this replaces. It is not repealed here, as it was included in the repeals in the Council operating procedures. As you know, none of these increases will apply to Council until and unless you are elected. AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, AMENDING SECTION 2.04.230 OF THE TUKWILA MUNICIPAL CODE TO FIX THE AMOUNT OF COMPENSATION FOR COUNCILMEMBERS THROUGH 2007, REPEALING ORDINANCE 1956; PROVIDING FOR SEVERABILITY; AND ESTABLISHING AN EFFECTIVE DATE. WHEREAS, Ordinance 1956 set Council compensation levels for the years 2001 through 2005; and WHEREAS, Council members elected in 2003 will serve through 2007, and salaries for 2006 and 2007 are not set forth in Ordinance 1956; and WHEREAS, the City Council recognizes that the current economy warrants a conservative compensation that does not rise beyond the current scale; and WHEREAS, a uniform stipend ensures that all Council members receive the same salary for several years; NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, DO ORDAIN AS FOLLOWS: Section 1. Tukwila Municipal Code 2.04.230 is hereby amended to read as follows: A. Monthly compensation 1. Compensation levels. Pursuant to the provisions of RCW 35A.12.070, members of the Tukwila City Council shall receive the following monthly compensation during the years listed here according to their position and date their term of office commences: YEAR 2003 2004 1 2005 1 2006 1 2007 Council Members Salary.doc DRAFT POSITIONS 1, 3, 5, 7 Current Term of Office: 1/1102- 12/31/05 $950 /month $1,000 /month $1,050 /month *$1,050 /month $1,050 /month **New Council teen commences on Januany 1. POSITIONS 2, 4, 6 Current Term of Office: 1/1/04- 12/31/07 $685 /month 1 "$1,000 /month $1,050 /month $1,050 /month $1,050/ month 2. Compensation review. At any time the Tukwila Council compensation falls below the mean of the other Valley Communication cities, Tukwila will review the stipends and may increase its stipend to the level of those other cities. B. Benefits: Each member of the City Council, beginning January 1, 2003, shall be eligible for one of two benefits options: 1. Reimbursement program. Reimbursement from the City for medical expenses for one year including: pharmaceuticals, health care, alternative health care, dental, and vision costs; and health and life insurance premiums shall be authorized up to the following limits (which approximates the cost of insurance for one employee) during the years listed here, according to Councihnember position and date their term of office commences. YEAR 2003 2004. 2005 2006 2007 POSITIONS 1, 3, 5, 7 Current Term of Office: W02-12/31/05 $3,400/year $3,400/year $3,400/year Year $4,598/year POSITIONS 2,4, 6 Current Term of Office: W04-1201/07 $3,400/ year $4,180/ year $4,598/year $4,598/year New Council term commences on January 1. Reimbursements shall be made only upon presentation to the Finance Director of a receipt or other evidence that the expense was actually incurred. OR 2. Medical plan eligibility. Councilmembers have the ability to join the City's self-insured medical and dental plan which is offered to non-represented employees. This benefit will cover only the Councilmember and not additional family members, unless those are paid for separately. Section 2. Repealer. Ordinance Number 1956 is hereby repealed. Section 3. Severability. If any section, subsection, paragraph, sentence, clause or phrase of this ordinance or its application to any person or situation should be held to be invalid or unconstitutional for any reason by a court of competent jurisdiction, such invalidity or unconstitutionality shall not affect the validity or constitutionality of the remaining portions of this ordinance or its application to any other person or situation. Section 4. Effective Date. This ordinance or a summary thereof shall be published in the official newspaper of the City, and shall take effect and be in full force and effect on PASSED BY THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, at a Regular Meeting thereof this day of 2003. ATTEST/AUTHEN'TICATED: Jane E. Cantu, CMC, City Clerk APPROVED AS TO FORM BY: Office of the City Attorney Council Members Salary.doc Filed with the City Clerk: Passed by the City Council: Published: Effective Date: Ordinance Number: Steven M. Mullet, Mayor Information Memo The City Council will soon consider City Council salaries. To help in that discussion, here is