California Correctional Peace Officers' Ass'n v. State

The “ ‘arbitrary, capricious or unsupported by evidence’ standard applies to a review of the substantive merit of an administrative agency’s quasi-legislative act—that is, whether the agency ‘ “reasonably interpreted the legislative mandate.” ’ (Credit Ins. Gen. Agents Ass'n v. Payne (1976) 16 Cal.3d 651 , 657 [ 128 Cal.Rptr. 881 , 547 P.2d 993 ].)” (Wirth, supra, 142 Cal.App.4th at p. 138.) However, when the agency’s action depends solely upon the correct interpretation of a statute, a question of law, we exercise our independent judgment. (Ibid., citing Lewin v. St. Joseph Hospital of Orange (1978) 82 Cal.App.3d 368 , 386-387 [ 146 Cal.Rptr. 892 ].) In doing so, “we are guided by the principle that an ‘ “administrative [agency’s] interpretation [of controlling statutes] . . . will be accorded great respect by the courts and will be followed if not clearly erroneous.” ’ ” (Wirth, at p. 138, quoting Yamaha Corp. of America v. State Bd. of Equalization (1998) 19 Cal.4th 1 , 7 [ 78 Cal.Rptr.2d 1 , 960 P.2d 1031 ]; see also Spanish Speaking Citizens’ Foundation, Inc. v. Low (2000) 85 Cal.App.4th 1179 , 1214 [ 103 Cal.Rptr.2d 75 ] [while final responsibility for the interpretation of law rests with courts, the construction of statute by officials charged with its administration is entitled to great weight].)

B. Interpretation of Section 19849.18

CCPOA remains steadfast in its contention that section 19849.18 requires DPA to automatically grant salary and benefits increases to correctional supervisors employed by the State as a result of the Cohn Award’s grant of salary and health benefits increases to rank-and-file members.

“In 1999, Assembly Bill No. 743 . . . was enacted as section 19849.18. Supporters of the bill pointed out that the compensation of supervisors in certain departments was not keeping up with that of the employees they supervised. In some cases, the supervisors actually earned [even] less than the rank-and-file .... A promotion to supervisor could actually result in a lesser compensation package, creating recruitment and retention problems. The purpose of the bill was to halt the erosion of a compensation differential between nonunion supervisors and the rank-and-file employees of State Bargaining Units 5 (highway patrol officers), 6 (state correctional officers) and 8 (firefighters), whom they supervised.” (Wirth, supra, 142 Cal.App.4th at p. 135.) Alternatively stated, the law was enacted to prevent compensation “compaction” between supervisors and rank-and-file employees.

Section 19849.18, the statute at the heart of the present dispute, states: “Supervisors of state employees represented by State Bargaining Unit 5, 6, or 8

In 2000, Senate Bill No. 1910 (1999-2000 Reg. Sess.) was enacted as section 19849.22, creating a general policy of maintaining a compensation differential between supervisory peace officers and the rank-and-file employees they supervise, in order to attract and retain correctional supervisors. (Stats. 2000, ch. 902, § 1.)

In analyzing what the Legislature contemplated by enacting a statute, our first step is to examine the plain language because words are “ ‘generally ... the most reliable indicator of legislative intent.’ [Citations.]” (People v. Gardeley (1996) 14 Cal.4th 605 , 621 [ 59 Cal.Rptr.2d 356 , 927 P.2d 713 ].) “If the language is clear and unambiguous there is no need for construction, nor is it necessary to resort to indicia of the intent of the Legislature .... [Citations.]” (Lungren v. Deukmejian (1988) 45 Cal.3d 727 , 735 [ 248 Cal.Rptr. 115 , 755 P.2d 299 ].) On the other hand, if the language is ambiguous, “courts may employ a variety of extrinsic construction aids, including legislative history, and will adopt the construction that best harmonizes the statute both internally and with related statutes. [Citations.]” (Summers v. Newman (1999) 20 Cal.4th 1021 , 1026 [ 86 Cal.Rptr.2d 303 , 978 P.2d 1225 ].)

