HomeMy WebLinkAbout2006-07-26 STAFF REPORTS 2L O�pAI.M Sp?
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DATE: July 26, 2006 Consent Calendar
SUBJECT: Council and Commission Members Expense Reimbursement Policy
as Required by AB 1234
FROM: David H. Ready, City Manager
BY: Assistant City Manager— Administralive Services
SUMMARY
On January 1, 2006 Assembly Bill (AB 1234) went into effect. This bill requires
cities to establish written expense reimbursement policies for city officials. Such
policies must state what types of occurrences qualify a city official to receive
reimbursement of expenses and place limits on the amounts of expenses that
may be reimbursed without prior City Council approval. In addition to establishing
a written expense policy, this bill also requires ethics training of city officials. This
action would approve a resolution establishing expense guidelines and
reimbursement policy for City Council and Commission Members to comply with
the requirements of AB 1234.
RECOMMENDATION:
1. Adopt Resolution No. "A RESOLUTION OF THE CITY COUNCIL OF
THE CITY OF PALM SPRINGS, CALIFORNIA ESTABLISHING EXPENSE
GUIDELINES AND AN EXPENSE REIMBURSEMENT POLICY FOR CITY
COUNCIL AND COMMISSION MEMBERS."
STAFF ANALYSIS:
On October 10, 2006, Governor Schwarzenegger approved Assembly Bill 1234
(AB 1234), which imposes ethics training, and compensation and reimbursement
requirements on cities, counties and special districts. This legislation took effect
January 1, 2006.
Generally, AB 1234 requires local agency officials to receive no less than two
hours of training in general ethics principles and ethics laws every two years. The
ITEM NO.
Expense Reimbursement Policy
Page 2 of 4
bill allows officials to fulfill this requirement by taking courses developed in
consultation with the Fair Political Practices Commission and the Attorney
General. For purposes of this policy, "public official" is defined as any member of
the City Council and/or member of a City commission, committee, board or other
body of the City, whether permanent or temporary, decision-making or advisory,
created by ordinance, resolution, or formal action of the City Council.
At a minimum, the ethics training must cover the following topics:
• Personal financial gain by public servants;
• Conflict of interest, bribery and nepotism;
• Gift, travel and mass-mailing restrictions;
• Honoraria, rinancial interest disclosure and competitive bidding;
Prohibitions on the use of public resources for personal or political
purposes;
• The Brown Act; and
Public Records Act.
The City may develop its own ethics training course and include its own ethics
policies in the curriculum or contract with an outside educational provider to
satisfy the ethics training requirement. If the City elects to do its own training, it
must first submit its curriculum to the State Attorney General and the Fair
Political Practices Commission for approval.
Staff is working on scheduling ethics training for the City Council and
Commission members through the Institute for Local Government. This training
will likely be held in either October or November. Once a date has been
confirmed, staff will notify the Council and all Commission members. In addition
to the training staff is working on, there is a self-study course offered through the
Institute for Local Government. Several organizations including the League of
California Cities currently offer ethics training for elected officials. The League
will provide several sessions on ethics during their annual conference in San
Diego in September.
Apart from imposing ethics training requirements, AB 1234 also places certain
limitations on how members of legislative bodies may be compensated for
attending meetings and reimbursed for travel, lodging, and meals. Under the bill,
a local agency is only authorized to compensate its legislative body members for
attending the following: (i) meetings of the governing board, (ii) meetings of
advisory bodies, and (iii) conferences. The local agency is prohibited from
providing compensation for attending other types of meetings unless those
meeting are included within a written policy adopted by its legislative body.
AB 1234 also restricts the manner in which legislative body members are
reimbursed for travel, lodging, and meal expenses. Specifically, AB 1234
provides that "if a local agency reimburses its legislative body members for actual
Expense Reimbursement Policy
Page 3 of 4
and necessary expenses incurred in the performance of official duties," then the
local agency is required to adopt a written policy specifying the types of
occurrences (e.g., conferences) that qualify a legislative body member for
reimbursement of expenses relating to travel, meals, lodging, and other actual
and necessary expenses. AB 1234 would also require legislative body members
seeking reimbursement for travel, lodging, and meals to file an expense report.