information about the other Valley Communications System cities. That is the standard you set that you don't want to fall below the mean (average) of. These are all 2003 monthly stipends. City Council Stipend Mayor /Council Pres. Renton 950 Auburn 675 850 Federal Way 750 900 Kent 1,137 $1,198 Tukwila 685 950 The average of the other four cities is $878 without Tukwila's stipends being figured in. Federal Way is thinking of forming a citizen commission on Mayor /Council salaries, which is what Kent did. MICHAEL R. KENYON MARGITA A. DORNAY LISA M. MARSHALL ROBERT F. NOE BRUCE L. DISEND SANDRA S. MEADOWCROFT TO: City Council CC: Mayor Mullet John McFarland Alan Doerschel FROM: Bob Noe David St.Pierre, City Attorney's Office DATE: January 29, 2003 RE: Medical Expense Reimbursement for Council Members Council President Carter, through Lucy Lauterbach, has requested our opinion on whether or not there is any legal uncertainty "gray area over the question of whether Tukwila's council members may receive an increase in the amount of their direct reimbursement for medical expenses during their current terms of office, in Light of MRSC's opinion that council members cannot receive such an increase. It is our understanding that Tukwila council members may receive direct financial reimbursement from the city of up to $3,400 per year upon presentation of receipts for council member medical expenses. It is also our understanding that only one council member has opted to receive group medical insurance benefits from the city vice participating in this direct financial reimbursement plan. It is the direct financial reimbursement that is the subject of' this memorandum. GUIDANCE: It is our opinion that there is a low probability that legal uncertainty exists "i.e. no gray area as to the prohibition against Tukwila's council members receiving an increase in the amount of their direct reimbursement for medical expenses during their current terms of office. Though we believe MRSC's analysis of the question was flawed, it is our opinion that their conclusion was correct, but for other reasons. G: \City Attomey\ David \ME000I7- dbs.doc /COT /l/29/03 KENYON DORNAY MARSHALL, PLLC THE MUNICIPAL LAW FIRM 11 FRONT STREET SOUTH ISSAQUAH, WASHINGTON 98027 -3820 (425) 392-7090 (206) 628 -9059 FAX (425) 392 -7071 CITY OF TUKWILA MEMORANDUM SERVING WASHINGTON CITIES SINCE 1993 1 =r ELIZABETH A. ABBOTT STEVE C. KARI.MI STEPHEN R. KING HEIDI L. BROSIUS DAVID B. ST.PIERRE DARIN H. SPANG January 29, 2003 Page 2 ANALYSIS: Medical "expenses" of council members are "benefits" and not business related expenses, which can be fully reimbursed pursuant to council policies and state authority. Honne v. State, 78 Wn.2d 164, 469 P.2d 909 (1970). "Benefits" received by elected city officials are considered part of the elected officials "compensation." Id. Our state constitution prohibits elected municipal officers from increasing their compensation during their term of office. WA Const. Art. 11, Sec. 8. However, where the state legislature specifically declares a benefit to "not' be compensation, then the courts will not view any increase in such a benefit as a violation of the state constitution. AGO 1992 No. 8 and No. 8 Addendum (to Supreme Court Justice Talmage). RCW 41.04.190 was passed by the state legislature to allow local governments to take advantage of the cost savings associated with group insurance nolicies or plans when providing for benefits for their elected officials by declaring such costs `not' additional compensation for such elected officials. M. However, the legislature had the opportunity to declare direct reimbursement plans to "not" be compensation, but they did not take advantage of that opportunity. Our Supreme Court has stated that when a statute speaks in specific terms, an implication arises that omitted terms were not intended to be included within the scope of the statute: Under "expressio unius est exclusio alterius," a canon of statutory construction, to express one thing in a statute implies the exclusion of the other, i.e. omissions are deemed to be exclusions. In re Williams, 147 Wn.2d 476, 55 P.3d 597 (2002). Consequently, the declaration of what constitutes "not" compensation under RCW 41.04.190 applies specifically to group insurance policies or plans and not to other mechanisms such as direct reimbursement. We conclude that if the state legislature had intended that other such