Item No. 16.
TO:HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM:OFFICE OF THE CITY ATTORNEY
BY:ALICIA DUARTE, CITY CLERK
JOHN M. FUNK, CITY ATTORNEY
DATE:APRIL 28, 2026
SUBJECT:DISCUSSION OF AMENDMENT TO CITY CHARTER REGARDING COMPENSATION FOR
CITY COUNCIL MEMBERS
EXECUTIVE SUMMARY
The City Council will discuss and determine an amendment to the City Charter regarding compensation for City Councilmembers to be submitted to Downey voters for their consideration at the November 3, 2026 general municipal election.
RECOMMENDATION
That the City Council:
1. Discuss and determine whether to place an amendment to the City Charter regarding compensation for City Councilmembers to be submitted to Downey voters for their consideration as a separate ballot measure at the November 3, 2026 general municipal election; and,
2. For any Charter amendment approved for voter consideration, provide direction to City Staff to prepare the elections resolutions necessary to place the Charter amendment on the ballot.
BACKGROUND
At the City Council meeting on March 24, 2026, the Council directed the preparation of an amendment to the City Charter regarding compensation for City Councilmembers for their service on the Council. The Charter currently provides that members of the City Council are not compensated for their service but are entitled to reimbursement for authorized travel and, by ordinance, other out-of-pocket expenses related to their duties. City Ordinance No. 06- 1186 governs reimbursement for such out-of-pocket expenditures. For any amendment to the Charter, majority voter approval is required under state law.
At its meeting on December 9, 2025, the Council approved another Charter Amendment that will be submitted to the voters at the November 3, 2026 election. This Charter Amendment, covering a number of topics and making various technical updates, was recommended by the Charter Review Ad Hoc Committee and is proposed under separate action to appear as a single measure on the November 3, 2026 ballot. If so directed, any Charter amendment concerning Council compensation would be presented to Downey voters as a separate ballot measure apart from the earlier proposed charter amendment. This item grew from the Council's discussion regarding reimbursement on March 24, 2026. As directed by the Council, the proposed new amendment under consideration would provide compensation in the amount of $1,000 per month but not alter the reimbursement provisions.
DISCUSSION
Section 502 of the City Charter addresses compensation for City Councilmembers. In its entirety, Section 502 provides:
Section 502. COMPENSATION.
The members of the City Council shall receive no compensation for their services as such, but shall receive reimbursement on order of the City Council for Council authorized traveling and other expenses when on official duty. In addition, members shall receive such reasonable and adequate amounts as may be established by ordinance, which amount shall be deemed to be reimbursement to them of other out-of-pocket expenditures and costs imposed upon them by virtue of their serving on the City Council.
The Downey City Charter
The City of Downey is governed through a Charter authorized by the California Constitution. The Charter is a foundational document that establishes a degree of "home rule" autonomy over state law regarding municipal, or local, affairs. The Charter is the City’s own constitution; like the state and federal constitutions, it is a statement of basic principles, outlining powers, relationships, and responsibilities.
A charter may only be adopted, amended, or repealed by a majority vote of a city’s voters. The primary advantage of a charter is that it affords greater local autonomy for a city’s governance than provided by general state law. For example, a charter city may tailor its organization and elective offices, considering the unique local conditions and priorities of the community.
Downey first instituted a charter form of government in 1964, eight years after the City was incorporated in 1956.
Since the Charter’s inception in 1964, there have been 14 amendments considered by the voters, 11 of which have passed. Section 502 appeared in the original City Charter and has not been altered since then.
Governing Law on City Council Compensation
For cities not governed by a charter (known as "general law" cities), state law supplies the legal framework for council compensation. Section 36516 of the Government Code authorizes a City Council to enact a ordinance to provide each of its members a salary, with a maximum limit based upon the population of the city. Those limits, which were increased in 2024 pursuant to Senate Bill 329, are as follows:
POPULATION MAXIMUM MONTHLY
SALARY
Up to and including 35,000 $950
Over 35,000 up to and including
50,000 $1,275
Over 50,000 up to and including
75,000 $1,600
Over 75,000 up to and including
150,000 $1,900
Over 150,000 up to and including
250,000 $2,550
Over 250,000 $3,200
SB 329 also authorizes councilmember salaries to be increased beyond the specified maximum in an amount not exceeding the greater of either 5% for each calendar year from the operative date of the last adjustment of the salary or an amount equal to inflation since January 1, 2024, based on the California Consumer Price Index (not to exceed 10% per calendar year). An SB 329 ordinance may not provide for automatic future increases.
Charter cities are not subject to SB 329 though they may elect to be bound by its salary limitations when setting compensation for their councilmembers. The charter cities of Anaheim, Bellflower, Seal Beach, and Santa Ana are local examples of this. Other local charter cities set their own local council compensation rules, including Cerritos and Vernon, and are not so limited by SB 329, as is their right as a charter city. Further, a charter city many provide for automatic increases in compensation because it is not subject to SB 329.
Charters often allow compensation to be established through an implementing council ordinance. Alternatively, a charter may itself specify the precise amount of compensation. In this case, such a provision is self-executing and there is no need for an ordinance. The City Council expressed its preference for the latter approach, though all options are presented below for consideration, where deletions are marked by strikeout and additions by bold underline.