These expense reports must then be completed, submitted within a "reasonable
time" after incurring the expense, and be accompanied by receipts. Additionally,
members have to provide a "brief' report on meetings attended at the expense of
the local agency at the next regularly scheduled meeting of the legislative body.
AB 1234's reimbursement policy applies to "legislative bodies" as that term is
defined in the Ralph M. Brown Act. The reimbursement policy may establish its
own reimbursement rates. Otherwise, the Internal Revenue Service
reimbursement rates apply. The policy may also define the types of meetings
and events for which legislative body members may be reimbursed or provided
per diem or compensation for their attendance. However, AB 1234 requires that
conference lodging costs cannot exceed the maximum group rate available at the
time of booking. Additionally, if group or government rates are available, then the
agency must use them. Any requests for reimbursements that are not
specifically covered by an agency's policy must be approved in a public meeting
before the expense is incurred.
Finally, the new law states that all documents related to reimbursable agency
expenditures are subject to the Public Records Act. AB 1234 also references
possible penalties for the misuse of public resources or falsifying expense
reports. These penalties may include: loss of reimbursement privileges,
restitution to the local agency, civil penalties up to $1,000 a day, and felony
prosecution under Penal Code Section 424. To better understand all of the
implications of this new law, the Institute for Focal Government has prepared a
list of frequently asked questions concerning AB 1234. A copy of these
frequently asked questions is attached.
There is some debate whether AB 1234 applies to charter cities. A number of
attorneys argue that expense reimbursement falls under the category of
"compensation" which is typically a right granted to charter cities and not subject
to state regulations. Since there is no case law on this issue it is difficult to say
whether charter cities would be exempt from the requirements of this bill.
Without a clear exemption from these requirements, the City Attorney's Office
believes that it would be prudent for the City to adopt an expense reimbursement
policy consistent with AB 1234. To this end, the City Attorney's Office has
prepared a draft resolution establishing an Expense Guidelines and
Reimbursement Policy which conforms to the requirements set forth in AB 1234.
Expense Reimbursement Policy
Page 4 of 4
As a whole, the proposed guidelines and reimbursement policy would have the
following effects:
• All Council expenditures must follow normal City procedures for the
purchase of goods and services, including attendance at conferences and
other similar events.
• Travel, lodging, and meals at educational events may be reimbursed at
the IRS rates presently in effect as long as a report is made to the Council
after the event.
• Attendance at functions of local, civic, and community organizations may
be reimbursed where the primary subject matter of the event relates to the
City's business. This language is designed to make more explicit the
principle that such expenditures serve a municipal purpose and involve
the actual and necessary expenses of office.
• Attendance at entertainment, recreational or cultural events, likewise,
would not be paid from City funds.
The proposed policy applies to both reimbursed and directly paid expenses and
is modeled after the sample policy developed by the Institute for Local
Government. Expenditures for all other activities not covered by the proposed
policy would require advance approval by the City Council, must meet an
articulated municipal purpose that must be recited in the report proposing the
expenditure, and be approved by a resolution authorizing the expenditure and
reciting that municipal purpose.
FISCAL_ IMPACT:
Although this was not a budgeted expense within the current fiscal year, adoption
of the proposed resolution is not likely to have a significant financial impact.
There will be some cost associated with the ethics training that needs to be
provided to City Council and Commission Members.
iwx,
L. Butzlaff, I ant City Manager David H. Ready,
r
Attachment:
1. Frequently Asked Questions Concerning AB 1234
2. Resolution
3. Exhibit"A" Reimbursement Guidelines and Expense Policy for City Council and Commission
Members
LOCAL Ci, VERN ENS'
rvuNoen��,
AB 1234's Requirements vis-a-vis
Expense Reimbursement:
Frequently Asked Questions
Revised 413106 Draft
1. What, in a nutshell, does AB 1234' require in the area of expense reimbursement?
AB 1234 contains certain requirements and restrictions on local agency practices relating to
reimbursing local elected and appointed officials' expenses. AB 1234 requires local agencies
to:
• Adopt expense reimbursement policies that specify the kinds of activities that will
be reimbursable;2
• Identify a "reasonable time" within which requests for reimbursement must be
submitted in those policies;3
Use expense report forms; and
Require that all expenses must be documented with receipts4 (these documents
are public records subject to disclosure5).