mechanisms, such as direct reimbursement, be declared "not" to be compensation then the legislature would have stated so. Because they did not so state, we conclude that the state legislature intended that local governments could take advantage of savings associated only with group insurance policies or plans and not other mechanisms, regardless of the similarity in financial cost to the city. Tukwila's direct reimbursement mechanism for council members is NOT a group insurance policy or plan. Regardless of the financial cost similarity between Tukwila's direct reimbursement mechanism for council members and council member coverage under a Tukwila group policy, the direct reimbursement mechanism constitutes compensation where coverage under a Tukwila group policy would not be compensation. Consequently, whereas increasing a council member's group policy coverage levels during that member's term in office would not be constitutionally proscribed, increasing a G1City Attomey \David \ME00017- dbs.dociCOT /01/29/03 January 29, 2003 Page 3 council member's amount of medical expense benefit through direct reimbursement is constitutionally prohibited. Finally, it is our opinion that the attached opinion of MRSC reached the correct conclusion but for the wrong reasons. First, it is obvious that MRSC did not understand that Tukwila's direct reimbursement mechanism for council members was not an insurance policy or plan. Consequently, MRSC was analyzing the wrong question. Second, MRSC's analysis (not prepared by MRSC's legal department) of the wrong question was flawed in our opinion and showed a lack of research into the recent (as of the year 2000) legal references (see AGO 1992 No. 8 and No. 8 Addendum). Thus, contrary to MRSC's analysis, it is our opinion that the single council member that opted to receive coverage under the Tukwila group insurance policy is NOT receiving compensation and that member's policy levels can be increased during that member's term of office without violating the state constitution. CONCLUSION: It is our opinion that Tukwila's council members are constitutionally prohibited from receiving an increase in the amount of their direct reimbursement for medical expenses during their current terms of office. It is also our opinion that there is a low probability that legal uncertainty exists "i.e. no gray area as to this prohibition. Welty Attorney\ David \ME00017- dbs,doc /COT /01/29/03 From: "Byron Katsuyama" <bkatsuyama @mrsc.org> To: <Ilauterbach @ci.tukwila.wa.us> Date: 1/24/03 10:21 AM Subject: MRSC Research Request Lucy, Here is a copy of the response that we gave to Alan Doerschel, Finance Director, Tukwila, in 2000: RE: Whether city councilmembers may receive during their current terms of office an increase in the amount of medical expense reimbursement. No, the proposed increase would be considered additional compensation, which may not be increased during the councilmembers' terms of office, regardless of how RCW 41.04.190 is interpreted. The proposed plan would increase the monetary amount for which councilmembers can be reimbursed for medical expenses such as pharmaceuticals, health care, dental and vision care, and health insurance premiums. RCW 41.04.190, amended in 1992, provides in relevant part as follows: The cost of a policy or plan to a public agency or body is not additional compensation to the employees or elected officials covered thereby. The elected officials to whom this section applies include but are not limited to commissioners elected under chapters 28A.315, 52.14, 53.12, 54.12, 57.12, 713.44, and 87.03 RCW, as well as any county elected officials who are provided insurance coverage under RCW 41.04.180. We have opined in the past that it is uncertain whether this applies to city elected officials. See, e.g., Inquiry No. 94 -0624, Richland. I contacted Brian Buchholz, assistant attorney general who advises the state auditor's office, to see if they had any new opinion an the issue of whether this statute applies to city elected officials. He opined, based on the final bill report contained in the 1992 Legislative Digest, that the 1992 amendment was intended to apply only to the elected officials of special districts. The statute references specifically only those RCW chapters dealing with special districts and the bill report states as part of the summary regarding the 1992 amendments (ESHB 1150. Ch. 146, Laws of 