Brown Delivers Opinion on Legislative Pay Cuts
In response to a request from legislative leaders, Attorney General Edmund G Brown Jr. today concluded that the state Constitution allows the California Citizens Compensation Commission to reduce the salaries of legislators and other elected officials in the middle of their terms. Legislative leaders questioned the Commission's authority after it voted earlier this year to reduce the salaries of elected officials by 18 percent.
Brown pointed to the voters' 1990 approval of Proposition 112, which requires the Commission to 'adjust the annual salaries of state officers' each year, in confirming the Commission's authority to reduce salaries. According to Brown, Proposition 112 contradicts and supercedes a ballot measure adopted in 1972 that prohibited mid-term salary reductions.
Brown stated that 'any other interpretation would require assuming against all evidence that the voters in 1990 intended mid-term annual adjustments to only go up and never down, even in the face of a faltering economy and huge budget deficits.”
The full text of the letter follows:
Chief Executive Officer
Senate Rules Committee
Chief Administrative Officer
Assembly Rules Committee
Re: Mid-term Reduction of Legislative Salaries
In response to your question as to whether the California Citizens Compensation Commission can reduce the salaries of Legislators during their terms of office, the short answer is yes it can. This is because in 1990 the voters approved Proposition 112, which requires the Commission to “adjust the annual salaries of state officers . . . [which] shall be effective on or after the first Monday of the next December.” This provision supersedes and contradicts a previously adopted proposition that prohibited mid-term salary reductions. Any other interpretation would require assuming against all evidence that the voters in 1990 intended mid-term annual adjustments to go only up but never down, even in the face of a failing economy or huge budget deficits.
Your question requires resolving a conflict between two competing constitutional provisions. The first, Article III, section 4(a), which was added to the Constitution in 1972, states that “salaries of state elected state officers may not be reduced during their term of office.” The second, Article III, section 8(g), which was added to the Constitution by Proposition 112 in 1990, created the Commission and requires it to “adjust” the salaries of state elected officers (including legislators) before the end of each fiscal year. Those adjustments are effective on and after the first Monday of the December following the adjustment.
These two provisions conflict because an adjustment can be either an increase or a decrease. While Section 4(a) states that salaries cannot be reduced during a term of office, Section 8(g) states that salary adjustments (up or down) shall be made, and shall and be effective, annually. Requiring an annual adjustment in salaries is inconsistent with prohibiting salary reductions.
The rules of constitutional interpretation require harmonization of conflicting provisions if possible. If provisions cannot be reconciled, however, the later-adopted provision prevails. Because I believe that the two conflicting provisions cannot be reconciled, the later-adopted provision calling for adjustments up or down must prevail.
Having said that, I acknowledge that there are those who disagree, and I am aware of three legal opinions (including an informal opinion from an attorney in my Opinions Unit) that come to a contrary conclusion. However, the fundamental objective of statutory interpretation is to ascertain and effectuate the intent of the enacting body, which in this case is the voters. I believe that a careful review of the text of Proposition 112 and the accompanying ballot pamphlet makes clear that the voters intended in 1990 to create a new system of setting legislative compensation to include an annual up or down adjustment of salaries and benefits.
A. How Salaries Were Set Before the Adoption of Proposition 112 in 1990.
Before 1990 the salaries of elected state officers were set by statute. Two constitutional provisions also addressed the issue of salaries.
Former Article IV, section 4, dealt exclusively with the compensation of legislators. It required that salary adjustments be adopted by a two-thirds vote, not exceed five percent annually, and not go into effect until the next legislative session. Section 4(a) stated then, as it does now, “[e]xcept as provided in subdivision (b), salaries of elected state officers may not be reduced during their term of office.”