We turn first to the wording of section 19849.18, and find no clear, unambiguous language that would require DPA to grant contemporaneous salary and benefits increases to supervisory employees each and every time the rank-and-file employees receive salary and benefits changes. The statute requires “salary and benefits changes” that “are at least generally equivalent to the salary and benefits” of the employees they supervise. (Italics added.) By definition, “generally” means “in disregard of specific instances and with regard to an overall picture.” (<http://www.merriam-webster.com/dictionary/ generally> [as of Feb. 11, 2009].) The inclusion of the word “generally” reflects legislative intent that DPA take into account the totality of the circumstances, including the presence or absence of compaction, the size of the existing compensation differential, and the condition of the State’s budget to fund increases. To the contrary, CCPOA’s approach asks DPA to grant compensation increases with complete disregard for their need or other extenuating circumstances.

C. Analysis of the Legislative History and Statutory Scheme

Similar to the instant dispute, in Wirth, the California Correctional Supervisors Organization (CCSO) sought to compel DPA to afford salary increases for State correctional supervisors in fiscal year 2003-2004, increases CCSO claimed were mandated through its interpretation of section 19849.18. (Wirth, supra, 142 Cal.App.4th at pp. 134-135, 139.) Under CCSO’s interpretation, DPA was required to grant supervisors lockstep salary changes to those granted to the rank and file. (Id. at p. 139.)

“In its original form, Assembly Bill No. 743 (1999-2000 Reg. Sess.) required that supervisors be granted ‘the economic equivalent’ of salary and benefits changes accorded to their supervisees, and appropriated ‘an unspecified sum from the General Fund to the Controller to fund the salary and benefits] changes authorized by these provisions.’ (Legis. Counsel’s Dig., Assem. Bill No. 743 (1999-2000 Reg. Sess.) as introduced Feb. 24, 1999 . . . .) An appropriation . . . was subsequently inserted to implement the legislation. (Assem. Amend, to Assem. Bill No. 743 (1999-2000 Reg. Sess.) May 28, 1999.) Eventually, the bill was amended to delete any fiscal appropriation, and the phrase ‘at least generally' inserted to modify the term ‘equivalent.’ (Sen. Amend, to Assem. Bill No. 743 (1999-2000 Reg. Sess.) Sept. 8, 1999.)” (Wirth, supra, 142 Cal.App.4th at p. 141, first italics added & fn. omitted.)

“Manifestly, the bill was watered down from its original form so that it did not interfere with DPA’s traditional discretion in setting salaries, or require that salaries be increased without legislative appropriation.” (Wirth, supra, 142 Cal.App.4th at p. 142.) An enrolled bill memorandum to the Governor also confirms that in enacting section 19849.18, the Legislature did not intend to “jeopardize DPA’s salary setting authority.” (Enrolled Bill Mem. to Governor, Assem. Bill No. 743 (1999-2000 Reg. Sess.) Sept. 24, 1999, p. 1.)

Therefore, the Wirth court found, and we agree, that the Legislature enacted section 19849.18 “ ‘not for the puipose of attaining exactitude or identity between the salary and benefits of supervisors and the salary and benefits of the employees they supervise [i.e., rank and file], but for the purpose of avoiding compaction between supervisors’ and subordinates’ salary levels and maintaining a differential between those salary levels sufficient to recruit and retain supervisors.’ ” (Wirth, supra, 142 Cal.App.4th at

Wirth also discussed the importance of the overall statutory scheme of which section 19849.18 is a part. “ ‘[A]n individual statute must be construed in the context of the comprehensive statutory scheme of which it is a part. Statutes or statutory sections relating to the same subject must be harmonized, both internally and with each other, to the extent possible. Where uncertainty exists, appellate courts must construe provisions in a reasonable, common sense fashion talcing into consideration the practical consequences that will flow from a particular interpretation.’ ” (Wirth, supra, 142 Cal.App.4th at p. 140, quoting Berkeley Center for Independent Living v. Coyle (1996) 42 Cal.App.4th 874 , 878 [ 50 Cal.Rptr.2d 39 ]; accord, Long Beach Police Officers Ass'n v. City of Long Beach (1988) 46 Cal.3d 736 , 746 [ 250 Cal.Rptr. 869 , 759 P.2d 504 ].)