If compensation is fixed in the Charter, it could be amended only by voter approval (i.e., a future charter amendment). If the amount is set by implementing ordinance, the City Council could determine the amount from time to time through regular ordinance adoption procedures. Regardless of how compensation may be established, if it is allowed, a member of the City Council may elect to waive compensation at any time during the member's service.
Option No. 1: Monthly Salary Amount Fixed by Charter
Section 502. COMPENSATION.
The members of the City Council shall receive no compensation for their services in the amount of $1,000 per month as such, but and shall receive reimbursement on order of the City Council for Council authorized traveling and other expenses when on official duty. In addition, members shall receive such reasonable and adequate amounts as may be established by ordinance, which amount shall be deemed to be reimbursement to them of other out-of-pocket expenditures and costs imposed upon them by virtue of their serving on the City Council. Compensation shall not be subject to annual or periodic adjustment. This provision shall become effective upon the first day of the first month occurring after the effective date.
Option No. 2: Monthly Salary Amount Fixed by Charter and Adjusted for Inflation
Section 502. COMPENSATION.
The members of the City Council shall receive no compensation for their services in the amount of $1,000 per month as such, but and shall receive reimbursement on order of the City Council for Council authorized traveling and other expenses when on official duty. In addition, members shall receive such reasonable and adequate amounts as may be established by ordinance, which amount shall be deemed to be reimbursement to them of other out-of-pocket expenditures and costs imposed upon them by virtue of their serving on the City Council. Compensation shall be adjusted on July 1 of each year equivalent to the percentage change in the annual average of the Consumer Price Index as published by the United States Department of Labor for the Los Angeles-Long Beach-Anaheim metropolitan area. This provision shall become effective upon the first day of the first month occurring after the effective date.
Option No. 3: Monthly Salary Amount Fixed by Implementing Council Ordinance
Section 502. COMPENSATION.
The members of the City Council shall receive no compensation for their services in such amount as the City Council may by ordinance approve from time to time as such, but and shall receive reimbursement on order of the City Council for Council authorized traveling and other expenses when on official duty. In addition, members shall receive such reasonable and adequate amounts as may be established by ordinance, which amount shall be deemed to be reimbursement to them of other out-of-pocket expenditures and costs imposed upon them by virtue of their serving on the City Council.
Option No. 4: Monthly Salary Amount Fixed by Ordinance and Limited by SB 329
Section 502. COMPENSATION.
The members of the City Council shall receive no compensation for their services in such amount as the City Council may by ordinance approve from time to time as such, but and shall receive reimbursement on order of the City Council for Council authorized traveling and other expenses when on official duty. In addition, members shall receive such reasonable and adequate amounts as may be established by ordinance, which amount shall be deemed to be reimbursement to them of other out-of-pocket expenditures and costs imposed upon them by virtue of their serving on the City Council. Any ordinance fixing compensation shall be limited by the provisions of Sections 36516 of the California Government Code governing compensation for general law city council salaries, or any successor provision thereto.
Tax Treatment of Council Compensation
Under IRS guidelines, current council reimbursement payments are reported as wages on IRS Form W-2. This is because the reimbursements are not based on receipts but rather established by ordinance in a lump sum, in accordance with Section 502. Council compensation would be reported in the same fashion.
Timeline and Resolutions to Submit Charter Amendment to Voters The California Elections Code requires that the City Council adopt a resolution to submit a ballot measure amending the Charter to voters at least 88 days in advance of the respective election. For the election scheduled for November 3, 2026, this means that the resolution concerning a council compensation ballot measure must be adopted no later than the July 28, 2026 regular City Council meeting (note that the City Council is not scheduled to meet on July 14).
Two additional procedural resolutions would be necessary. One is to request Los Angeles County to consolidate the City’s election with the Statewide General Election. The other is to provide for the filing of primary and rebuttal arguments regarding the Charter amendment ballot measure. These resolutions are largely boilerplate and would be considered concurrently with the above resolution calling for the placement of the charter amendment.
Form of Ballot Measure
As directed by the City Council on March 24, 2026, the proposed charter amendment regarding council compensation is intended to be presented to voters as a separate ballot measure at the November 3, 2026 election. The other Charter amendment covering several topics is being scheduled for that same election but will be presented as its own separate measure. This means that if the Council were to call a compensation charter amendment, the two measures would be voted on separately by the voters.
Effective Date of Charter Amendment
Charter amendments must be approved by a majority of Downey voters. Under state law, approved Charter amendments take effect when filed with the California Secretary of State after voter approval. Staff will take immediate action to file the Charter amendment following the certification of the vote by the County. For options 1 and 2 above, and added clarity, compensation would begin on the first day of the first month following the effective date of the charter amendment. For options 3 and 4, compensation would begin at a time fixed by the implementing ordinance itself.
CITY COUNCIL PRIORITIES
Efficiency & Adaptability
Public Engagement
FISCAL IMPACT
A ballot measure to amend the City Charter is intended to be revenue neutral, but here, if the compensation amendment is approved by the voters, there will be an annual cost of at least $12,000 per council member. There is also an expense associated with the placement of a measure on the ballot and the costs for the election. At the November 3, 2026 election, the City Council seats in Districts 2 and 4 plus the Charter Amendment covering other topics will be on the ballot. In consultation with the County, the estimated election cost for the City Council seats is $116,000 and $314,500 for the Charter Amendment. For a second ballot measure concerning council compensation, the estimated additional cost is $41,500. These figures are estimates and subject to some variance.