Request By:
Mr. William D. Stephens
Supervisor
County Fee Systems
Executive Department for
Finance and Administration
Capitol Annex
Frankfort, Kentucky 40601
Opinion
Opinion By: Steven L. Beshear, Attorney General; By: Charles W. Runyan, Assistant Deputy Attorney General
The Department of Finance is charged with computing the maximum compensation of elected Kentucky constitutional officers for calendar year 1980, by the second Friday in February of 1980. Your computations are based on KRS 64.480(2), 15.755(7), 15.765(3), 64.527, and OAG 75-79.
The Consumer Price Index, as given to you by the Kentucky Department of Commerce, at December 31, 1979, was 229.9. That index is derived using 1967 as the base year. Your computations show you converted that index to 322.0, using 1949 as the base year, as required by statute. The conversion is correct under the formula 71.4 / 229.9 = 100 / X = 322, the C.P.I. figures being furnished by the Bureau of Labor Statistics, United States Department of Labor.
You request that we review your enclosed computation and give our opinion as to its correctness.
The "Rubber Dollar" principle adopted by the Old Court of Appeals in Matthews v. Allen, Ky., 360 S.W.2d 135 (1962), arose out of the sheer economic and political necessity for recognizing the consistent change each year in the actual purchasing power of the dollar as applied to salaries of constitutional officers. Section 246 of the Kentucky Constitution was recognized as imposing annual salary limits on the three categories of constitutional officers: (1) The limit of $12,000 for officers whose jurisdiction is coextensive with the state; (2) The limit of $8400 for circuit judges; (3) The limit of $7200 for all other public officers, which would include local constitutional officers. The section [246 Const.] was amended in 1949. In terms of an advancing consumer price index, the year 1949 [amendment of Sec. 246] must necessarily be used as the base year in applying the salary adjustment formula devised by the court.
The court, in adopting the "rubber dollar" approach, specifically arrived at a formula in authorizing salary adjustments in terms of the advancing consumer price index.
Under the formula set out in Matthews v. Allen, the adjustment for 1980 and thus the maximum compensation permissible for constitutional officers [mentioned in the text of the Constitution] who are in the $12,000 limit category [Sec. 246, Const.] would be this:
322.0 / 100 (Current C.P.I. [1949 base]) = X / $12,000
100X = $12,000 X 322.0
100X = 386400
X = $38,640
The $12,000 category applies to the Lieutenant Governor, Attorney General, Superintendent of Public Instruction, Commissioner of Agriculture, Secretary of State, State Treasurer, Auditor of Public Accounts, and Clerk of the Supreme Court. See KRS 64.480(2), which provides that the above officers must be paid the maximum permissible under "rubber dollar" .
Also included in the $12,000 category are the commonwealth's attorneys and county attorneys. See KRS 15.755(7) and 15.765(3). As to those officers, they cannot be paid a greater compensation than the rubber dollar maximum. The payment of the maximum rubber dollar amount is not automatic under those statutes.
Likewise, under the formula the maximum compensation permissible for constitutional officers who are in the $7200 limit category would be this for 1980:
322.0 / 100 = X / $7200
100X = $7200 X 322
100X = 2318400
X = $23,184
The $7200 category applies to the county judge/executives, county clerks, sheriffs, justices of the peace, county commissioners, coroners, and jailers. See KRS 64.527. Here again, the payment of the maximum rubber dollar amount is not automatic under that statute. The implementation of the rubber dollar principle will depend upon the fiscal court in setting salaries and the applicable operation of the fee system.
Assuming the correctness of the current consumer price index, it is our opinion that your computation of the maximum compensation payable to the constitutional officers in 1980 is correct. We indicated above where the maximum is automatic and where it is not.