08-20-07 Agenda Item 2D, City Council Compensation

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. The question also raises the issue of a council binding a future council by its actions. It is generally accepted that, except in certain situations, a council may not take action to draft or enact a policy that will unduly bind the actions of a future council. See, A.G. Op. 217- B-7 (July 13, 1945) (attached). Since the statute requires a council to set salaries "in such amount as they deem reasonable," each council should be allowed to exercise its individual assessment of what is reasonable. If an ordinance allows for an automatic increase, a subsequent council is stripped of its authority to assess for itself the reasonable value of the work they provide while in office. 2. Per diem pay. There are no statutes that specify how Council Members may be paid. Some cities pay an annual or monthly amount, while others pay on a per-meeting basis. This type of per- meeting policy is different than per diem pay. Among statutory cities, only Iron Range cities have statutory authority to make per diem payments up to $25 per day, not to exceed $250 per year, for absences from the city while on official city business. Minn.Stat. ~ 415.10. If a non-Iron Range city wants to pay council members a per diem for expenses incurred while away from the city on city business, the council should first consider that there are strict IRS guidelines about per diem pay and carefully weigh how to handle implementing a policy providing for per diem pay. Here, I believe the question is more about how to compensate council members for their seNice in office. There is no authority prohibiting the council from passing a salary ordinance which provides that council members will be paid for each meeting that they attend. However, this can be problematic. For example, if the ordinance establishes payment for meetings attended, unless the ordinance includes a specific definition of "meeting," issues could arise about compensation for attendance special or emergency meetings, meetings of other city bodies, meetings out in the community, etc. In short, the Council has discretion in making a decision about how much and by what method they are to be compensated for their seNice in office. However, the Council's decision must be reflected in the form of an ordinance, and, like enacting a change in amount of pay, the salary adjustment ordinance cannot become effective until after the next succeeding municipal election. If you have any further questions on these issues, or would like to discuss them further, please feel free to let me or Jerry know.