BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                       AB 215


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          ASSEMBLY THIRD READING


          AB  
          215 (Alejo)


          As Amended  May 4, 2015


          Majority vote


           ------------------------------------------------------------------- 
          |Committee       |Votes |Ayes                 |Noes                 |
          |                |      |                     |                     |
          |                |      |                     |                     |
          |----------------+------+---------------------+---------------------|
          |Education       |6-1   |O'Donnell, Kim,      |Chávez               |
          |                |      |McCarty, Santiago,   |                     |
          |                |      |Thurmond, Weber      |                     |
          |                |      |                     |                     |
          |                |      |                     |                     |
           ------------------------------------------------------------------- 


          SUMMARY:  Reduces the maximum cash settlement that may be paid to  
          a school district superintendent in the case of terminations of  
          employment.  Specifically for contracts of employment negotiated  
          on or after January 1, 2016.  Specifically, this bill:  


          1)Reduces the maximum cash settlement that may be paid to a school  
            district superintendent from 18 times the monthly salary to 12  
            times the monthly salary, unless the superintendent was  
            dismissed for cause, in which case the maximum cash settlement  
            is six times the monthly salary.










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          2)Reduces the maximum cash settlement that may be paid to a school  
            district superintendent in the case of a termination in which  
            the school district believes and subsequently confirms that the  
            superintendent has engaged in fraud, misappropriation of funds,  
            or other illegal fiscal practices from six times the monthly  
            salary to three times the monthly salary.


          FISCAL EFFECT:  Unknown.  This bill is keyed non-fiscal by the  
          Legislative Counsel.


          COMMENTS:  This bill reduces from 18 times the monthly salary to  
          12 times the monthly salary the maximum cash settlement that may  
          be paid to a school district superintendent whose employment has  
          been terminated.  In the case of a termination in which the school  
          district believes and subsequently confirms that the  
          superintendent has engaged in fraud, misappropriation of funds, or  
          other illegal fiscal practices, this bill reduces the maximum cash  
          settlement from six times the monthly salary to three times the  
          monthly salary.  In no case can the amount of the cash settlement  
          exceed the number of unexpired months on the contract.


          According to the California Department of Education (CDE) the  
          average annual salaries for unified school district  
          superintendents, by district size, in 2012-13 as follows:


          1)One hundred sixteen thousand six hundred six dollars for  
            districts with less than 1,500 average daily attendance (ADA);


          2)One hundred fifty-one thousand nine hundred twelve dollars for  
            districts with 1,500 to 4,999 ADA;


          3)One hundred eighty-three thousand five hundred fifty-seven  
            dollars for districts with 5,000 to 9,999 ADA;








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          4)Two hundred six thousand two hundred ninety-two dollars for  
            districts with 10,000 to 19,999 ADA; and


          5)Two hundred twenty-seven thousand one hundred eighty-three  
            dollars for districts with more than 20,000 ADA.


          There is considerable variance around these averages.  Information  
          provided by the author's office shows that the highest salaries  
          range from $265,773 to $322,159.  With salaries in this range, the  
          maximum cash settlement could range from $398,660 to $483,239  
          under existing law.


          Arguments in support.  The author's office argues that, "by  
          placing a cap on district superintendent's severance pay, we can  
          save money for students, begin to improve our school  
          administrative processes, and demonstrate fiscal discipline in the  
          administration of taxpayer dollars."  


          Arguments in opposition.  Opponents argue that superintendents are  
          at-will employees, who have no due process rights and can be  
          terminated any time without cause.  This action can end the career  
          of a superintendent.  Rather than being extra pay or a gift of  
          public funds, cash settlements are damages paid to a  
          superintendent "who is released by breach of contact."




          Analysis Prepared by:                                               
          Rick Pratt / ED. / (916) 319-2087  FN: 0000458











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