AB 1234 says that such a reimbursement policy may specify what constitutes reasonable rates
for travel, meals, lodging and other expenses. If a local policy does not specify reimbursement
rates, then the reimbursable rates default to those in the Internal Revenue Service guidelines-6
If a legislative body member wants to seek reimbursement for levels of expenses not otherwise
authorized under the agency's reimbursement policy, then the official may seek prior approval
for such reimbursement from the governing body (before incurring the expense). 7
Note there may be clean-up legislation that clarifies that local officials have the option of
' Chapter 700, Statutes of 2005.
2 Cal. Gov't Code § 532322(b).
5 Cal. Gov't Code § 53232.3(c).
4 Cal, Gov't Code § 53232.3.
5 Cal. Gov't Code § 53232.3(e).
5 Cal. Gov't Code§ 53232.2(r).
7 Cal. Gov't Code § 53232.2(f).
personally paying for the difference between what an agency will reimburse and actual
expense incurred-8
2. How broadly defined is the term "reimbursement"?
AB 1234 does not define "reimbursement." However, the usual rule of statutory construction is
that, when a term is not defined, the ordinary dictionary definition applies.9 According to the
American Heritage Dictionary, 'reimburse" means to.
1. To repay (money spent); refund.
2. To pay back or compensate (another party) for money spent or losses incurred.
Thus, strictly speaking, AB 1234 only applies to those circumstances under which elected and
appointed officials (for example, members of boards and commissions) seek payment from an
agency for expenses incurred in the course of their service to the agency.
3. Does AB 1234's restrictions, or the policies adopted pursuant to AB 1234, apply to
expenses which are not reimbursed but are incurred by local agencies in the first
instance (for example, on the agency's credit card)?
No. The local agency has the option, of course, of adopting policies that apply to those kinds
of expenses or drafting its AB 1234 policies broadly enough to cover expenses incurred as well
as expenses for which reimbursement is sought. But AB 1234 does not require them to do so.
4. Which agencies must adopt reimbursement policies?
Any local agency that reimburses any of its elected and appointed officials on legislative
bodies for expenses must adopt a policy.10 Local agency includes "a city, county, city and
county, charter city, charter county, charter city and county, or special district."" The
definition of"legislative body" is tied to the Brown Act definition of legislative body (see text in
note below12).
6 See SE 1196 (Senate Local Government Committee Omnibus Bill).
q See People v. Siravo, 17 Cal.App. 4th 555, 560, 21 Cal. Rptr. 2d 350, 362 (2d Dist. July 27, 1993), rev. denied
(Oct. 21, 1993). See also City of Berkeley V. Cukierman, 14 Cal. App. 4th 1331, 1339, 1340, 18 Cal. Rptr. 2d
478, 481, 482 (1st Dist. 1993) (noting words of a statute must be given their ordinary meaning and looking initially
to a dictionary for that meaning).
10 Cal. Gov't Code § 53232.2(b).
11 Cal, Gov't Code § 53232(c).
12 Government Code section 54952 provides in that regard.
As used in this chapter, 'legislative body" means:
(a)The governing body of a local agency or any other local body created by state or federal statute.
(b)A commission, committee, board, or other body of a local agency, whether permanent or temporary,
decisionmaking or advisory, created by charter, ordinance, resolution, or formal action of a legislative
body. However, advisory committees, composed solely of the members of the legislative body that are
less than a quorum of the legislative body are not legislative bodies, except that standing committees of a
legislative body, irrespective of their composition, which have a continuing subject matter jurisdiction, or a
Again, the tie to "local agency" as defined in the bill, means that AB 1234's requirements on
reimbursement policies do not apply to some kinds of agencies on which local officials serve
(for example, redevelopment agency governing boards or joint powers agencies), although of
course voluntarily adopting expense reimbursement policies is a prudent course of action for
non-covered entities. It also does not apply to school districts.