B. The 1990 Adoption of Proposition 112 and the Creation of the Compensation Commission.
Proposition 112, a legislative constitutional amendment, was adopted at the June 1990 primary election by a margin of 62% - 38%. Proposition 112 completely revised the procedure for setting the salaries of certain elected state officers. It created an appointed Commission to set the salaries of all elected state officers other than judges. The Commission was charged with the responsibility to set salaries annually:
[A]t or before the end of each fiscal year, the commission shall, by a single resolution adopted by a majority of the membership of the commission, adjust the annual salary and the medical, dental, insurance, and other similar benefits of state officers. The annual salary and benefits specified in the resolution shall be effective on and after the first Monday of the next December.
(Section 8(g) [as adopted by Proposition 112].)
Although the text of Proposition 112 repealed former Art. IV, § 4 concerning the setting of legislative salaries, it did not repeal Section 4(a), which states that the salaries of elected state officers “may not be reduced during their term of office.” The 1990 ballot pamphlet materials concerning Proposition 112 made no reference to Section 4(a).
C. The 2009 Adoption of Proposition 1F Modifying the Compensation Commission’s Procedures.
At the May 2009 special election, Proposition 1F was approved by a 74% - 26% margin. Proposition 1F amended Section 8(g) to prevent the Compensation Commission from raising the salaries of elected state officials in years where the General Fund is expected to end the year in a deficit. Section 8(g) was rewritten to put the language concerning the adjustment of salaries (as opposed to benefits) in a separate paragraph.
The new language concerning salary adjustments is identical to the old: It requires the Compensation Commission to adjust salaries annually and states that the adjustments “shall be effective” the following December. However, unlike the 1990 ballot pamphlet accompanying Proposition 112, the Analysis by the Legislative Analyst accompanying Proposition 1F noted the conflicting language of Section 4(a). The Analysis stated that “Proposition 6 – approved by voters in November 1972 – prohibits the reduction of elected state officials’ salaries during their terms of office.”
The rules of statutory and constitutional interpretation, while difficult to apply, are easy to state. “We begin with the fundamental premise that the objective of statutory interpretation is to ascertain and effectuate legislative intent.” “In the case of a constitutional provision adopted by the voters, their intent governs.” “The Court turns first to the words themselves for the answer[,]” and if the language is “clear and unambiguous” there is no need for construction or for resort to indicia of voters’ intent. “Words used in a constitutional provision should be given the meaning they bear in ordinary use.”
The language of Section 8(g), as adopted by Proposition 112 (1990) and amended by Proposition 1F (2009), makes clear that increases and decreases in salaries were meant to go into effect annually:
Thereafter, at or before the end of each fiscal year, the commission shall adjust the annual salary of state officers by a resolution adopted by a majority of the membership of the commission. The annual salary specified in the resolution shall be effective on and after the first Monday of the next December[.]
(Emphasis added.) When a salary is adjusted, it can go either up or down. (The American Heritage Dictionary defines “adjust” as “1. To change so as to match or fit; cause to correspond[.]”) An adjustment becomes effective when it becomes operative. (The American Heritage Dictionary defines “effective” as “3. Operative; in effect: The law is effective immediately.” [Emphasis in original].) Thus the constitutional dictate is that the Compensation Commission pass a salary resolution before the end of each fiscal year, and that the resolution become effective the following December.
While the language of Section 8(g) is clear, the inquiry does not end there. Section 8(g) must be read in the context of the entire Constitution, and particularly Section 4(a), which states that the salaries of elected state officers may not be reduced during their term of office. Proposition 112 – which added Section 8(g) to the Constitution – could have amended Section 4(a), but it did not. Section 8(g)’s silence regarding its effect on the pre-existing section 4(a) creates a latent ambiguity because “the law shuns repeals by implication[.]” Statutes “must be read together and so construed as to give effect, when possible, to all the provisions thereof.” However, where two enactments present an unavoidable conflict, the most recent expression of legislative will prevails. A later-adopted provision works an implied repeal of an earlier provision where “two acts are so inconsistent that there is no possibility of concurrent operation, or where the later provision gives undebatable evidence of an intent to supersede the earlier[.]”
