Transit- Meeting Agenda (12/18/1997)

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l~-e~-lyy ~ ~1~: Nyl~f9 I-kUf1 Li~SL 10 • - ~ 1~LitV IS ~ Paw~r.L SP~.ARS - I.UBERSI~ ~ ''~'~ Decembex 2, 1997 VIA ~A,CSIIv~.E AND MA,II, Mary r,orensen L°"' °~~ ~ium,an Resources ~a~ager A~a Sa`: Yn Area Transit uabvrey 3140 De~ Webb Aveaue NE ~~ p Salena OR 97303-4~65 1 , Prv~ecsional ~~~°~ Re: Appkcation of ORS 267.130 to Merit Pay Awards szo s.w Our Fiie No. 17729-5 Yamhill sv«s Suito 800 Dear Mary: ~t~a, oR 97204-7$83 15~358~02~9 P.~? rsa~~ ~6~si Ear~er this year ax the ~oard meeting held on Jwne 26, 1997, the Baard o~D'uectors adopted a palicy concez~ing performance based merit awards. The policy authorizes the Gcnerai Feur~n~: Man~er to make merit pay awards in approp~iate cases. A,t the same Board meerting the «~ ~Q~ Board of I3irectors d~cided on its own motion attd without staff recomxneudation to no~ake a one-time mecit pay awaXd in Iieu o~ a cost of livi~ng adjustmem to which the Gencral Manager othezwise was entitled unde~r thc terms of his cmploynaent. You have in~quired concezning wheXhex ORS 267.130 pro~n'bits one-time merit pay awards grazited by the Board ta the Ge~erat Manager, VVe find mo case Iaw intexpreting this statute. We conclude that the mezzt pa.yment i~ hcu of COLA was lawful. The statute shou~d be constzued in a ma~nner consistezat with the ordinary meanuag of words comained th~rein. It is significant to us that the statute contrasts "money or any other thing of vatue as a considcratioa" with "in addition to the salary paid tb.e officer or emptoyee by the istri " (emphasxs added). We bel~eve that - a`~nerit pay award" paid by the District to its General Manager upon duec~ion of the governing body ot' paid by the District to auy other er~pioyee undex the performance based mexit award program for services pe~'ormed witbu~ the scope of the afficial duties of the officer or cmployee i~s a componcnt of "salary ~aid the officer or employee" sud is therefore not pro~u'bited by the statute. This payment is subject to state and fed~aral income tax withholding, antd it is subject to retirement contxxbutions under the ~`~ ~ District's ZCMA plans, and other taxes. In addition, the payz~o.ent is cleaa~riy part o£ ~~a~~ cA remuneration pai~d for putposes of all PERS computations under th~ PERS staiutes. Mouar Vcrnon, WA O,jympia, WA lhutlaad OR In our view, the statute seeks to prok~ibit kickbacks, bn~es, extra paymez~ts for consu~tiang $°" Ft°'~~, cA setvic~s and the Iike, wba~h may but not necessarily need arise where a conflict of interest is s~ca~, w,~ Lo„ao~, e~~a 49