5. Is there a place where we can find sample reimbursement policies?
Yes, at www.ca-il .or /ab1234com liance . Keep in mind, however, that there is no one-size-
fits-all approach to such policies and AB 1234 specifically allows local agencies to tailor their
policies to their communities' needs and standards.
6. Does AB 1234's restrictions apply to expenses incurred by local agency staff?
No. AB 1234's requirements relating to expense reimbursement policies and restrictions on
reimbursement rates only apply to "reimbursements of members of a legislative body.03 For
consistency and ease of administration, some local agencies have elected to adopt policies
that govern expense reimbursements for staff as well as elected and appointed officials, but
AB 1234 does not require local agencies to do so.
7. What are the IRS rates for meal expenses?
The Internal Revenue Service establishes "per diem" thresholds for employees; any amounts
in excess of the per diem for a given area is treated as additional wages for income tax
purposes. For example, for 2006, the standard per diem rate for meals (breakfast, lunch and
meeting schedule fixed by charter, ordinance, resolution, or formal action of a legislative body are
legislative bodies for purposes of this chapter.
(c) (1) A board, commission, committee, or other multimember body that governs a private corporation,
limited liability company, or other entity that either:
(A) Is created by the elected legislative body in order to exercise authority that may lawfully be
delegated by the elected governing body to a private corporation, limited liability company, or other
entity.
(B) Receives funds from a local agency and the membership of whose governing body includes a
member of the legislative body of the local agency appointed to that governing body as a full voting
member by the legislative body of the local agency.
(2) Notwithstanding subparagraph (B) of paragraph (1), no board, commission, committee, or other
multimember body that governs a private corporation, limited liability company, or other entity that
receives funds from a local agency and, as of February 9, 1996, has a member of the legislative body
of the local agency as a full voting member of the governing body of that private corporation, limited
liability company, or other entity shall be relieved from the public meeting requirements of this chapter
by virtue of a change in status of the full voting member to a nonvoting member.
(d)The lessee of any hospital the whole or part of which is first leased pursuant to subdivision (p) of
Section 32121 of the Health and Safety Code after January 1, 1994, where the lessee exercises any
material authority of a legislative body of a local agency delegated to it by that legislative body whether
the lessee is organized and operated by the local agency or by a delegated authority.
a Cal. Gov't Code § 53232.2(b).
dinner) and incidental expenses in the continental United States is $39. However the rate for
Los Angeles, San Francisco, and San Diego areas (as defined) is $64.14
AB 1234 gives local agencies latitude to adopt whatever standards for meal reimbursements
that meet community standards.
Local officials sometimes want to know what the state's practices are in terms of
reimbursements. Senators and Senate employees, for example, are reimbursed according to
the federal government's General Services Administration's rates by geographic area; the web
address for these rates is:
http://www asa gov/Portal/gsa/ep/contentView.do?gue_ryYear=2006&contentT e=GSA BASI
C&contentld=17943& ue State=California&noc=T_
Note that, under AB 1234, officials must still present receipts documenting expenses incurred,
even if they are within the guidelines adopted by the IRS or the local agency.
8. If there are no mandatory reimbursement rates, is there no limit on what local
officials may be reimbursed for?
The law specifies certain thresholds for what constitutes reasonable levels of expenses. For
example, for lodging in connection with conferences, the rate may not exceed the maximum
group rates published for the conference.15 If those rates are not available at the time the
lodging is booked, the lodging rates must be comparable to those allowed by the Internal
Revenue Service or government rates.16 Local agency officials must use group or government
rates for non-conference-related lodging and transportation services.17
But otherwise, AB 1234 retains agencies' discretion, subject to community standards relating
to the judicious use of scarce taxpayer dollars.
9. When must these reimbursement policies be adopted? What do we do about
reimbursing expenses before we adopt the policies contemplated by AB 1234?
These reimbursement policies should be adopted as soon as possible. AB 1234 took effect
January 1, 2006.
Agencies should not reimburse expenses until they have a policy in place. An option is to ask
their officials to retain any receipts for reimbursable expenses until the policy can be adopted
and then submit their reimbursement requests consistent with those policies and AB 1234's
requirements.