As noted, “[i]n 1981, the Legislature delegated the function of salary setting for nonmerit employees to DPA.” (Wirth, supra, 142 Cal.App.4th at p. 140, citing § 19815.2 and Tirapelle, supra, 20 Cal.App.4th at pp. 1322-1323 & fh. 8.) However, this grant of authority came with a significant caveat. Section 19826, subdivision (a), also enacted in 1981, declares that DPA “shall make no adjustments that require expenditures in excess of existing appropriations that may be used for salary increase purposes.” (Italics added.)

In enacting legislation, the Legislature is presumed to be aware of its prior enactments. (Wirth, supra, 142 Cal.App.4th at p. 140; Golden Day Schools, Inc. v. Department of Education (1999) 69 Cal.App.4th 681 , 691 [ 81 Cal.Rptr.2d 758 ].) “In this era of perennial budget deficits, we find it extremely unlikely that section 19849.18, enacted in 1999, would have been intended by the Legislature to trigger automatic salary [and benefits] increases without corresponding budget appropriations earmarked for that purpose. To indulge in such an interpretation would require that we infer that the Legislature intended section 19849.18 to repeal section 19826, subdivision (a) by implication [and this may not be done] without a declaration by the Legislature to that effect.” (Wirth, at p. 140, citing Golden Day Schools, at p. 691.) Instead, “ ‘ “[t]he presumption is . . . ‘against repeal by implication where express terms are not used and the statutes are not irreconcilable.’ ” ’ ” (Wirth, at p. 140, quoting County of Tulare v. Campbell (1996) 50 Cal.App.4th 847 , 853 [ 57 Cal.Rptr.2d 902 ].)

“Because DPA is forbidden by statute from increasing salaries without a legislative appropriation, it must necessarily navigate between implementing

This is certainly no less a concern today, when California faces its greatest public budgetary crisis in decades. To interpret section 19849.18 as CCPOA argues would necessarily require DPA to navigate its fiscal authority directly onto the shoals of budgetary irresponsibility, while ignoring the admonition that it “not commit[] the state to spending money that it does not have.” (Wirth, supra, 142 Cal.App.4th at p. 142.)

Lastly, CCPOA’s reading of section 19849.18 also conflicts with the later enacted section 19849.22. Section 19849.22, subdivision (b) provides that “[a] supervisory compensation differential is necessary . . . ,” leaving the differential percentage up to DPA’s discretion. According to the legislative history, Senate Bill No. 1910 (1999-2000 Reg. Sess.) initially included language that would have established a fixed 10 percent differential, but the Legislature ultimately chose not to, deciding that a general policy of “[a] supervisory compensation differential” was more appropriate. This contemplates a statutory scheme that allows DPA discretion in setting supervisory compensation increases. When two statutes touch upon a common subject, courts must construe them “in reference to each other, so as to ‘harmonize the two in such a way that no part of either becomes surplusage.’ [Citations.]” (DeVita v. County of Napa (1995) 9 Cal.4th 763 , 778-779 [ 38 Cal.Rptr.2d 699 , 889 P.2d 1019 ].) CCPOA’s interpretation does not harmonize the two statutes, but instead ignores section 19849.22’s mandate.

Therefore, it is within DPA’s discretionary power to decide what compensation increases comply with sections 19849.18 and 19849.22. DPA’s discretion allows it to look past each isolated rank-and-file compensation increase and determine the appropriate differential in light of the overall compensation picture, such as the presence or absence of compaction, the size of the existing compensation differential, the size of the demonstrated recruitment and retention problems among supervisors, and the State’s budgetary concerns.

Finally, turning to the facts at hand, CCPOA has failed to establish any violation of section 19849.18. CCPOA has presented no evidence to suggest that DPA has maintained an inadequate pay differential, ignored a serious compaction problem, or allowed the rank-and-file members to receive