1992): The cost of group hospitalization and medical insurance coverage is not additional compensation for elected officials of special districts. So, it is probably best for MRSC to advise that this statute would likely not be interpreted to apply to city elected officials. Even if this statute were interpreted to apply to city elected officials. it would not apply in this instance because the city would not be paying for the cost of group hospitalization and medical JAN 2 7 2003 insurance coverage. Rather, it would be reimbursing for medical and other health care related expenses. We also note that the 2002 Washington Legislature considered but did not pass HB 2508 which would have extended the authorization in RCW 41.04.190 to city elected officials. While this is certainly not conclusive, it does support the interpretation that city officials are currently not included within the group of public officials referenced in RCW 41 .04.190. The basic legal issue is whether adding medical insurance benefits constitutes an unconstitutional mid -term increase in compensation. Article 2, section 25 of the state constitution states in relevant part: The legislature shall never grant any extra compensation to any public officer, agent, employee, servant, or contractor, after the services shall have been rendered, or the contract entered into, nor shall the compensation of any public officer be increased or diminished during his term of office. (Emphasis added.) Although this provision refers to action by the legislature, it has been interpreted by the courts to also apply to local government legislative bodies. See AGO 63 -64 No. 97, at 2, and cases cited therein. Article 11, section 8 does not apply here because it prohibits mid -term increases in salary, which is a narrower term than "compensation." See AGO 1992 No. 21. RCW 41.04.190 characterizes the "cost" of medical insurance to elected officials of counties and special districts, but not to city elected officials, as "not additional compensation," which means that the "cost" of such insurance is compensation for the latter. See Inquiry AGO 1974 No. 9 and AGO 1969 No. 2. In any case, our advice is that you discuss this with your city attorney. You may also want to discuss this further with one of our attorneys. I would suggest contacting Bob Meinig, MRSC Legal Consultant. I have spoken with Bob about your inquiry. I hope this helps. Byron Katsuyama Public Policy Consultant MRSC Visit our Web site! www.mrsc.org City of Tukwila Washington Ordinance No. ORDINANCE OF THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, AMENDING ORDINANCE NO. 1955 AND TUKWILA MUNICIPAL CODE 2.04.230, CLARIFYING THE LEVELS OF COMPENSATION FOR CITY COUNCILMEMBERS BY POSITION AND SCHEDULED TERM OF OFFICE; PROVIDING FOR SEVERABILITY; AND ESTABLISHING AN EFFECTIVE DATE. WHEREAS, Ordinance No. 1851, passed October 5, 1998, fixed the stipend and benefit levels for Councilmembers whose term of office commenced after that ordinance's effective date, to compensate them fairly for the time and effort required to be effe 've government officials; and WHEREAS, Ordinance No. 1955, passed April 2, 2001, established updated Council stipend levels for Councilmembers whose term of office would commence after that ordinance's effective date, based on the increased amount of time required and commensurate with the council stipends of comparable South King County cities; and WHEREAS, RCW 35A.12.070 states that any increase in the compensation attaching to an office shall not be applicable to the term then being served by the incumbent if such incumbent is a member of the city legislative body fixing his own compensation; and WHEREAS, the repeal of Ordinance No. 1851 by Ordinance No. 1955 rendered unclear the correct compensation level applicable to each Council position; NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, DO ORDAIN AS FOLLOWS: Section 1. Council Compensation. Ordinance No. 1955 and Tukwila Municipal Code Section 2.04.230 are hereby amended to read as follows: A. Monthly compensation. Pursuant to the provisions of RCW 35A.12.070, members of the Tukwila City Council shall receive the following monthly compensation during the years listed here according to their position and date their term of office commences: POSITIONS 1, 3, 5,7 POSmONS 2,4,6 1 i Current Term of Office: Current Term of Office: I YEAR 1/1/98 12/31/01 1/1/00- 12/31/03 2001 $563 $645 1 2002 *'$900 $665 2003 $950 $685 2004 $1,000 n $1,000 i 2005 $1,050 $1,050 "Nero Council tern commences on January 1. Com¢il Comp -darif 4 -01 1 B. Compensation review. At any time the Tukwila Council compensation falls below the mean of the other Valley Communication cities, Tukwila will review the stipends and may increase its stipend to the level of those other cities. Section 2. Severability. If any section, subsection, paragraph, sentence, clause or phrase of this ordinance or its application to any person or situation should be held to be invalid or unconstitutional for any reason by a court of competent jurisdiction, such invalidity or unconstitutionality shall not affect the validity or constitutionality of the remaining portions of this ordinance or its application to any other person or situation. Section 3. Effective Date. This ordinance or a summary thereof shall be published in the official newspaper of the City, and shall take effect and be in full force and effect five (5) days after passage and publication as provided by law. PASSED BY THE CITY COUbJC5. OF THE C OF TtJKWILA, WASHINGTON, at a Regular Meeting thereof this //a day of Clever.) ?001. Jle IV\ vV �V.Y,�.T Steven M. Mullet, Mayor ATTEST /AUTHENTICATED: (L7t E. Cantu, CMC, City Clerk APPROVED AS TO FORM: By Offtc(of the Ciii Attorney FILED WITH THE CITY CLERK: 7 PASSED BY THE CITY COUNCIL: /G A I PUBLISHED: 1 ZO -o EFFECTIVE DATE: I/- L5 ORDINANCE NO.: /y fl Council Comp clan /4 -01 2 nu�J Committee chair approval Finance Safety Committee April 7, 2003 5. Salary Ordinance The committee decided to separate the salary and benefit ordinance from the rest of the operating procedures. The agreed with the provisions in the draft ordinance setting 2006 and 2007 salaries as they had agreed to do earlier, and to add those years to benefits. Lucy explained the City Attorney had ruled that benefits are supposed to be added to Council salaries for income calculations. He has also said benefits cannot be raised for sitting Council members, but can for future elected officials. Recommend salary and benefit ordinance to COW and Council. c` Present: Joe Duffle, Chair; Jim Haggerton, Richard Simpson Alan Doerschel, John McFarland, Rhonda Berry, Lucy Lauterbach; Dennis Robertson 1. Lone Term Debt Schedule The Committee had asked to look at the city's long term debt. Alan summarized the bonds the City has, which now total $21 million, and another $11 million to be added this year. He pointed out the information is in the city's Annual Financial Report, which is done each year. Alan said there are two issues with debt: debt coverage and ability to pay the debt. He said the city can legally borrow $34 million more before needing to go to the voters for approval for more debt. The Community Center and Fire Station $4.4 m bond was sold in 1994; the 6300 building and Tukwila Village $9.1 m bond was in 1999; Valley Com's $2.3 m. bond was in 2000; and in 2003 will be an $11m. bond for the Golf Course Clubhouse, South Park Bridge, and Tukwila Village. There are also $4.6 m. Water /Sewer bonds, and a Public Works Trust Fund loan. Connectivity may be a future bond issue. Alan said according to bond counsel, if we can pay off about 65% in 10 years, the city is in good shape. In General Government we'll have about 60% paid off in 10 years, and with the Public Works bonds included, 64 Joe asked what would happen if we didn't pay our bond payments, and Alan said if you couldn't pay them, the city would go bankrupt, but that was unlikely. Information; inform Council at Plannine Model time. 2. Council Compensation Lucy said the Council operating procedures currently contains the Council compensation language, and asked if the committee would rather separate that from the rest of the procedures, and have a salary ordinance that stands by itself. Jim said he preferred to leave it in, and the others agreed. A second issue was to recommend a stipend level for the years 2006 and 2007. After discussion, the committee members agreed it should be left at the same level as 2005, which is $1,050/month. For benefits, which are currently $3,500 per year, they agreed it would be good to tie reimbursement levels to the amount the City pays for one employee's health insurance under the City plan. That level is about $4,200 in 2003. Reschedule draft ordinance. Committee Chair approval Finance and Safety Committee March 3, 2003