Proposition 1F
Elected Officials' Salaries. Prevents Pay Increases During
Budget Deficit Years.
Legislative Constitutional Amendment
Background
Salaries of Elected Officials. Salaries of the following elected officials are set by the California Citizens Compensation Commission, which was established in 1990 by Proposition 112:
Legislature (120 Members)
Governor
Lieutenant Governor
Attorney General
Controller
Insurance Commissioner
Secretary of State
Superintendent of Public Instruction
Treasurer
Board of Equalization (4 Members)
History. In1966, the voters approved a constitutional amendment converting California's part-time legislature (members paid at $6,000 per year) to a full-time legislative body (at $16,000 per year). The legislators were given the authority to raise their own salaries, by no more than 5 percent in any year. Since the passage of Proposition 6 in 1972, reduction in pay during a legislator's term in office has been prohibited. The Legislature's authority over its members' compensation ended in 1990.
California Citizens Compensation Commission. Proposition 112, adopted in the June 1990 election, grew out of efforts to reform legislative ethics. It banned honoraria and certain outside income, set limits on gifts and on travel, and transferred the authority to set legislative compensation to the newly-created California Citizens Compensation Commission. (The transfer was part of ethics reform, unrelated to budget considerations.) The commission also adjusts the salary and benefits of the other constitutional officers, listed above.
The commission consists of seven members appointed by the Governor, none of whom can be a current or former state officer or state employee. It establishes the annual salary, as well as medical insurance and other benefits for these officials, with certain exceptions. For example, members of the Legislature are eligible to receive per diem payments to cover expenses for each day of attendance at legislative sessions, but the level of per diem payments is set by another state board and not by the commission. In addition, under Proposition 140, members of the Legislature have been prohibited from earning state retirement benefits since November 1990. Accordingly, the commission has no control over these retirement benefits.
Factors Considered When Setting Pay and Benefits. Proposition 112 requires the commission to consider the following factors when it adjusts the annual salary and benefits of state officials: (1) time required to perform official duties, functions and services; (2) comparable salary and benefits for elected, judicial and private-sector officials with similar responsibilities; and (3) the responsibility and scope of the state office.
Proposition 6, passed by the voters in 1972, prohibits reducing the salaries of elected officials during their terms of office.
Based on past commission decisions, elected state officials are currently eligible to receive annual salaries ranging from $116,000 for legislators to $212,000 for the Governor.
The Proposal
Proposition 1F would amend the state Constitution to prevent the commission from approving salary increases in years when the state is expected to run a deficit.
Certification of a Deficit. On or before June 1 of each year, the state Director of Finance (an appointee of the Governor), would be required to notify the commission if the Special Fund for Economic Uncertainties, the state's traditional reserve fund, is expected to have a negative balance greater than 1 percent of the annual General Fund on June 30, the last day of the fiscal year. Currently 1 percent of General Fund revenues is almost $1 billion.
In years when the commission adjusts pay and benefits, it must act before June 30, with the adjustments taking effect in December. Proposition 1F requires that if a deficit has been certified, state officials will not be eligible to receive a salary increase to take effect in December of that year.
Fiscal Effect
Savings in Any Year Would be Minor. The commission does not grant pay raises every year and the level of increases is not always the same. Since January 2000, the commission has raised the pay of elected officials four times; total pay increases for each official have been equal to or less than the rate of inflation. Currently a 1 percent raise costs the state about $160,000. Should the commission recommend a 3 percent increase and be prevented by Proposition 1F from approving it, the state would save less than $500,000 that year.
Possible Effect on Budget Decisions. The Constitution requires the governor and the Legislature to adopt a balanced budget, but does not require that the budget be in balance at the end of a fiscal year. This measure may influence the governor and the Legislature to make different budgetary decisions--decisions that, for example, reduce a projected deficit or make it less likely that a deficit would emerge at all. The Legislative Analyst says these impacts are not possible to estimate.
What A Yes Or No Vote Means
A YES vote means that the state Constitution will prohibit the governor, members of the Legislature, and other elected officials from receiving pay raises when the state is running a deficit.
A NO vote means that the state Constitution will not require prohibiting pay increases when the state is running a deficit.
Supporters Say
- State officials should not have their salaries increased while services are being cut to save money.
- This change would save money and improve California's control over its finances.
- It would bring accountability to the Legislature and motivate elected officials to serve the public more responsibly.
Opponents Say
- This proposal would be ineffective and would only give the illusion of change. Nothing in it would change the ideologies of the officials who decide on the budget.
- Proposition 1F could at most save only a minor amount of money.
- The state budgeting process has structural problems that can only be solved by structural reform.
Support And Opposition
Ballot arguments in support are signed by State Senator Abel Maldonado; Lewis K. Uhler, President, National Tax Limitation Committee; and Joel Fox, President, Small Business Action Committee.
Ballot arguments in opposition are signed by Pete Stahl, Author.
PRO
Budget Reform Now
California Taxpayers Assocation
California Teachers Association
CON
Pete Stahl
California Federation of Teachers
National Association of Social Workers, California
For More Information
California Secretary of State
Legislative Analyst's Office
Campaign Finance Information
Ballotpedia
California Budget Project
EdSource
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