14 See Publication 1542 at www.irs.gov or www.policmorks.gov/perdiem.
15 Cal. Gov't Code § 53232.2(d).
is Id.
17 Cal. Gov't Code§ 53232.2(e).
10.May local agencies grant car allowances or other expense allowances under AB
1234?
This is a very good question on which agency attorneys disagree. Some agency attorneys
believe that AB 1234's requirement that expenses be reimbursed after the fact based on
receipts means that vehicle and other expense allowances are not permitted.18 Some local
agencies had previously reimbursed auto expenses through an allowance, based on statute
and case law19 that seemed to permit allowances when based on empirically demonstrable
information that the allowance matched actual and necessary expenses incurred.20
A factor to keep in mind with expense allowances is that they may be taxable (and subject to
withholding) if the official cannot document that his or her actual expenses met or exceeded
the allowance.21 This, and the requirement that any expense allowance be based on empirical
information about actual expenses incurred, predate AB 1234's requirements.
11.11E an agency has a current reimbursement policy, does AB 1234 require that it
develop another policy if the current policy omits one of the identified items, like
travel, meals, or lodging?
Agencies should consult with agency counsel to make sure that any existing policies comply
with AB 1234's specific requirements.
12.WIhat about expenses related to cell phone and Internet use for local agency
business?
These also can be reimbursed according to local agency policy with documentation.22 In terms
of kinds of documentation, one agency requires that telephone bills be submitted and that the
official identify which calls were made on agency business. For cellular calls when the official
has a particular number of minutes included in the official's plan, then the agency asks the
official to identify the percentage of calls made on public business. For Internet access, if the
officials submit an estimate of the percentage of agency-related usage for the period in
question and proof of the amount of bill for such access.
Officials should keep in mind that all expense reimbursement requests and supporting
documentation are public records_23
16 Cal. Gov't Code § 53232.3.
19 See Cal. Gov't Code § 1223 (authorizing local officials to "contract"for an allowance or mileage rate for
automobile owned, rented or used in performance of duties), Citizen Advocates, Inc. v. Board of Supervisors, 146
Cal. App. 3d 171, 194 Cal, Rptr. 61 (1983).
20 See Albright v. City of South San Francisco, 44 Cal. App. 3d 866, 118 Cal. Rptr. 901 (1975).
21 Tress. Regs. § 1.62-2T(e), § 1.3401(a)-1T.
21 Cal. Gov't Code§ 53232.3(c).
2s Cal. Gov't Code § 53232.3(e).
13.How should local agencies interpret the requirement for members of a legislative
body to provide brief reports on the meetings they attended at the expense of the
local agency at the next regular meeting of the legislative body?
AB 1234 requires members of a legislative body to report on "meetings" attended at public
expense at the next meeting of the legislative body.24 "Meetings" for purpose of this section
are tied to the Brown Act meaning of the term:25 any congregation of a majority of the
members of a legislative body at the same time and place to hear, discuss, or deliberate upon
any item that is within the subject matter jurisdiction of the legislative body or the local agency
to which it pertains.26
An example would be when a city council member or supervisor represents his or her agency
on a joint powers agency board and pays for the official's expenses in serving in that
representative capacity.
Presumably the report can be either written or oral. The report must be made at the next
meeting of the legislative body that paid for its member to attend the meeting.27
Note too that some public agencies have also voluntarily adopted requirements that any time
an official attends a conference or similar gathering at public expense that a report be provided
back to the body. Again, the report typically can be written or oral.
14.Can AB 1234's requirements for expense reimbursement be constitutionally applied
to charter cities?
A number of charter city attorneys argue that expense reimbursement falls under the category
of "compensation" over which charter cities have plenary authority to the exclusion of state
regulation.28 Indeed, the portion of AB 1234 relating to expense reimbursement is part of a
new article being added to the Government Code entitled "Compensation."29
Of course individual charter requirements and good fiscal management practices may make
voluntary adoption of the kind of expense reimbursement policy contemplated by AB 1234
advisable. The Institute's sample reimbursement policy includes a suggested finding for
charter cities stating that the reimbursement policy would satisfy AB 1234's requirements in the
event such requirements could be constitutionally applied to charter cities.
