A new salary contract bill takes effect in less than a month, and ACSA has been fielding questions as to what changes it will make for schools.
Assembly Bill 1344, Feuer, D-Los Angeles, stipulates that beginning Jan. 1, any new employment contract or renewal of a contract is prohibited from containing an automatic renewal that provides for an automatic increase in the level of compensation that exceeds a COLA.
The bill was a reaction to the inflated salary and pension scandal that took place last year in the City of Bell. Although AB 1344 was originally introduced regarding city charter elections, various amendments brought about permutations that impact school districts, as well as cities, counties, special districts and other groups.
ACSA Legislative Advocate Laura Preston worked hard to get the bill’s author to incorporate language in the bill recognizing the difference between city and governmental agencies and school districts. No other local governmental entities or statewide education organizations opposed the bill.
“I was particularly concerned that the language of AB 1344 would have a different impact on school districts than traditional local government, since department heads have a different meaning in a city than they do in a district,” Preston said.
Preston involved legal counsel in the hopes of addressing potential problems in the legislation, but none of the language she proposed was accepted by Assemblyman Mike Feuer.
“After extensive discussions with legal counsel, we finally came to the conclusion that while ACSA didn’t like the bill, it is fairly limited in scope,” she said. “In light of the Bell scandal and the heightened sensitivity to a perceived lack of transparency by local governments, the Legislature was interested only in tightening down on evergreen-type contracts.”
But as the bill’s implementation date approaches, more school districts are asking what the actual effect will be in the way they do business.
“The bill applies to the chief executive officer of a local agency,” Preston said. “In the case of schools this would be the superintendent. It also applies to a person who is the head of a department of the local agency, which for schools could be a deputy, assistant or associate superintendent or other department heads that are not part of a represented employee group.
“The key in the latter is whether they have a contract or not. Many school leaders below the level of superintendent do not have a separate contract with the district, so the provisions of the bill would not apply.”
AB 1344 defines compensation to include an annual salary or stipend; automobile and equipment allowances; incentives and bonus payments; and payment in excess of the “regular” benefits the district provides for all other employees. In addition, AB 1344 would prohibit a cash settlement for an executive, including a school superintendent, which exceeds the 18 months of salary plus benefits currently allowed under statute.
Preston also noted that a governing board is prohibited from calling a special meeting to approve a contract for a superintendent or others who fall under the parameters of the bill. Regularly scheduled board meetings and following all of the Brown Act provisions are required for the meeting where a new contract or renewal is adopted. AB 1344 cannot and does not abrogate an existing contract.
Finally, the bill adds procedures to replace local agency resources should the chief executive officer be found guilty of a felony that is tied to his or her position. Additional language will need to be added to a new or renewed contract that provides for reimbursement of any paid leave if the chief executive officer is convicted of a crime involving an abuse of his or her position; funds for the legal criminal defense should he or she be found guilty; and regardless of the term of a contract, any cash settlement for an early termination of a contract tied to the conviction of a felony.
“The bill maintains the current 18-month buyout of your contract, including salary and benefits, should the need occur,” Preston said. “However, if there is an additional payment or bonus tied to it above the 18-month salary and benefits, then the provisions of AB 1344 apply.”
Preston warned that while she can inform ACSA members of the bill’s intent, that information should not replace guidance by a school district’s attorney. Contact Preston at firstname.lastname@example.org.