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Request By:

Honorable Adrian Arnold
Representative
Co-Chairman
Interim Joint Committee on
Counties and Special Districts
Capitol Building
Frankfort, Kentucky 40601

Opinion

Opinion By: Steven L. Beshear, Attorney General; By: Charles W. Runyan, Assistant Deputy Attorney General

You raise a question concerning the rubber dollar statute applicable to local constitutional officers, i.e., KRS 64.527.

Specifically your question is as follows:

Let me illustrate my problem with an example. The maximum salary of an elected county official for 1981, as adjusted pursuant to KRS 64.527 was $26,058. The maximum for 1982 is $28,387, an increase of 8.93 percent. Suppose that on the first Monday in May of 1981 the fiscal court set the salaries for magistrates, who are not fee officials, for the coming term of office at $10,000 per magistrate. Subsequently, the newly elected fiscal court wanted to adjust the magistrates' salaries for the increase in the cost of living. Is the fiscal court limited to increasing the magistrates' salaries to $10,893, by which such salaries would "merely (be) kept abreast of their initial value or purchasing power, " or can the fiscal court increase the magistrates' salaries to the adjusted 1982 constitutional maximum of $28,387?

It is true that KRS 64.530(4) states in part that the compensation of elected county officers shall be set by the first Monday in May of the year of their election and cannot be changed during the term. In addition §§ 161 and 235 prohibit a "change" in compensation during term. However, as you point out, the Court of Appeals handed down the rubber dollar decisions in

Matthews v. Allen, Ky., 360 S.W.2d 135 (1962) and

Commonwealth v. Hesch, Ky., 395 S.W.2d 362 (1965), in which the court wrote this at page 363 of Hesch:

We reaffirm our decision in Matthews v. Allen, above, because it expresses in current values the initial values which are the essence of Section 246 (the same as tax assessments are intended by Section 172 to express current values). We further conclude that the salary increases here involved do not violate the purpose of the constitutional provisions prohibiting changing compensation during current terms of office, for on the theory of construction we have adopted, the salaries of the various offices are merely being kept abreast of their initial value or purchasing power. The Commissioner of Finance and other officers shall authorize payment of the salary increases directed by the General Assembly.

The rubber dollar cases reflect the constitutional principle that the dollar, as relates to constitutional officer compensation, as outlined by maximum level in § 246 of the Kentucky Constitution, is subject to purchasing power adjustment in terms of the evolving Consumer Price Index. Think how drastically the purchasing power of the dollar has undergone change upward since 1949 (amendment to § 246, Ky. Const.). The cases of Matthews v. Allen and Commonwealth v. Hesch make it clear that the actual application of the rubber dollar concept requires specific statutory implementation by the General Assembly. That is precisely what you have done in enacting KRS 64.527, which applies to justices of the peace and county commissioners sitting on fiscal courts.

We must understand that the "dollar adjustment" is one concept and the "change in compensation" is another. For example, a decrease in salary of a constitutional officer during term would fall clearly within the prohibition against a "change" in compensation under §§ 161 and 235, Constitution. In addition, any upward adjustment of a constitutional officer's salary during term which is not made pursuant to an implementing C.P.I. statute would be a prohibited "change" in compensation. Note the case of

Carey v. Washington County Fiscal Court, Ky., App., 575 S.W.2d 161 (1979). The court held that under a coroner's statute dealing only with a minimum salary, an attempted raise to comply with the new minimum would violate §§ 161 and 235, Constitution. The court correctly found that the minimum salary statute, KRS 64.185, was not an implementing rubber dollar statute. Therefore, the court said, there was no statutory basis for applying the rubber dollar principle. However, the statutory picture changed in 1976, upon the amending of KRS 64.527, the rubber dollar statute, to include coroners.

In response to your question, where the magistrates' salaries on the first Monday in May in 1981 (election year) was set at $10,000 per magistrate, the judicial rubber dollar concept does not work on an isolated numerical advancement from one year to the next. It works simply by authorizing the maximum payable each year by computing it under the rubber dollar formula. For example the C.P.I. formula is as follows for 1982: 281.5 (current C.P.I. in terms of 1949)= X71.4 (1949 C.P.I.)$7200(§ 246)71.4X = 281.5 X 720071.4X = 2,026,800X = 28,387


In OAG 82-80, copy enclosed, we computed the maximum salary payable to local constitutional officers and found it to be $28,387 for the calendar year 1982.

Thus the fiscal court could authorize a salary to each magistrate, not to exceed $28,387 for the calendar year of 1982. However, since the magistrates on fiscal court have no executive duties, they should only be paid in terms of the work week they put in for the county. They can investigate county matters and collect all kinds of pertinent information which would lead to their carrying out effectively their legislative duties. If the magistrates could show that they put in at least one day each five work week for the county, they would equitably be entitled to 20% of the maximum, which maximum is $28,387, etc. See OAG 77-774, copy enclosed.

We hope this will be helpful to you and your committee.

Disclaimer:
The Sunshine Law Library is not exhaustive and may contain errors from source documents or the import process. Nothing on this website should be taken as legal advice. It is always best to consult with primary sources and appropriate counsel before taking any action.
Type:
Opinion
Lexis Citation:
1982 Ky. AG LEXIS 290
Forward Citations:
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