2d Cal. Gov't Code§ 53232.3(d).
25 Cal. Gov't Code§ 53232.3(d).
25 See Cal. Gov't Code § 64952.2.
7
7 Cal. Gov't Code § 53232.3(d).
28 Cal. Const. art. XI, § 5. County of Sonoma v. Commission on State Mandates, 84 Cal. App. 4th 1264 (2000).
29 Article 2.3 of chapter 2 of Part 1 of division 2 of title 5 of the Government Code.
15. What are the penalties for misuse of public resources or falsifying expense
reports?
Penalties for misuse of public resources or falsifying expense reports in violation of expense
reporting policies include:3o
• Loss of reimbursement privileges
• Restitution to the local agency
• Civil penalties of up to $1,000 per day and three times the value of the resource used31
• Criminal prosecution and a lifetime bar from public office32
Note that these potential penalties existed under the law prior to AB 1234.
G.\Lega1\INSTITUTE\Puhhc Conhdenec\AB 1234-2006 Ethics Laws\FAQs\expense 1 mmhuncmenL Fucis doe
4I3M06
3o See Cal. Gov't Code§ 53232.4.
3' See Cal. Gov't Code§ 8314.
32 See Cal. Penal Code §424.
RESOLUTION NO.
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
PALM SPRINGS, CALIFORNIA ESTABLISHING EXPENSE
GUIDELINES AND AN EXPENSE REIMBURSEMENT
POLICY FOR CITY COUNCIL AND COMMISSION
MEMBERS.
WHEREAS, the City Council of the City of Palm Springs takes its stewardship over the
use of its limited public resources seriously; and
WHEREAS, public resources should only be used when there is a substantial benefit to
the City; and
WHEREAS, such benefits include, but are not limited to:
1. The opportunity to meet with state and federal officials to discuss issues
and matters that may affect City interests;
2. Participating in regional, state, and national organizations whose activities
may affect the City;
3. Attending educational seminars designed to improve the expertise and
information levels of City Council and Commission Members; and
4. Promoting public service and morale by recognizing such service; and
WHEREAS, Assembly Bill 1234, which became effective January 1, 2006, requires any
local agency that reimburses members of a legislative body for actual and necessary
expenses incurred in the performance of official duties to adopt a written policy
specifying the types of occurrences that qualify a member of the legislative body to
receive reimbursement of expenses relating to travel, meals, lodging, and other actual
and necessary expenses; and
WHEREAS, as a matter of policy, the City should bear the cost of the actual and
necessary expenses incurred by City Council and Commission Members, which include
City Council members, Planning Commission members, Parks and Recreation
Commission members, and other City Commission, Committee, and Board members, in
the performance of their official duties;
WHEREAS, the City Attorney has drafted an expense reimbursement policy to provide
guidance to City Council and Commission Members on the use and expenditure of
public resources for expense reimbursements made on behalf of City Council and
Commission Members who incur authorized expenses in the performance of officials
duties, as well as the standards against which those expenditures will be measured;
and
WHEREAS, this expense reimbursement policy applies to both reimbursed expenses
and expenses advanced or directly paid by the City on behalf of City Council and
211001 1
Resolution No.
Page 2
Commission Members that may incur such expenses in Lhe course of performing their
official duties.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF PALM SPRINGS,
CALIFORNIA, RESOLVES:
SECTION 1. Pursuant to new Government Code Sections 53232.2 and 53232.3, which
law became effective January 1, 2006, the City of Palm Springs hereby establishes
expense guidelines and an expense reimbursement policy for the City Council and
Commission Members, which is attached hereto as Exhibit "A" and is incorporated
herein by reference.
PASSED, APRROVED, AND ADOPTED at a regular meeting of the City Council of the
City of Palm Springs held this day of 2006.
Ron Oden, Mayor
ATTEST:
James Thompson, City Clerk
21 1 001 1 2
Resolution No.
Page 3
CERTIFICATION
STATE OF CALIFORNIA )
COUNTY OF RIVERSIDE ) ss.