Because Section 8(g) is ambiguous in context, it is appropriate to look to the ballot pamphlet for evidence of voters’ intent in adopting Proposition 112. The ballot pamphlet supports the conclusion that Section 8(g) was intended to completely revise the existing law concerning the setting of salaries of elected officials. The Title and Summary of Proposition 112 informed voters that the newly-created Compensation Commission would establish salaries annually and that previous law would be repealed:
Repeals current provisions setting salaries, benefits of legislators, elected statewide officials; establishes seven-member Commission, appointed by Governor, to annually establish salaries, benefits.
The Analysis of the Legislative Analyst stated:
Creates the California Citizens Compensation Commission with the exclusive authority to set the annual salaries, and the medical, dental, insurance, and other similar benefits of Members of the Legislature and [other elected state officials].
* * * * *
The commission would have until December 3, 1990, to set the salaries and benefits which would be effective for one year beginning on that date.
In the following years, the commission could adjust annually the salaries and benefits for elected state officers.
The Rebuttal to Argument Against Proposition 112 added that:
The Commission is NOT a guaranteed pay raise. The opponents didn't tell you that the Commission has the power to lower salaries.
(Emphasis in original.) To summarize, voters were told that current law concerning the setting of salaries would be repealed, that the Commission created by Proposition 112 would have exclusive authority to set salaries, that the Commission’s initial determination would be effective for one year beginning December 3, 1990, that thereafter the Commission could adjust salaries annually, and that the Commission could raise or lower salaries.
Based on the language of Proposition 112 and the accompanying ballot pamphlet text, I am convinced that voters cannot be presumed to have created a one-way street up for salaries. Voters must have believed that the Commission would have the exclusive power to adjust salaries up or down, that salaries would be adjusted annually, and that those adjustments would be effective annually. As a result, I see no way that section 8(g) can be harmonized with section 4(a). Accordingly, section 8(g) must control because it is more recent.
Kennedy Wholesale, Inc. v. State Bd. of Equalization (1991) 53 Cal.3d 245 is probably the closest case on point. Kennedy Wholesale concerned the interpretation of Proposition 13, which amended the State Constitution to state that “any changes in State taxes enacted for the purpose of increasing revenues . . . must be imposed by an Act passed by not less than two-thirds of all members elected to each of the two houses of the Legislature[.]” The issue was whether this language meant that only the Legislature could enact new taxes, so as to work an implied repeal of the voters’ power to raise taxes by statutory initiative. The Supreme Court concluded, for two reasons, that there was no implied repeal: First, a court must resolve any doubts in favor of the “precious right” of initiative. Second, “Nothing in the official ballot pamphlet supports the inference that voters intended to limit their power to raise taxes[.]” In the context of the present dispute over legislative salaries, both of these reasons support the conclusion that Section 8(g) does impliedly repeal Section 4(a). Section 8(g) does not restrict the right of initiative. And the ballot pamphlet clearly supports the conclusion that Section 8(g) was intended to supplant Section 4(a).
One other statutory-interpretation issue merits mention. Section 8(g) was amended by Proposition 1F (May 2009). The accompanying ballot pamphlet included a statement from the Legislative Analyst that “Proposition 6 – approved by voters in November 1972 – prohibits the reduction of elected state officials’ salaries during their terms of office.” Thus, voters in the 2009 May special election were informed of the conflict between Section 8(g) and Section 4(a). This does not change my conclusion that the voters in 1990 intended to permit the Commission to reduce Legislators’ salaries during legislative terms because Proposition 1F did not in any way purport to amend the relevant text of section 8(g) instructing the Commission to “adjust” salaries annually and makes those adjustments “effective on or after the first Monday of the next December[.]”
In my opinion, there is an unavoidable conflict between Section 8(g) (1990) and Section 4(a) (1972). Because Section 8(g) was adopted most recently, I believe that it controls and gives the Commission authority to reduce salaries mid-term.