In an update to responses related to the salary scandal in Bell, the legislature is considering two bills that would require greater disclosure. There is SB501, which would require local government employees to report their compensation figures and the information would be placed on a web site. Benefits, reimbursement payments and other perquisites would also have to be disclosed under this potential law. Then there is AB1955, which would put a limit on the amount that employees in charter cities can make. While cities for the most part have been on board with reforms, there has been criticism voiced about putting restrictions on salaries for charter cities, citing questions of legality. Under AB1955, cities would also be subject to financial penalties if officials are provided “excessive” pay. The LA Times has a round-up of the proposals here.
As for Bell, continued investigating has revealed that the city loaned more than $1.5 million to city employees. For instance, former City Administrator Robert Rizzo was given two loans of $80,000 and assistant city manager, Angela Spaccia, received two loans of at least $100,000 each. Several city officials who received loans did not disclose the loans on state financial disclosure forms for 2009, which is required by state law. The LA Times reports:
“Artiga said Rizzo told him some employees used the loans to buy homes. Hernandez did not return calls seeking comment. Bell's new city manager said it appeared that at least 50 people received loans in the last eight years. At least some appeared to have been repaid. ‘Currently our city attorney has questioned their legality,’ City Manager Pedro Carrillo said. ‘What we're investigating is who authorized it, why and how does he approve it.’ The loan terms varied in length. Some were repaid over years, others were open-ended, Carrillo said. The collateral appeared to be unused vacation time, sick leave and pensions. City officials said no credit checks were conducted. The interest rate was tied to a fund managed by the state treasurer.”For a city to have such a loan program for its employees is unusual, according to public finance experts. Read more here. CalPERS has also announced that it is taking measures to address the pay scandal with the following actions: Posting audit reviews of public agency membership and payroll data submitted to the retirement system; highlighting significant findings of public agency reviews and regularly report them to the CalPERS Board; and establishing procedures and guidelines for CalPERS working-level staff to notify supervisors and senior management of unusually high compensation and salary increases such as those that occurred in Bell.
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