CITY OF PALM SPRINGS )
I, JAMES THOMPSON, City Clerk of the City of Palm Springs, hereby certify that
Resolution No. _ is a full, true and correct copy, and was duly adopted at a regular
meeting of the City Council of the City of Palm Springs on
by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
James Thompson, City Clerk
City of Palm Springs, California
2 L I001 1 3
EXHIBIT "A"
CITY OF PALM SPRINGS
EXPENSE GUIDELINES AND REIMBURSEMENT POLICY
FOR
CITY COUNCIL AND COMMISSION MEMBERS
The City Council of the City of Palm Springs believes that it is important that elected
officials protect public resources and foster public trust in the use of those resources.
Further, the City Council believes that the public is best served by officials that remain
informed and trained in issues affecting the affairs of the City and that attendance at
institutes, hearings, meetings, conferences, or other gatherings is of value to the City
and its citizens.
In order to uphold the public's confidence in their elected and appointed officials and to
comply with the spirit of state law regarding reimbursement of expenses, the City
Council does hereby set forth the expense guidelines and reimbursement policy for the
City Council and Commission Members.
A. AUTHORIZED EXPENSES
The following types of occurrences qualify any of the City's City Council and
Commission Members, which include City Council members, Planning Commission
members, Parks and Recreation Commission members and any other City Commission,
Committee, and Board members, to receive reimbursement for expenses incurred in the
performance of officials duties relating to travel, meals, lodging, and other actual and
necessary expenses that constitute authorized expenses, provided the requirements of
this policy are met'
(1) Communicating with representatives of regional, state, and national
government on issues or matters affecting the City or on City adopted
policy or political positions;
(2) Attending conferences and/or educational seminars designed to improve
the member's expertise and information levels, including, but not limited
to, ethics training required pursuant to Government Code Section 53234;
(3) Participating in regional, state, and national organizations whose activities
or interests may affect the City's interests;
(4) Attending City sponsored or co-sponsored events or other community
events;
(5) Implementing a City-approved strategy for attracting or retaining
businesses to the City; and
(6) The performance of other such official duties in the interest of the City.
1
aunni i
Exhibit"A"
Pagc 2
The following expenses require prior City Council approval:
(1) Out-of-state or international travel; and
(2) Expenses which exceed any annual limits established for each member.
All other reimbursement expenses that are not specifically authorized by this policy shall
be approved by the City Council in a public meeting before the expense is incurred.
Examples of personal expenses that the City will not reimburse include, but are
not limited to:
(1) The personal portion of any trip taken at City expense;
(2) Political contributions or events;
(3) Travel companion expenses, including spouse, friend, or partner
expenses when accompanying a member on City-related business, as
well as children- or pet-related expenses;
(4) Charitable contributions;
(5) Social or other recreational events, unless the event has a direct
relationship to City business;
(6) Entertainment expenses, including theater, movies (either in-room or at
the theater), sporting events (including gym, massage, and/or golf related
expenses), or other cultural events;
(7) Non-mileage automobile expenses incurred, including repairs, traffic
citations, insurance, or gasoline; and
(8) Personal losses incurred while on City business (e.g., theft or property
destruction).
Any questions regarding the propriety of a particular type of expense should be resolved
before the expense is incurred-
B. EXPENSE AND REIMBURSEMENT GUIDELINES
To conserve City resources and keep expenses within appropriate standards for
public agencies, expenditures, whether paid directly by the City or reimbursed to a
member of the City's legislative bodies, should comply with the following guidelines.
Unless otherwise specifically provided herein, reimbursement for travel, meals, lodging,
and other actual and necessary expenses shall be at the Internal Revenue Service rates
presently in effect as established in Publication 463 or any successor publication. All
expenses not covered by this policy, or which are in excess of the reimbursable rates set
forth in this policy, shall not be reimbursable unless approved by the City Council at a
public meeting before the expense is incurred.
211001 1 2
Exhibit"A"
Page 3
1. Transportation
The most economical made and class of transportation reasonably consistent
with scheduling needs and space requirements must be used, using the most direct and
time-efficient route. In the event that a more expensive transportation form or route is
used, the cost borne by the City will be limited to the cost of the most economical, direct,
efficient, and reasonable transportation form. Government and group rates offered by a
provider of transportation services shall be used when available.
Automobile mileage is reimbursable at Internal Revenue Service rates presently
in effect (see www.irs.gov). These rates are designed to compensate the driver for
gasoline, insurance, maintenance, and other expenses associated with operating the
vehicle. This amount does not include bridge and road tolls, which are also
reimbursable.
Reasonable and necessary charges for public transportation, taxi, or shuttle
service are reimbursable at actual cost with receipts.
Rental vehicles may be used during out-of-county travel. Rental vehicles may be
used when the efficient conduct of City business preludes the use of other means of
transportation or when a car rental is the most economical mode available. Itemized
receipts must be submitted with vehicle rental reimbursement requests.
2. Lodging
Lodging costs will be reimbursed or paid for when travel on official City business
reasonably requires an overnight stay. Government and group rates offered by a
provider of lodging services shall be used when available.
If such lodging is in connection with a conference or organized educational
activity, lodging costs shall not exceed the maximum group rate published by the
conference or activity sponsor, provided that lodging at the group rate is available to the
member at the time of booking. If the group rate for lodging in connection with a
conference or organized educational activity is not available, the member shall use
comparable lodging that is: (a) consistent with the Internal Revenue Service rates for
reimbursement of lodging as established by IRS Publication 463, or any successor
publication; or(b) at a government rate, if offered by a lodging provider.
Non-reimbursable lodging-related expenses include, but are not limited to, costs
for an extra person staying in the room, costs related to late check-out or uncancelled
reservations, in-room pay-per-view movie rentals or mini-bar service, and non-City
business related telephone calls. Receipts must accompany all member requests for
lodging reimbursements.
3. Meals
Meal expenses and associated gratuities should be moderate, taking into
account community standards and the prevailing restaurant costs of the area. Actual
meal expenses and associated gratuities will be reimbursed or paid when incurred by
the member in the performance of official duties.
211001.1 3
Exhibit"A"
Page 4
4. Telephone / Fax/ Cellular
City Council and Commission Members will be reimbursed for actual telephone
and fax expenses incurred on City business. Telephone bills should identify which calls
were made on City business. For cellular calls when the member has a particular
number of minutes included in the member's calling plan, the member can identify the
percentage of calls made on City business.
5. Airport Parking
Long-term airport parking should be used for travel exceeding 24-hours. Actual
airport parking expenses and associated gratuities will be reimbursed or paid when
incurred by the member in the performance of official duties.
6. Other
Baggage handling fees of up to $2 per bag and gratuities of up to 15 percent will
be reimbursed or paid when incurred by the member in the performance of official
duties.
Miscellaneous expenses for registration, tuition, parking, educational materials
provided at conferences and telephone charges are reimbursable for City authorized
business. All miscellaneous expenses must be supported with itemized receipts.
Expenses for which members receive reimbursement from another agency are
not reimbursable.
C. EXPENSE REPORT CONTENT AND SUBMISSION DEADLINE
Expense reports must document that the expense in question meets the
requirements of this expense reimbursement policy.
Members must submit their expense reports within sixty (60) days of an expense
being incurred, which shall be accompanied by receipts documenting each expense.
Restaurant receipts, in addition to any credit card receipts, are also part of the necessary
documentation. Receipts for gratuities and tolls under`b5 are not required.
All documents related to reimbursement under this policy, except as redacted to
maintain the privacy of certain personal financial data (such as credit card numbers),
shall be subject to disclosure under the California Public Records Act.
D. AUDITS OF EXPENSE REPORTS
All expenses are subject to verification of compliance with this policy.
E. BRIEF REPORTS TO LEGISLATIVE BODY
At the following meeting of the legislative body, members shall briefly report on
any meetings attended at the City's expense. If multiple members attended the meeting
at City expense, a joint report may be made to the legislative body.
mni i 4
Exhibit"A"
Page 5
F. COMPLIANCE WITH LAWS
Members should keep in mind that some expenditures may be subject to
reporting under the Political Reform Act and other laws. All documents related to
reimbursable agency expenditures, including, but not limited to, expense reports,
receipts, and written evidence of direct City advances or payments for expenses, are
public records subject to disclosure under the Public Records Act.
znom i 5